Administrative sanction of 1 December 2025
Executive Summary
The CSSF imposed an administrative fine of EUR 10,000 on registered alternative investment fund manager (AIFM) C5 S.à r.l. on 11 September 2025 for failing to submit its annual financial crime questionnaire by the 4 April 2025 deadline, despite reminders, breaching the cooperation obligation under Article 5(1) of Luxembourg's AML/CFT Law of 12 November 2004. This enforcement action underscores the CSSF's strict enforcement of AML reporting duties and serves as a warning to supervised entities on the consequences of non-compliance with supervisory requests. It matters because it demonstrates the CSSF's willingness to publish names and impose fines for procedural lapses, potentially signaling increased scrutiny on AIFMs' AML/CFT obligations amid broader regulatory focus on financial crime risks. #
What Changed
This is not a regulatory change or new requirement but an enforcement precedent highlighting existing obligations under the AML/CFT Law: - Mandatory annual submission of the CSSF financial crime questionnaire by supervised entities, including registered AIFMs, as part of the cooperation duty in Article 5(1). - Fines determined per Article 8-4(1), (2)(f), and (3)(a), considering circumstances under Article 8-5(1), with publication assessed for proportionality under Article 8-6(1). No new rules introduced; reinforces that failure to respond to reminders constitutes a breach. #
What You Need To Do
- Immediate verification
- Procedural enhancements
- Training and testing
- Engagement protocol
- Policy updates
Key Dates
Compliance Impact
Urgency: High – This sanction, though modest at EUR 10,000, exemplifies CSSF's proactive use of fines and public naming for AML reporting failures, with potential for higher penalties up to EUR 500,000 or 0.5% of turnover. It heightens risks for registered AIFMs amid CSSF's 2025-2026 priorities on financial crime, sanctions, and expanded reporting (e.g., Circular 25/894), where procedural lapses c
Who is Affected
Summary
Administrative sanction imposed on a registered alternative investment fund manager (“AIFM”)