Financial Crime World

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Cook Islands Establishes Anti-Money Laundering Regime

The Cook Islands has taken a significant step in combating financial crimes by establishing an anti-money laundering regime, which came into effect on June 1, 2003.

Measures Under the Financial Transactions Reporting Act (FTRA)

  • Record-keeping and client identification requirements
  • Reporting of suspicious transactions
  • Cash and electronic funds transfers exceeding $10,000

These measures apply to all reporting institutions as outlined in Section 2 of the FTRA.

Terrorism Financing Offence

In a major development, the Cook Islands has also criminalized terrorism financing under the Terrorism Suppression Act 2004. The act prohibits any person from:

  • Providing or collecting property intending, knowing or having reasonable grounds to believe that it will be used to carry out a terrorist act

Financial Intelligence Unit (FIU) Established

The FIU was established under Section 20 of the FTRA to facilitate the prevention, detection, investigation and prosecution of money laundering, terrorism financing and other serious offences. The FIU is headed by a person appointed by the Attorney General in consultation with Cabinet.

Functions of FIU

  • Receiving reports made under various sections of the FTRA
  • Collecting information from domestic and international sources
  • Referring matters to the Police for investigation if there is reasonable grounds to believe a serious offence has been committed
  • Requesting information from law enforcement agencies and supervisory authorities
  • Analyzing and assessing reports and information
  • Sending suspicious transaction reports to appropriate law enforcement authorities
  • Destroying suspicious transaction reports after six years if no further activity or information is received

Guidelines Issued

The FIU has also issued guidelines for reporting institutions on their obligations under the FTRA, including the requirement to report any suspicious transactions.

Conclusion

The establishment of the anti-money laundering regime and the Financial Intelligence Unit is a significant step in the Cook Islands’ efforts to combat financial crimes and protect its economy.