Luxembourg Insurance Commission publishes national terrorist financing risk assessment identifying small cross-border transactions as principal threat

The Luxembourg Insurance Commission has published Luxembourg’s 2026 National Risk Assessment of Terrorist Financing, covering 2021 to 2024. It finds that the principal threat comes from lone actors, small cells and foreign terrorist fighters using basic financial products for low-value, mainly cross-border transactions. The threat of large international terrorist organizations moving substantial funds through Luxembourg remains largely theoretical, with no evidence that it has materialized. Existing controls reduce residual risk to low or medium across most sectors. Retail and business banks, online banks, payment and e-money institutions, and virtual asset service providers have high inherent risk and medium residual risk because of their transaction volumes, cross-border reach, speed and limited face-to-face interaction. Life insurance has medium inherent risk but low residual risk. The highest residual risks apply to domestic fiducies, foreign trusts and internationally active nonprofit associations that lack public utility status or development nongovernmental organization accreditation. Priority areas include crypto-assets and self-hosted wallets, unregulated donation-based crowdfunding, virtual IBANs, instant payments, informal transfer systems and artificial intelligence-enabled document fraud. Donation-based crowdfunding platforms remain outside the current supervisory perimeter until the European Union anti-money laundering regulation applies in July 2027.