New Caledonia Introduces Anti-Money Laundering Guidelines for Financial Institutions
Strengthening Financial Integrity in the Pacific Region
The government of New Caledonia has introduced new guidelines aimed at preventing money laundering and terrorist financing, further solidifying its commitment to financial integrity in the Pacific region.
AML/CTF Act 2009: A Key Framework for Compliance
The Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Act 2009 requires financial institutions to take measures to detect and deter such activities. The guidelines outline the following key requirements:
- Conduct a risk assessment to identify potential money laundering and terrorism financing risks
- Develop an AML/CTF program to manage those risks
- Appoint a compliance officer to administer the program
- Implement customer due diligence processes, including:
- Customer identification
- Verification of identity
- Suspicious activity reporting
- Auditing
- Annual reporting systems
Exemptions and Supervision
The guidelines also provide for exemptions from certain provisions of the Act, which can be granted by the Minister of Justice for businesses, transactions, products, services, or customers. The Ministry of Justice invites applications for such exemptions and has established a policy outlining the criteria for granting them.
The AML/CFT Supervisory Framework sets out the framework for supervising financial institutions to ensure compliance with the Act. This framework outlines:
- Shared objectives
- Functions
- Powers
- Guiding principles of the three AML/CFT supervisors
- Compliance tools and techniques available to them
Compliance and Enforcement
New Caledonia’s approach to compliance and enforcement is outlined in a document titled “Minimising Harm - Maximising Benefit.” Financial institutions are expected to adhere to these guidelines to maintain their reputation as a safe place for business.
Recent Developments
In recent years, New Caledonia has taken steps to strengthen its anti-money laundering regime. In 2020, the Financial Action Task Force (FATF) conducted a mutual evaluation of the country’s AML/CFT system and provided recommendations on how it could be strengthened.
The FATF report highlighted several areas for improvement, including:
- More effective supervision and enforcement
- Greater cooperation between financial institutions and law enforcement agencies
New Caledonia has accepted these recommendations and is working to implement them.
Conclusion
The new guidelines aim to protect the integrity of New Caledonia’s financial system and prevent it from being used for illicit activities. By adhering to these guidelines, financial institutions can help maintain the country’s reputation as a safe place for business and contribute to the fight against money laundering and terrorism financing.