Financial Crime World

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Financial Crimes Definition in Saint Kitts and Nevis

The St. Kitts and Nevis government has implemented robust measures to combat financial crimes, including money laundering and terrorism financing.

Money Laundering Definition

According to the Proceeds of Crime Act, Cap 4.28, money laundering is defined as conduct where a person engages directly or indirectly in a transaction that involves money or other property that is the proceeds of crime.

Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) Legislation

The AML/CFT legislation applies to all regulated businesses in St. Kitts and Nevis. The Financial Services Regulatory Commission (FSRC) has responsibility for regulating and supervising regulated businesses’ compliance with AML/CFT requirements.

Risk-Based Supervision Framework (RBS)

In May 2015, the FSRB adopted a Risk-Based Supervision Framework (RBS), which is applicable to both off-site and on-site examinations of regulated entities. Comprehensive and regular on-site examinations are conducted to ensure that regulated entities comply with the Act, AML/CFT legislation, and enactments specified in Schedule 1.

On-Site Examination

During an on-site examination, examiners from the FSRB determine whether there are appropriate policies and procedures established to ensure compliance with AML/CFT legislation and identify risk appropriately. The examiners review relevant customer files of the regulated entity as well as citizenship by investment applications to ensure that adequate Know Your Customer (KYC) and Customer Due Diligence (CDD) documents for beneficial owners (BOs) of legal persons and legal arrangements are obtained and kept up-to-date.

KYC and CDD Documents

Such documents include:

  • Proof of identity
  • References
  • Proof of address

In addition to customer files, examiners conduct assessments of the regulated entity’s policies, practices, procedures, and internal controls for compliance with AML/CFT legislation, including:

  • Ongoing monitoring programs
  • Training schedules
  • Suspicious transaction reporting
  • Record-keeping systems
  • Retention periods
  • Conditions of records

Results of On-Site Examination

The results of an on-site examination influence the intensity and frequency of monitoring. Entities that operate in a satisfactory manner will require monitoring on a less frequent basis than entities with weaknesses and deficiencies.

Enforceable Guidelines/Regulations

Enforceable guidelines/regulations on anti-money laundering and anti-terrorism include:

  • Anti-Money Laundering Regulations 2011
  • Anti-Terrorism (Prevention of Terrorist Financing) Regulations 2011
  • Financial Services (Implementation of Industry Standards) Regulations, 2011
  • Anti-Terrorism De-Listing Procedures Regulations, 2011

Financial Intelligence Unit (FIU)

The Financial Intelligence Unit (FIU) plays a crucial role in detecting and combating financial crimes. The FIU is responsible for:

  • Receiving, collecting, analyzing, and acting upon reports of suspicious transactions from regulated businesses
  • Performing investigations
  • Establishing a database for detecting money laundering
  • Disseminating information on suspicious transactions to competent authorities
  • Liaising with other anti-money laundering intelligence agencies

Reporting Suspicious Transactions

All regulated businesses are required to report suspicious transactions to the Financial Intelligence Unit (FIU). Failure to report suspicion of money laundering is an offense under the Proceeds of Crime Act, Cap 4.28.