AML/CFT-P-C • Draft law No. 279 amending Law No. 1.362 with a view to replacing the criminal liability of compliance officers with a system of administrative liability

Draft law No. 279 amending Law No. 1.362 of 3 August 2009, as amended, on combating money laundering, the financing of terrorism and the proliferation of weapons of mass destruction, and corruption, with a view to replacing the criminal liability of compliance officers with a system of administrative liability, was received on 8 May 2026 by the Parliament.

Note: a draft law adopted by Parliament (Conseil National) is forwarded to the Government, which has the option of transforming it into a bill or suspending the legislative procedure.

SUMMARY

Draft law No. 279 aims to reform the liability regime applicable to compliance officers of entities subject to Law No. 1.362 on combating money laundering, the financing of terrorism and of the proliferation of weapons of mass destruction, and corruption (AML/CFT-P-C).

As it stands, AML/CFT-P-C compliance officers appointed under Article 27 of Law No. 1.362 may face criminal liability in the event of a breach of their professional duties, particularly with regard to reporting suspicious activity.

Draft law No. 279 provides for the administrative liability of AML/CFT-P-C compliance officers for unintentional breaches of their professional obligations. Criminal proceedings would be reserved for cases of active, intentional and proven complicity in an offence of money laundering, terrorist financing, proliferation of weapons of mass destruction, or corruption.

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IN DETAIL

Reasons for the proposed reform

According to the Explanatory Memorandum, the current regime is said to be “out of step with the contemporary foundations of criminal law and with European and international standards on compliance” for the following reasons:

Compliance is primarily a matter of prevention and internal organisation, rather than the criminal prosecution of unintentional professional failings. The criminalisation of compliance officers would fail to recognise:

• the principle of personal criminal liability, insofar as they do not directly participate in the commission of potentially unlawful acts, but essentially carry out a role of monitoring, vigilance and reporting. As compliance officers are “most often employees and therefore subject to hierarchical authority”, penalising them would lead to “shifting criminal liability from decision-makers to supervisors, in defiance of the principle of personal fault”.
• the principle of legality of offences and penalties, “which requires that criminal law be formulated in terms that are sufficiently clear, precise and predictable”. The obligations to “report a suspicion”, to “assess a risk” or to “put in place adequate measures” are not accompanied by “objective criteria for determining their content or, above all, the threshold at which these obligations must be regarded as fulfilled or breached.”
• the principle of proportionality of penalties, in that there would be a “manifest disproportion between the nature of the offence – consisting of a lack of vigilance or organisation – and the severity of the penalty incurred, which could amount to imprisonment.” By comparison, in France, compliance officers are only held criminally liable in the event of personal involvement in an offence, on the basis of criminal provisions punishing money laundering. In Germany, breaches of due diligence obligations are subject to administrative sanctions (Ordnungswidrigkeiten).
• the ne bis in idem principle, "in that it leads to the same breach being penalised repeatedly under different classifications" (administrative sanctions against the legal person, criminal proceedings against the legal person or its directors, disciplinary sanctions, to which the independent criminal liability of the compliance officer would be superimposed).

Finally, the Explanatory Memorandum highlights the practical effects of the current system, which are deemed counterproductive: the reporting of suspicious activity is said to be becoming a “precautionary reflex”; the bureaucratisation of internal procedures driven by a defensive mindset; and the deterioration of client relations due to “an increase in excessive precautionary measures”; “the excessive caution arising from this criminal liability often leads banks to close existing accounts”; qualified professionals are reportedly being deterred from taking on the role of AML/CFT-P-C compliance officer, “ultimately undermining the very quality of compliance systems”.

Provisions of Draft Law No. 279

New paragraph added to Article 27 of Law No. 1.362 (hereinafter “L.”). Clarification of the criminal and administrative liabilities of compliance officers responsible for AML/CFT-P-C prevention.

• Those responsible for AML/CFT-P-C prevention may be subject to criminal prosecution for breaches of their professional obligations only in cases where it is established that they knowingly participated in an act of money laundering, terrorist financing or corruption, or deliberately aided and abetted such acts.
• Any unintentional professional breach of these obligations falls exclusively within the scope of administrative liability as provided for in Article 27-1 of Law No. 1.362 (see below).

New Article 27-1 L. Administrative sanctions that may be imposed by the sanctions panel of the Monegasque Financial Security Authority (AMSF) against the compliance officers and in their personal capacity, in the event of a breach of their professional obligations arising from this Law and its implementing regulations, which does not constitute intentional participation in an offence of ML/FT-P-C.

Nouvel article 27-1 L. Sanctions administratives pouvant être prononcées par la formation de sanction de l'Autorité Monégasque de Sécurité Financière (AMSF) à l'encontre des responsables de la conformité et à titre personnel, en cas de manquement à leurs obligations professionnelles résultant de la présente loi et de ses textes d'application, ne constituant pas une participation intentionnelle à une infraction de B/FT-P-C.

• 1) a warning; 2) a reprimand; 3) a temporary ban on acting as an AML/CFT-P-C compliance officer within one or more of the bodies or persons referred to in Articles 1 and 2 of Law No. 1.362, for a period not exceeding five years; 4) permanent disqualification from acting as an AML/CFT-P-C compliance officer, imposed only in cases of serious, repeated or deliberate breaches; 5) a financial penalty, the amount of which may not exceed, per decision, the sum of €500,000.
• These sanctions are subject to appeal before the Tribunal Suprême under the conditions of ordinary law.
• With the exception of a warning, sanctions may be published in the Journal de Monaco, under the conditions and in accordance with the procedures laid down by sovereign order.

New Article 27-2 L. The provisions of Law No. 1.362 relating to the procedure and powers of the AMSF sanction panel shall apply as appropriate, subject to any adjustments required by the nature of the person being prosecuted.

• The rules on summons, adversarial proceedings and the composition of the disciplinary panel provided for in Law No. 1.362 and its implementing regulations shall apply to proceedings against compliance officers.

New Article 27-3 L. Offences not subject to administrative liability.

• Offences relating to the breach of confidentiality of a suspicious transaction report provided for by Law No. 1.362 retain their criminal nature, including where they are committed by a compliance officer. These offences, constituting deliberate acts, do not fall within the scope of the administrative liability regime provided for in Article 27-1.

New paragraph V of Article 71-2 L. Breaches not falling within the scope of criminal liability.

• Unintentional professional breaches by compliance officers of their reporting obligations do not fall within the scope of the provisions of this Article, but exclusively within the administrative liability regime provided for in Article 27-1.

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