Financial Crime World

Turks and Caicos Islands’ Legal and Institutional Framework for Anti-Money Laundering (AML)

The Turks and Caicos Islands (TCI) has a legal system based on the English model, with a written constitution that protects fundamental rights and freedoms. However, there are areas where improvements could be made to strengthen its anti-money laundering framework.

  • The TCI’s legal system is based on the English model.
  • It has a written constitution that includes provisions for the protection of fundamental rights and freedoms.

Court System

  • The court system comprises:
    • Magistrate’s court
    • Supreme court
    • Court of appeal
    • Privy council in London as the final appellate body

Financial Supervision and Licensing

Financial Services Commission (FSC)

  • The FSC is a statutory body responsible for financial supervision in TCI.
  • It has a board of directors composed of 7 to 9 persons, including:
    • Permanent secretary, finance
    • Managing director of the FSC as ex officio members

Licensing Committee

  • The licensing committee comprises:
    • Ex officio members of the board of the FSC
    • One or more board-nominated appointed members
  • It exercises executive responsibility for licensing and supervision

Anti-Money Laundering Regulations

Proceeds of Crime Money Laundering Regulations (PCMLR)

  • The PCMLR were adopted in 1999, setting out fundamental requirements for the regulated sectors to:
    • Establish and maintain procedures for customer identification
    • Keep records
    • Report internally
    • Provide employee training

Financial Intelligence Unit (FIU)

  • There is no centralized financial intelligence agency in TCI.
  • The financial crimes unit of the police deals with suspicious transaction reports (STRs) and investigates money-laundering offenses.

Criminalization

  • Several overlapping statutory provisions criminalize money laundering, including:
    • Provisions for confiscation or forfeiture of proceeds of crime

Areas for Improvement

Establishment of a Centralized FIU

  • TCI does not have a centralized financial intelligence agency, which can make it challenging to effectively investigate and prevent money laundering.

Civil Forfeiture Regime

  • The absence of a civil forfeiture regime limits the government’s ability to confiscate proceeds of crime.

Limited Use of Account-Monitoring Orders

  • Account-monitoring orders can only be used for foreign tax investigations, which may limit their effectiveness in combating money laundering.

Broad Professional Privileges

  • The relatively broad professional privileges enjoyed by lawyers may impact adversely on money-laundering investigations.