AML/KYC Compliance Requirements for Financial Institutions in Dominica

The government of Dominica has established a regulatory body to prevent and combat money laundering and terrorism financing. The National Committee against Money Laundering and Terrorism Financing is responsible for overseeing the efficient operation of the system, with several governmental agencies designated as competent authorities.

Competent Authorities

In addition to these agencies, any authority with regulatory or supervisory power over an economic sector or activity subject to anti-money laundering (AML) and combating the financing of terrorism (CFT) laws is also considered a competent authority.

The Financial Analysis Unit (UAF)

The Financial Analysis Unit (UAF), attached to the Ministry of Finance, serves as the technical secretary of the National Committee against Money Laundering and Terrorism Financing. The UAF’s primary task is to analyze and submit financial analysis reports to the Public Ministry regarding possible infractions of money laundering and terrorist financing activities.

AML/CFT Compliance Program Requirements

To comply with AML/CFT regulations in Dominica, all regulated entities must develop and implement a compliance program that includes:

• Risk Evaluation: Money laundering and terrorist financing risks must be evaluated.
• Risk Management: Capabilities to manage and mitigate risk must be established.
• Client Due Diligence: Clients must undergo due diligence or enhanced due diligence.
• Ongoing Monitoring: Transactions must be continuously monitored.
• Transaction Registries: Maintenance of transaction registries is required.
• Compliance Officer: A compliance officer with defined functions and responsibilities must be designated.
• Reporting Unusual Transactions: Reporting unusual transactions to the UAF within five business days after the transaction occurred or was attempted.

Suspicious Operations

Regulated entities must report Suspicious Operations to the UAF within five business days after the transaction occurred or was attempted. Suspicious Operations are defined as complex, unusual, significant, or periodic transactions that lack an obvious economic or legal basis.

Guide to Obliged Subjects

The UAF has published a guide to Obliged Subjects, which allows entities to categorize operations that require closer examination to determine if they should report suspicious activities. Each regulatory sector establishes assumptions indicative of characteristics of transactions or operations that can be considered suspicious.

Conclusion

By understanding and complying with AML/CFT regulations in Dominica, financial institutions can mitigate the risk of money laundering and terrorist financing activities and maintain a reputation for transparency and integrity.