Cayman Islands Tightens Anti-Money Laundering Regulations
Strengthened AML Framework for a Safer Financial Environment
The Cayman Islands has taken significant steps to enhance its anti-money laundering (AML) regulations, with the publication of a revised version of the Cayman Islands Anti-Money Laundering Regulations (AMLR). Effective from January 2023, these changes aim to strengthen the jurisdiction’s AML framework and provide a safer financial environment for individuals and businesses.
Key Changes: Country Risk Assessments Now Mandatory
Removal of Equivalent Jurisdictions List
One of the major changes is the removal of the Anti-Money Laundering Steering Group (AMLSG) list of countries deemed to have an equivalent AML regime to the Cayman Islands. Under the revised regulations, persons carrying on “relevant financial business” in the Cayman Islands must conduct their own risk assessment of each country or geographic area where their customers or applicants for business reside or operate.
- Increased due diligence: Individuals and businesses can no longer rely by default on the Equivalent Jurisdictions List for simplified due diligence or other actions permitted under the AMLR, where a low risk of money laundering or terrorist financing is suspected.
- Customized risk assessments: The revised regulations require persons carrying on relevant financial business to assess country risk based on credible sources related to money laundering, terrorist financing, proliferation financing, corruption, and any other criminal activity.
Additional Requirements Introduced
Transfer of Virtual Assets: Identification and Record-Keeping Requirements
The revised regulations also introduce specific requirements for assessing country risk, including taking account of credible sources related to money laundering, terrorist financing, proliferation financing, corruption, and any other criminal activity. Furthermore, a determination that a low risk of money laundering or terrorist financing exists cannot be made where any specified risk factor is present.
- Transfer of virtual assets: Identification and record-keeping requirements have been introduced for transfers of virtual assets, which impose obligations to collect and record specified information in respect of virtual asset transfers.
- Enhanced transparency: The revised regulations aim to increase transparency and accountability in the transfer of virtual assets, ensuring that individuals and businesses are aware of the risks associated with such transactions.
Ogier Experts Offer Assistance
For individuals and businesses seeking guidance on the revised AMLR, Ogier’s Regulatory team offers extensive experience advising funds and other regulated entities in the Cayman Islands on anti-money laundering matters. The firm’s Regulatory Consulting services provide a range of regulatory consulting services, including Cayman Islands AML audit services.
“We are committed to helping our clients navigate the complexities of the revised AMLR,” said [Name], Partner at Ogier. “Our team is dedicated to providing expert guidance and support to ensure compliance with these new regulations.”
For further information on how Ogier can assist with anti-money laundering matters, please contact [Name] or your usual Ogier contact.