Financial Crime World

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Virgin Islands’ Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) Framework

Overview

The report discusses various aspects of the Virgin Islands’ AML/CFT framework, highlighting areas for improvement in different sectors.

Areas for Improvement

  • Financial institutions
  • Trust and corporate service providers
  • Insurance business
  • Insolvency business

Office of the Director of Public Prosecutions (ODPP)

The ODPP has been improving its responsiveness to the ITA’s requests for assistance in international cooperation. However, there is still room for improvement.

Key Findings

  • The ODPP requires improvement in its response to international cooperation requests.

Financial Institutions

The report discusses various areas of concern regarding financial institutions (FIs), including:

Concerns

  • Corporate governance issues
    • Insufficient corporate governance structures
    • Lack of independence among board members
  • Beneficial ownership and client verification/CDD measures
    • Inadequate verification procedures for high-risk clients
    • Failure to obtain necessary documentation from third parties
  • AML/CFT internal control measures
    • Ineffective risk assessments
    • Failure to implement adequate monitoring systems
  • Risk assessment measures
    • Insufficient risk assessments for new business relationships
    • Failure to update risk assessments regularly
  • Filing of Suspicious Activity Reports (SARs) and Suspicious Transaction Reports (STRs)
    • Failure to file SARs/STRs in a timely manner

Areas of Strength

  • Most FIs have sufficient and effective AML/CFT internal controls in place.

Trust and Corporate Service Providers

TCSPs are regulated under the Banks and Trust Companies Act, 1990, and related legislation. Areas of concern include:

Concerns

  • Over-reliance on third parties to obtain relevant client information
    • Failure to verify client information through independent sources
    • Lack of due diligence procedures for high-risk clients
  • Ensuring accessibility of records
    • Inadequate record-keeping systems
    • Failure to maintain accurate and up-to-date records
  • Applying risk assessments and filing SARs/STRs
    • Failure to conduct adequate risk assessments
    • Failure to file SARs/STRs in a timely manner

Insurance Business

Insurance business is licensable under the Insurance Act, 2008, and related regulations. Areas of concern include:

Concerns

  • Maintaining readily available beneficial ownership information in the Territory
    • Inadequate record-keeping systems
    • Failure to maintain accurate and up-to-date records
  • Filing SARs/STRs (27% of insurers do not maintain records of one-off transactions)

Insolvency Business

Insolvency practitioners are licensed under the Insolvency Act, 2003, and required to maintain AML/CFT systems and controls. Areas of concern include:

Concerns

  • Maintaining CDD/ECDD and client information in the BVI
    • Inadequate record-keeping systems
    • Failure to maintain accurate and up-to-date records
  • Filing SARs/STRs (no records of one-off transactions maintained by some practitioners)