Commission de Surveillance du Secteur Financier (CSSF) is also known as Financial Supervisory Authority. CSSF is the enterprise in charge of the financial arrangements in Luxembourg. Credit organizations, pension funds, investment companies, payment CSSF, credit institutions, financial sector experts, investment companies, retirement funds, and payment institutions are responsible for auditing.
CSSF is also responsible for following the activities of financial products and service providers. Monitors whether businesses are implementing the AML/CTF law against money laundering and terrorist financing.
CSSF is obliged to supervise the following institutions and activities:
- Executive Board Secretariat
- General secretary
- PFS Application Guide and Regulation
- Law Department
- General surveillance of the audit profession
- Accounting, inspection, and transparency
- Control of banks
- Singe Supervisory Mechanism (SSM)
- Deposit and Investor Protection
- Control of securities markets
- Control of investment firms
- Innovation, Payments, Markets Infrastructures, and Governance
- Checking information systems.
What Are CSSF Obligations?
The CSSF ensures that the financial market and its applications are transparent. Under The Transparency Act for trading market activities and products:
Following Article 3, an annual financial report should be established with the four monthly' plans after each financial year.
Following Article 4, a half-year financial report should be established with the plan for the last 3 months after the end of the first six months of each financial year.
Following Article 5, create a report with government payments.
What Are The Purposes of CSSF?
In Luxemburg, regulations on anti-money laundering and counter-terrorist financing were introduced under the Luxembourg Act. According to this law, many crimes such as organized crime, human trafficking, drug trafficking, and corruption are considered money laundering crimes. CSSF, on the other hand, adopts goals aimed at preventing money laundering and audits businesses for this purpose. The main purposes of CSSF are as follows:
- To encourage businesses to prepare a business policy that includes legal regulations.
- Protecting the reputation of the financial sector and regulated institutions
- Implementing practices for businesses to adopt a risk-based approach.
- To strengthen businesses in risk management.
CSSF and Financial Intelligence Unit (FIU) are closely related to each other. Both carry out activities to prevent money laundering, so they have the authority to exchange information to fulfill their duties. Concerning the AML / CTF of professionals, CSSF and FIU must fully cooperate. Also, CSSF can exchange information with other AML / CTF competent authorities at the national or international level.
As a result, when it is inspected from a legal perspective, the basic obligation of CSSF is to ensure that all persons and institutions subject to supervision and authorization adhere to AML / CTF regulations. CSSF also has the right to implement specific sanctions for institutions that do not comply with these obligations.