Luxembourg’s Financial Intelligence Unit (FIU) will be able to send urgent fraud warnings to cryptocurrency exchanges as well as traditional banks under new legislation coming into force on 8 August.
The measure, known as Bill 8722, gives the FIU authority to issue rapid-response alerts across the country’s financial sector when fraudulent accounts are identified. Crypto exchanges operating in Luxembourg will be required to receive the warnings alongside banks and payment institutions.
The changes are designed to prevent criminals from moving stolen money between financial providers before converting it into digital assets. Previously, banks could block transactions involving suspicious accounts within their own systems, but there was no statutory mechanism allowing them to alert another institution when funds were transferred elsewhere.
That gap became particularly significant as Luxembourg developed into an important European base for cryptocurrency platforms following changes to European Union regulation. Digital wallet providers have become an attractive destination for criminals attempting to turn illicit funds into cryptocurrency.
The legislation follows a major 2024 “CEO fraud” case in which just over $70m was stolen from the humanitarian charity Caritas.
Max Braun, director of Luxembourg’s FIU, said the inclusion of crypto exchanges would make it harder for international fraud groups to withdraw stolen funds.
“It is a new possibility to the FIU toprevent CEO fraud from happening,” Braun told reporters.
He also said the new system would offer important protection from liability for crypto-wallet operators, whose customers are mostly based outside Luxembourg.
The legislation was introduced in March by Justice Minister Elisabeth Margue. Luxembourg’s parliament approved it unanimously in July, and it was published on 4 August in the country’s official gazette, the Journal officiel.
Alerts will be distributed through a secure information-technology system that complies with data-protection requirements. They will be sent directly to authorised financial institutions and cryptocurrency providers operating in Luxembourg.
The FIU held an information session for compliance officers on 6 August, two days before the law was due to take effect, in an effort to ensure the new process could be implemented immediately.
Braun described the expansion of the warning system to cover crypto exchanges as a significant development, but warned that it would not eliminate corporate fraud.
The move comes as reported fraud continues to rise in Luxembourg. Justice Ministry figures show that police recorded 6,382 fraud cases in 2024, an increase of almost 4% compared with the previous year.
Reports of fraud and scams submitted by financial professionals rose by 32% during the same period, reaching more than 18,000 cases.
The FIU operates under the Luxembourg public prosecutor’s office. It has 75 members and is responsible for tackling money laundering, terrorist financing and financial crime.
Luxembourg’s sovereign wealth fund has also become the first in the Eurozone to invest directly in bitcoin exchange-traded funds (ETFs), signalling the country’s growing involvement in digital assets.
