Trustees and trust companies
The total revision of the Professional Trustees Act created a comprehensive, efficient and internationally recognized supervision of the trust business. Consequently it is possible to combat abuse even more efficiently.
Client protection is especially ensured by monitoring the licensing requirements and the compliance with the licensing conditions as well as by cooperating with the competent authorities such as Courts, the Office of the Public Prosecutor, the Financial Intelligence Unit and the Liechtenstein Association of Professional Trustees. The FMA may also file disciplinary charges with the Professional Ethics Committee. The legal foundations are the Financial Market Authority Act (FMA Act) and the Trustees Act (TA).
Monitoring of licensing requirement / Use of professional and business terms
Anyone intending to offer services under the Trustees Act in the Principality of Liechtenstein requires an FMA licence as a professional trustee or trust company. The FMA monitors compliance with this licensing requirement and authorized use of the term “professional trustee” or equivalent professional or business term. It follows up on all indications of non-licensed trustee activities or the use of protected terms by non-licensed persons.
If there is a justified suspicion that a person is engaged in commercial trustee activities without authorization or is unlawfully using the term “professional trustee” or an equivalent professional or business term, the FMA initiates supervisory proceedings to determine the state of affairs. It may demand information and documents from the persons concerned and from third parties as if they were supervised persons. Besides that, the FMA is entitled to conduct audits at the business premises of trustees and trust companies (so called on-site inspections). If the suspicion is substantiated in the course of the preliminary clarifications, the FMA files criminal charges with the Liechtenstein Office of the Public Prosecutor.
Monitoring of compliance with licensing conditions
After granting a licence, the FMA monitors permanent compliance with the licensing conditions. If there are grounds for suspicion that the licensing conditions are no longer met, the FMA initiates supervisory proceedings and seizes the necessary measures. If, for instance, it comes to the attention of the FMA that a professional trustee or trust company no longer maintains the legally required liability insurance, then it demands that the licensed person provide evidence of such insurance. If the person fails to comply, the FMA suspends the person’s activities as a professional trustee until the evidence is provided. Besides that, the FMA is entitled to withdraw or revoke licences according to the provisions of the Professional Trustees Act.
If the FMA believes that a professional trustee or trust company is breaching professional obligations or that the professional or private conduct is interfering with the honour, reputation and credibility of the profession, it files disciplinary charges with Professional Ethics Committee of the Liechtenstein Association of Professional Trustees.
Penalization of infringements
Any person who realizes one of the following infringements is subject to a fine of up to 100.000 Swiss francs:
- infringement of the legal obligation to provide information or reports to the FMA or engaged third parties, providing of incorrect data, concealing of relevant facts or non-disclosure of information and documents;
- non-compliance with legally binding orders, instructions or measures issued by the FMA;
- non-compliance with a request of the FMA to cooperate in preliminary proceedings or administrative assistance;
- infringement of licensing conditions and requirements.
Cooperation with competent authorities
To combat abuse, the FMA especially works closely together with the competent bodies (Office of the Public Prosecutor, courts, authorities and professional association). With the exception of national and international obligations to cooperate, the FMA in principle does not provide information about ongoing proceedings. Besides that, the FMA informs the Liechtenstein Office of Justice of any granting, withdrawing or revoking of licences as well as of a temporary prohibition to pursuit business activities as a trustee or trust company. The FMA reports to the Professional Ethics Committee about any initiation of regulatory proceedings.
Institutions for the protection of clients
FMA: The FMA’s competence covers the points referred to above as well as the penalization of infringements (article 81 TA). In particular, it is not responsible for civil disputes between professional trustees or trust companies and their clients.
Professional Ethics Committee: Exercise of disciplinary powers over professional trustees and trust companies (article 68 TA). The Professional Ethics Committee is responsible for decisions imposing disciplinary fines and preliminary measures. A professional investigator who acts as a prosecutor within the Professional Ethics Committee is responsible for the acceptance of notifications (article 72 TA).
Liechtenstein Association of Professional Trustees: Safeguarding the reputation and the rights and duties of the trustee trade.