The case dates back to a series of property transactions carried out in 2017. In January 2024, the public prosecutor's office accused notary Karine Reuter of having failed to meet her obligations under anti-money-laundering rules in relation to those transactions.
The accusations concerned, among other things, know your client (KYC) checks on beneficial owners, the origin of the money, the risk assessment carried out, and the question of whether a so-called suspicious transaction report should have been filed with the CRF.
The Court of Appeal has largely revised the verdict against notary Karine Reuter. At first instance, she had been convicted on five counts of breaching Luxembourg's anti-money-laundering legislation and ordered to pay a fine of €100,000. The Court of Appeal has now acquitted her on four of the five counts.
The judges concluded that while the notary had not carried out every step perfectly, she had, on the whole, met her duty of care as it stood under the rules applicable in 2017.
The one point of criticism that was upheld concerned a complex real estate transaction involving offshore companies and large money transfers, which she had failed to report to the judicial Financial Intelligence Unit (CRF). The court underlined, however, that there was no evidence of actual money laundering.
Since only one breach was confirmed, the fine was reduced from €100,000 to €15,000.
The case dates back to the sale of a house in 2021. Two buyers stood accused of exploiting the vulnerability of an elderly man with cognitive limitations in order to buy his house for €200,000, although an expert valuation put its market value at around €828,000. Both buyers were also convicted at second instance of the abuse of a victim in a state of weakness.
The notary's role in the case had been to sign off on the transaction. The court took the view that the many irregularities surrounding the deal amounted to sufficient grounds for suspicion, and that a report should have been filed with the CRF.
Unlike the first case, the Court of Appeal largely confirmed the first-instance judgment. Notary Karine Reuter was fined for breaching anti-money-laundering legislation. The appeal court upheld the first-instance ruling, but reduced the fine from €20,000 to €15,000.
The appeal court concluded that the unusual circumstances surrounding the transaction, including a sale price well below market value, the seller's advanced age and fragile health, and the exceptionally swift completion of the deal, together constituted sufficient grounds for suspicion. The notary should therefore have filed a suspicious transaction report. The court also rejected the argument that the law was insufficiently precise in its wording and therefore incompatible with the constitution or European law.
