Commission de Surveillance du Secteur Financier

The Commission de Surveillance du Secteur Financier (CSSF) is responsible for the financial regulation in Luxembourg.[1] The CSSF is responsible for the supervision of credit institutions, experts in the financial sector, investment companies, pension funds, regulated securities markets and their operators, multilateral trading facilities and payment institutions. The CSSF is the competent authority for the public auditor oversight.

Commission de Surveillance du Secteur Financier
CSSF
Agency overview
FormedJune 1, 1998 (1998-06-01)
JurisdictionGovernment of Luxembourg
HeadquartersLuxembourg
Employees911 (1 January 2020)
Agency executive
  • C. Marx, Director General
Websitewww.cssf.lu

History

The CSSF took over the duties of the former Commissariat aux Bourses and of the Institut Monétaire Luxembourgeois (IML), which on 1 June 1998, became the Banque centrale du Luxembourg (BCL).[2]

General organisation

Beside the Executive board, the CSSF consists of:[3]

  • Executive Board secretariat
  • General secretariat
  • PFS application guidance and regulation
  • Legal department
  • On-site inspection
  • Public oversight of the audit profession
  • Accounting, auditing and transparency
  • UCI departments
  • Supervision of specialised PFS
  • Supervision of banks
  • Singe Supervisory Mechanism (SSM)
  • Depositor and Investor Protection
  • Supervision of securities markets departments
  • Supervision of investment firms
  • Innovation, payments, markets infrastructures and governance
  • Supervision of information systems and support PFS
  • Personnel, administration and finance
  • Information systems of the CSSF (IT)
  • Resolution

Responsibilities

Supervision

The CSSF supervision of the financial sector aims at the following:[4]

  • Promotion of a considered and prudent business policy in accordance with regulatory requirements
  • Protect the financial stability of the regulated entities and the financial sector as a whole
  • Monitoring the quality of the organization and internal control systems
  • Strengthening the quality of risk management

The CSSF monitors all financial activities in Luxembourg, which require the approval of the Minister responsible for the CSSF. It is only in the public interest, ensure that the laws and ordinances are enforced on the financial sector and respected and that international conventions and EU directives in the areas under their responsibility to be implemented. The CSSF is authorized to require all necessary information to perform their duties of companies under its supervision. The CSSFübernimmt at Community and international level negotiations on the financial sector and coordinate the implementation of government initiatives and measures about an orderly expansion of the activities of the financial sector.

Public auditor oversight

The CSSF is the public auditor oversight. In this regard, the CSSF is thus responsible for the granting of the professional qualifications of the "Independent Auditor" (auditors) and "cabinet de Revision" (audit) for the approval and registration of statutory auditors and audit firms. The CSSF is also responsible for the implementation of auditing standards and professional ethical standards and internal quality control of audit firms and approved for continuing education.

Investor protection

The CSSF is directly responsible for investor protection related queries. As part of the FIN-NET program, the CSSF is the sole recourse for investors who seek compensation or complaints handling. Unlike some jurisdictions, there is no separate or independent ombudsman. There have been a number of high-profile cases, including Madoff, where the CSSF's ability to enforce customer complaints has come into question. To date, the general response has been unsatisfactory and there are increasing concerns over the capabilities of the CSSF to carry out their duties effectively. With a prime role to market the financial sector, a direct conflict is often observed between protecting investors and regulating/promoting an orderly financial market. LuxAlpha (Madoff), Landsbanki, and others have failed to recover any investor monies, despite investor outcry and complaints. [5] [6] [7] [8]

Anti-Money Laundering and Countering the Financing of Terrorism (AML/CTF)

Within the framework of its statutory mission, the CSSF is in charge of ensuring that all the persons subject to its supervision, authorization, or registration comply with the professional AML/CTF obligations. However, recent disclosure about Director General Claude Marx being cited in the Panama Papers as having a key involvement in over 100 offshore companies whilst at HSBC Private Bank, as well as the CSSF's poor track record in addressing AML complaints, have served to undermine its credibility as an AML enforcer. [9]

References
  1. "Home: Commission de Surveillance du Secteur Financier (CSSF)". www.cssf.lu.
  2. "404: Commission de Surveillance du Secteur Financier (CSSF)" (PDF). www.cssf.lu. Archived from the original (PDF) on 2015-09-23. Retrieved 2012-11-01.
  3. "Organisation générale: Commission de Surveillance du Secteur Financier (CSSF)". www.cssf.lu.
  4. "Mission et compétences: Commission de Surveillance du Secteur Financier (CSSF)". www.cssf.lu.
  5. http://www.imf.org/external/pubs/ft/scr/2011/cr11148.pdf
  6. https://www.ft.com/content/0b5f104f-80c5-462f-acd5-4744b5778401
  7. https://paperjam.lu/article/cssf-dans-viseur-administrateu
  8. https://www.investmentofficer.lu/en/news/cssf-fails-enforce-fund-regulation
  9. https://lequotidien.lu/a-la-une/claude-marx-directeur-de-la-cssf-tres-implique-dans-les-panama-papers/
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