The commission said the grand duchy had not fully transposed the 4th Anti-Money Laundering Directive into national law by the 26 June 2018 deadline.
Luxembourg’s government said the rules were transposed in February and August and it’s working with the commission to clarify the matter.
The rules require stricter checks on clients by accountants, banks and lawyers, among other provisions.
“We have stringent anti-money laundering rules at EU level, but we need all Member States to implement these rules on the ground. We don't want any weak point in the EU that criminals could exploit. The recent scandals have shown that Member States should treat this as a matter of urgency.”
“Luxembourg is among EU states that use a loophole to avoid disclosing fines to banks for money laundering, despite international guidelines that recommend publication of sanctions as a key measure to help prevent financial crime.
“The Duchy secretly imposed a fine of 8.9 million euros ($10.16 million) last year on Luxembourg-headquartered Industrial and Commercial Bank of China (ICBC) after a Spanish investigation exposed a large money laundering operation at the bank, legal sources told Reuters.”
Brussels also sent warning letters to Estonia and Denmark this week. The commission had previously filed cases against Ireland and Romania alleging they had not implemented the new anti-money laundering rules.
The commission said it asked the European Court of Justice, in Kirchberg, to levy “a lump sum and daily penalties until Luxembourg takes the necessary action.”
A spokesman for Luxembourg’s finance ministry told Delano on Friday that:
“Luxembourg has taken note of the decision of the European Commission dated 8 November 2018 to refer Luxembourg to the Court of Justice for not completely implementing the 4th anti-money laundering directive (2015/849) into national law.
“Luxembourg is firmly committed to the fight against money laundering and the financing of terrorism, at national level as well as at international and European level.
“Luxembourg has transposed the aforementioned directive through the laws of 13 February 2018 and 10 August 2018 (Parliamentary Records No. 7128, 7216A and 7287).
“The anti-money laundering legal framework will be completed, in particular by the transposition of the 5th anti-money laundering directive, within the deadlines set by the directive.
“The Luxembourg authorities are in close contact with the services of the European Commission to provide any necessary clarification on this matter.”
Update: Comments from Luxembourg’s finance ministry were added on 9 November at 3pm.