Liechtenstein found terror funding linked to Spain

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IMF report reveals details of money laundering activity

6 March 2008

MADRID - In the midst of an ongoing probe into massive financial fraud in Liechtenstein, the International Monetary Fund (IMF) yesterday published a report revealing that Spain had been previously implicated in two investigations into financial irregularities: one involved money laundering and the other "financing of terrorism."

The report, which states that the Alpine principality has been prime territory for money laundering activities, reads: "Liechtenstein conducted three investigations relating to terrorist financing. [In one], the proceedings were referred to the Spanish authorities. This investigation was triggered by a suspicious activity report filed by a Liechtenstein financial intermediary."

The Liechtenstein authorities have also investigated 128 cases of money laundering since 2003, according to the IMF, of which, "only two out of these 128 were actually prosecuted," and one of which was in Spain. The report adds that there have been no convictions for the offence. An IMF spokesperson declined to give further comment on the Spanish connection.

A potentially massive case of tax fraud - unrelated to the IMF report - was blown open earlier this month when Germany admitted to paying EUR 4.2 million for information on German nationals with accounts at LGT, a private bank owned by Liechtenstein's royal family. Several other countries have since launched their own inquiries. On 26 February Spain began to look into the activities of its own citizens who had allegedly been using LGT to hide money from the tax office.

[Copyright EL PAÍS / KELLY RAMUNDO / Lucía Abellán / M. J.  2008]

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