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Let’s discuss banking secrecy and privacy in the financial sector in Monaco. This article will be surely useful for those who seek to enter the financial market of Monaco or to obtain a financial license in the country.
In Monaco managers and employees of financial institutions must follow the conditions of professional secrecy. The violation of these rules can be legally prosecuted.
Before getting a financial license in Monaco, it is necessary to study thoroughly what information about banking activities is confidential. Mostly, it happens to be information related to customers. It can be relieved to the bank by the customer during the banking services’ provision.
Meanwhile, banks build a relationship with borrowers and depositors, clients provide to the banks the facts on their private life: the financial position, business relations, and other details. All the information about the account has to be confidential: assets, transactions, name and type of the account, identities of agents, and guarantors.
Professional secrecy covers accurate and non-public information kept confidential outside of the relationship between clients and banks. Banks are obliged to store and protect confidential information about their clients properly.
It is important to note that if required by law banking secrecy can be disclosed and it will not be considered a crime. In Monaco, as in other states with a disciplined financial system, when the supervisors, AML or CFT authorities and local legal authorities request some information for criminal investigations, it must be disclosed.
Additionally, if a person has a tax address in France, it is an exception to banking secrecy. This condition is noted in the tax agreement between France and Monaco.
For individuals who plan to obtain a banking license in Monaco, it is worth taking into consideration the consequences that come after the violation of confidentiality rules. This kind of violation can be persecuted by legal authorities. Therefore, if the bank discloses the confidential information, the client is illegible to demand compensation for the damages caused by the bank’s behavior.
Furthermore, it is stated in the Monaco Penal Code that the custodian of a secret entrusted to them discloses the secret, the punishment can have a form of imprisonment for a term up to 1 year or of a financial penalty of around 18000 EUR. The exception is of course the reasons for disclosure dictated by law.
We have presented a short overview of the confidentiality rules of private banking in Monaco. We have also talked about the kinds of information that fall under the secrecy laws and about the consequences of disclosing them illegally.
If you would like to have a banking license in Monaco, our specialists in COREDO are ready to be at your service. We will be happy to advise you on the regulation of banking activities in Monaco and help you with obtaining the license.