MONEYVAL • Good repute check (Sovereign Order no. 10.513 of 17 April 2024)

MONEYVAL • Good repute check by the supervisory department of the Monegasque Financial Security Authority (AMSF)

Sovereign Order no. 10.513 of 17 April 2024 (JDM no. 8691 of 19 April 2024) further amends Article 36-3 of Sovereign Order no. 2.318 of 3 August 2009 setting the conditions for application of Article 53-2 of Law no. 1.362 of 3 August 2009 on AML/CFT relating to checks on the good repute of the natural persons referred to in Article 1 of the said Law, as well as the persons responsible for the effective management, members, shareholders and beneficial owners of the entities and legal persons referred to in the same Article: elements of assessment, information on which the AMSF can rely.

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As a reminder, a new version of Article 53-2 of Law no. 1.362 came into force on 2 March 2024, which requires the bodies and persons referred to in Article 1 of the said Law to ensure that the persons providing their effective management, their members, their shareholders and their beneficial owners satisfy the good repute requirements defined by Sovereign Order no. 2.318.

Law no. 1.559 of 29 February 2024 (Part IV) added that the department responsible for supervising the AMSF ("Service exerçant la fonction de supervision") shall monitor compliance by the aforementioned bodies and persons with these conditions of good repute, not only on an ongoing basis, but also at the time the application for authorisation, authorisation or declaration is examined.

The new wording of article 36-3 of Sovereign Order no. 2.318

The new wording of Article 36-3 of Sovereign Order no. 2.318 is clearer as regards the fact that it applies Article 53-2 of Law 1.362 and as regards the persons concerned by the good repute check, who are precisely listed.

The factors taken into consideration to assess good repute are no longer limited to judicial, administrative or disciplinary decisions or measures to freeze funds, but also include current proceedings and other relevant information or factors.

It is added that the AMSF department responsible for supervising ("Service exerçant la fonction de supervision") may rely for control purposes on information available to it as part of its supervisory duties, or that it has obtained from other AMSF departments, or from other government departments (Economic Development Department, Tax Department, judicial authorities, Budget and Treasury Department, Financial Activities Control Commission, Public Security Department) or from foreign supervisory authorities.

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Article 36-2 (wording as from 20 April 2024)

"Pursuant to article 53-2 of the aforementioned amended law no. 1.362 of 3 August 2009, the good repute of the natural persons referred to in article 1 of this law, of the persons providing effective management, of the members, shareholders and beneficial owners of the undertakings and legal persons referred to in the same article, shall be assessed in particular in consideration of:

- any relevant judicial, administrative or disciplinary record concerning them, such as in particular judicial, administrative or disciplinary decisions or measures freezing funds, and any current proceedings, in particular judicial, administrative or disciplinary proceedings, in which the said persons are involved or which relate to matters for which they could be held liable;

- all relevant information and all information likely to establish that the persons concerned are of good repute and offer every guarantee of irreproachable business conduct.

Good repute checks shall be carried out on a case-by-case basis on the basis of all the relevant information available to assess the risks presented by the person in question, having regard to the nature of the activity concerned.

For the purposes of checking the good repute of the persons referred to in the first paragraph, the department exercising the supervisory function of the AMF may rely on the information available to it as part of its supervisory functions, as well as on any relevant information or documents that it may request or receive on their own initiative from the other departments of the AMF that perform the functions of financial intelligence unit and sanction unit.

In addition, the AMF's supervisory department may also use any useful information obtained from the government departments referred to in Article 36-4 and, in the context of international cooperation, from foreign supervisory authorities exercising similar powers."

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Article 36-2 (previous wording, between 30 September 2023 and 20 April 2024)

"The persons referred to in the first paragraph of article 53-2 of lawno. 1.362 of 3 August 2009, as amended, referred to above, must not have been subject for less than ten years to:

1°) a final sentence of imprisonment or a suspended sentence of at least six months for one of the offences provided for in Section VII of Chapter III of Title I of Book III of the Criminal Code or in articles 70, 71, 75, 77-2, 80 and 80-1 of law no. 1.362 of 3 August 2009, as amended, referred to above ;

2°) a measure freezing funds and economic resources pursuant to Sovereign Order no. 8.664 dated 26 May 2021, as amended, referred to above;

3°) an administrative sanction as provided for in figures 8°) to 11°) of Article 65-8 of law no. 1.362 of 3 August 2009, as amended, referred to above, which has become final;

4°) a final conviction for one of the penalties referred to in numbers 1°) to 7°) of Article 65-8 of law no. 1.362 of 3 August 2009, as amended, referred to above, in the event of repeated breaches of the obligations of the same law.

The Authority shall assess the compatibility of the following convictions with the nature of the activity pursued by the persons referred to in the first subparagraph where such persons have been subject to:

a) a non-final conviction for one of the offences referred to in point 1) or for one of the administrative penalties referred to in points 3) or 4) ;

b) a final conviction dating back more than ten years for one of the offences referred to in point 1) or for one of the administrative penalties referred to in points 3) or 4) ;

c) any other conviction before a civil, administrative, criminal or disciplinary court or an order freezing funds and economic resources pursuant to the aforementioned Sovereign Order no. 8.664 of 26 May 2021, as amended, dating back more than ten years."

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