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Cayman Islands Tightens Anti-Money Laundering Regulations in 2023 Revision
A significant overhaul of the Cayman Islands’ anti-money laundering (AML) regulations has taken effect, consolidating multiple amendments made over the past three years into a single document. The revised regulations aim to enhance the island’s AML regime and bring it in line with international standards.
Key Changes in the 2023 Revision
The 2023 revision of the Anti-Money Laundering Regulations (AMLR) combines three previous sets of amendments published in 2020, simplifying compliance for financial institutions operating in the Cayman Islands. The changes introduce new requirements for:
- Country Risk Assessments: Financial institutions must conduct their own risk assessments of each country or geographic area where customers or applicants reside or operate.
- Virtual Asset Transfers: Financial institutions must collect and record specified information on virtual asset transactions, including details about originators and beneficiaries.
- Other areas to strengthen the fight against money laundering and terrorist financing.
Elimination of Equivalent Jurisdictions List
One key amendment eliminates the use of a list of countries deemed to have equivalent AML regimes, known as the Equivalent Jurisdictions List. Instead, financial institutions must conduct their own risk assessments of each country or geographic area where customers or applicants reside or operate.
Country Risk Assessments Requirements
The revised regulations also introduce specific requirements for country risk assessments, which must consider credible sources related to money laundering, terrorist financing, proliferation financing, corruption, and other criminal activities. Institutions cannot assume a low risk of money laundering or terrorist financing if any specified risk factors are present.
Additional Changes
Other significant changes include:
- Eligible Introducer Assurance Letters: The content requirements for eligible introducer assurance letters have been updated.
- Definition of “Family Member” in the Context of Politically Exposed Persons (PEPs): The definition has been clarified.
Ogier Regulatory Team Expertise
The Ogier Regulatory team has extensive experience advising funds and other regulated entities in the Cayman Islands on AML matters. With a comprehensive understanding of the revised regulations, our experts can help clients navigate the new requirements and ensure compliance with anti-money laundering laws.
Get in Touch
For further information or guidance on implementing these changes, please contact the authors or your usual Ogier contact.