Cayman Islands under scrutiny by task force
THE Cayman Islands have been taken to task by an international organisation – which could potentially require local firms to ‘terminate’ some business relationships connected to the Caribbean jurisdiction.
The Financial Action Task Force has released an updated list of jurisdictions under increased monitoring, which includes the Cayman Islands, Burkina Faso, Morocco and Senegal.
The organisation said jurisdictions on this list were actively working with it to address ‘strategic deficiencies’ in their anti-money laundering and terrorist financing regimes swiftly within agreed timeframes and subject to extra checks.
The Guernsey Financial Services Commission has now amended its handbook on countering financial crime and terrorist financing to reflect FATF’s updated list.
The amendments include the removal of the Cayman Islands from the list of equivalent jurisdictions and its addition to the list of countries and territories which may present a higher risk of money laundering and terrorist financing.
An instruction has also been issued to all specified business setting out steps to be taken before the end of September in respect of business relationships they have which are connected to the Cayman Islands. Similar action is also being taken in the other Crown Dependencies, said the GFSC.
These steps include reviewing relationship risk assessments for all existing business relationships where the Cayman Islands is a relevant risk factor and apply full customer due diligence measures if previous concessions have been used. Mitigation measures should also be taken where the level of risk has changed.
The GFSC also said it recognised there may be ‘exceptional circumstances’ where the amended requirements cannot be completed – but that specified businesses should ‘terminate’ the business relationship where customer due digilence cannot ultimately be completed and consider whether a disclosure should be made to the financial intelligence service, which is part of the Bailiwick’s economic crime division.
‘The commission will review the action taken by specified businesses to comply with this instruction during on-site inspections and by other supervisory means as necessary,’ added the GFSC.
