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Top five stories you may have missed

Top five stories you may have missed

5 min. 20.05.2022
In case you missed them, the Luxembourg Times has selected the best stories of the week for you
Clearstream Bank CEO Philippe Seyll speaks earlier this month
Clearstream Bank CEO Philippe Seyll speaks earlier this month
Photo credit: Emery P. Dalesio

Court fight over NSO as EU parliament probes spyware

A probe into the unlawful use of Israeli firm NSO's spyware might come to nothing if its previous managers succeed in grabbing back control of the company before a Luxembourg court, a consultancy acting on behalf of the current owners has told the European Parliament.

The Parliament, which set up a committee to investigate NSO in April, could be an influential ally for the Berkeley Research Group (BRG), which is managing the €1 billion private equity fund owning a majority stake in NSO, while at the same time probing if what it did was legal.

The fight over control of NSO continued in a Luxembourg court on Monday, with BRG arguing its ouster could frustrate its clients' probe into NSO, and this could hamper the work by the committee, led by Jeroen Lenaers, a Dutch member of the European Parliament for the centre-right EPP faction.

NSO Group had "ignored" or "frustrated" inquires into its "lawfulness", including as to whether the company is complying with a US blacklisting that came into effect in November last year, BRG said in a letter to Lenaers's group dated 21 April, seen by the Luxembourg Times.

US university ending business courses in Luxembourg

US-based Sacred Heart University will shut down its Luxembourg campus in six weeks as it increases its focus on online education for business students, the university's head of campus said on Wednesday. 

The university based in Fairfield, Connecticut, has offered business courses in Luxembourg since 1991 and currently confers a masters in business administration, using meeting resources at the Luxembourg Chamber of Commerce in Kirchberg.

Enrollment is more than a 100 students of 40 nationalities at the campus in Kirchberg - nearly half of whom will complete their studies by the end of this month, university campus head Antoine Rech told Luxembourg Times on Wednesday.  

Sacred Heart also operates a campus in Dingle, Ireland, primarily offering undergraduate courses in nursing, marketing, social work and criminal justice. That campus will remain open, the university's spokesperson said.

Cases traipse through Luxembourg courts, EU finds

The time it takes Luxembourg courts to resolve civil cases has more than doubled over the past decade, the European Commission has found, underscoring often-heard criticism about the slow pace of the legal system in the world's second-largest fund management centre.

It takes up to a year-and-a-half to resolve administrative cases, a new report from the Commission has found, making it the eighth-slowest across the bloc, and more cases are entering the legal system than are being resolved.

Last year, Luxembourg prosecutors handed out the first indictments in the Bernard Madoff fraud case after a criminal investigation had been simmering for over 10 years, despite the fact that damages from the Ponzi scheme amounted to €1.5 billion in the Grand Duchy alone. Madoff, who ran a $65 billion (€58 billion) Ponzi scheme, died in jail in America just a month earlier.

Transparency International has ranked Luxembourg as having "little to no enforcement" of foreign bribery and said no cases had commenced in the three years from 2016, with just one case leading to sanctions.

Luxembourg funds down 5% from all-time peak

Funds registered in Luxembourg lost €340 billion in value since they reached an all-time peak of more than €5.9 trillion in December, the Association of the Luxembourg Fund Industry (ALFI) said on Tuesday.

Assets held were worth short of €5.6 trillion at the end of March, a downturn of more than 5% since December's high watermark, ALFI said in citing figures by industry regulator CSSF.

The war in Ukraine caused market volatility, and high inflation and the automatic indexation of wages in Luxembourg also posed a concern to the fund industry, ALFI general director Claude Thommes said in February.

He had predicted that Luxembourg funds were likely to continue their losses in the first quarter after the industry registered a drop of €180 billion at the end of January compared to December.

However, the March level is still 5.7% higher than it was a year ago, ALFI said.


War strains Luxembourg's investment-flows powerhouse

Russia’s war against neighbouring Ukraine has meant longer hours, added pressure and intense scrutiny for Luxembourg-based Clearstream, one of the world’s essential securities-trading middlemen.

The EU, the US, Japan and others have unleashed round after round of sanctions to weaken Russia’s financial system after the start of the war, leaving Clearstream to find a balance in applying restrictions on the €13 trillion that will flow through its computer systems this year.

The company is one of the world’s primary firms ensuring custody and payments for security trades, and it needs to show that its interpretation of sanctions is both accurate and fair, Clearstream Banking CEO Philippe Seyll told the Luxembourg Times. That could include having to go to court.

“It's quite stressful for us and the staff,” Seyll said. To cope with the pressure, “we have increased the staffing in those areas that have to deal with the sanctions. It is not neutral on the organisation."

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