CSSF AML/CFT external report Circular 21/788

Author: Natalia Hernandez
Published on

On December 17, 2021, the CSSF issued Circular 21/788 providing guidance on the report dedicated to the AML/CFT mentioned in Article 49 of the CSSF Regulation 12-02 (hereafter the “CSSF AML/CFT external report”).

For the financial years ending on or after 31st of December 2021, Luxembourg investment funds that have not appointed an investment fund manager, and Luxembourg investment fund managers, including registered alternative investment fund managers (“Managers”) shall draw up a CSSF AML/CFT external report in accordance with the Circular 21/788.

Pursuant to the Circular 21/788 an approved statutory auditor (réviseur d’entreprises agréé) (“Auditor”) shall draw up the CSSF AML/CFT external report. In case they are required to appoint an Auditor to audit their accounts, this same Auditor shall prepare the CSSF AML/CFT external report.
The AML/CFT external report is divided in two sections in which the Auditor must:

  1. Corroborate the answers given by the funds and the Managers in the CSSF annual AML/CFT online survey; and
  2. Perform sample testing using a risk-based approach.

The CSSF AML/CFT external report will cover the following fields:

  • AML/CFT Procedures
  • Risk based approach
  • Funds Due Diligence
  • Channels of Distribution Due Diligence
  • Discretionary Portfolio Management – Client identification
  • Transfer Agent – Investor identification
  • Investments Due Diligence
  • Name screenings
  • Oversight on service providers and/or delegates performing AML/CFT controls
  • Oversight on branches and/or subsidiaries
  • Cooperation with authorities

The CSSF AML/CFT external report must be exclusively submitted by the AML RC (Responsable du Contrôle du respect des obligations professionnelles en matière de lutte contre le blanchiment et contre le financement du terrorisme) or by the AML RR (Responsable du Respect des obligations professionnelles en matière de lutte contre le blanchiment et contre le financement du terrorisme) or, by a member of the Board of Managers or Directors, to the CSSF through its on-line platform eDesk.

It must be submitted on an annual basis, within 6 months of the closing of the entity’s annual accounts. A three-month extension is granted for financial years ended on the 31st of December 2021, that is, they will have until 31st of September 2022 to submit said report.

The article was co-authored by Georgia Milne Aboitiz.

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