Dominica’s Financial Watchdogs Crack Down on Money Laundering with Revised Guidelines

Staying Ahead of the Curve in Combating Money Laundering and Terrorist Financing

The Commonwealth of Dominica has issued revised guidelines for financial institutions and scheduled entities to stay ahead of the curve in combating money laundering and terrorist financing. The new rules aim to provide practical assistance in preventing, detecting, and reporting suspicious activities.

International Efforts Inform New Guidelines

The revised guidelines reflect international efforts led by organizations such as:

• Financial Action Task Force (FATF)
• Caribbean Financial Action Task Force (CFATF)
• Basel Statement of Principles

These bodies set standards for member countries to minimize money laundering and terrorist financing risks.

Multi-Faceted Approach to Mitigate Potential Risks

Financial institutions must take a multi-faceted approach to mitigate potential risks, including:

• Identifying and reporting suspicious transactions • Conducting thorough customer due diligence • Providing staff training and education • Maintaining robust record-keeping and internal controls • Recognizing and reporting suspicious activities

Key Principle: “Knowing Your Customer”

A key principle is “knowing your customer,” which involves understanding their business activities and expected financial transactions. Financial institutions are also required to report any suspicious transactions that may indicate money laundering or terrorist financing to the Financial Intelligence Unit (FIU).

Staff Education and Training

Staff education and training play a critical role in identifying and preventing potential money laundering activities. Institutions must provide ongoing training and stay updated with new regulations.

Proper Record-Keeping, Strong Internal Controls, and Effective Communication

Proper record-keeping, strong internal controls, and effective communication channels between different departments are essential for preventing money laundering and ensuring compliance with international standards.

Demonstrating Commitment to High International Standards

The revised guidelines demonstrate Dominica’s commitment to maintaining high international standards and countering criminal activities. The move is seen as a significant step in bolstering the island nation’s anti-money laundering efforts and protecting its financial system from abuse.