Financial Crime World

Cook Islands’ Financial Institutions Meet International Compliance Standards While Prioritizing Client Confidentiality

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The Cook Islands government and financial services industry have made significant strides in recent years to ensure compliance with international requirements on money laundering, tax evasion, and other financial crimes. This effort has culminated in the passage of laws and regulations that meet global standards, while maintaining the jurisdiction’s reputation as a progressive, stable, and safe destination for businesses.

International Compliance Efforts

  • Implemented Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standard (CRS)
  • Mandated automatic sharing of financial information for tax purposes
  • Strengthened Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) framework through the Financial Transactions Reporting Act 2017 and related legislation

Tax Transparency and Compliance

  • Joined OECD’s Inclusive Framework on Base Erosion and Profit Shifting (BEPS)
  • Removed preferential and harmful tax regimes deemed so by the European Union
  • Enhanced reputation as a cooperative jurisdiction for tax purposes

Confidentiality and Privacy

  • Struck a balance between meeting international obligations and preserving individual rights
  • Maintains that only those with lawful need can access personal information, ensuring legitimate confidentiality is protected
  • Does not maintain public registers of beneficial ownership for incorporated entities or trusts

Investigative Powers and Information Sharing

  • Investigative powers in place to address financial misconduct
  • Information obtained will be shared only according to the law
  • Fishing expeditions will not be tolerated

Conclusion

The Cook Islands’ approach to financial compliance should provide comfort to governments, institutions, businesses, and individuals globally when dealing with the jurisdiction’s financial services industry. The credibility of the Cook Islands is enhanced, making it less justifiable for international partners to avoid transactions with Cook Islands businesses due to concerns about money laundering or other financial crimes.

For more information on compliance in the Cook Islands financial services industry, contact our team at Cook Islands Finance.