Financial Crime World

Here is the rewritten article in markdown format:

Turks and Caicos Islands’ Compliance with Anti-Money Laundering and Combating Terrorism Financing Standards

The Financial Action Task Force (FATF) has released a Mutual Evaluation Report (MER) for the Turks and Caicos Islands (TCI), assessing its compliance with various anti-money laundering and combating terrorism financing (AML/CFT) standards.

Compliance Status

The report highlights the TCI’s progress in addressing deficiencies and improving its AML/CFT framework. The key findings are as follows:

R.10: Beneficial Ownership

  • The TCI has addressed all deficiencies via amendments to the AML/PTF Code and Regulations, making it compliant.

R.14: Customer Due Diligence

  • Initially rated PC (Partially Compliant), the TCI has made progress in addressing technical deficiencies, but some issues remain.

Key Findings

The report highlights several key findings related to customer due diligence:

Customer Due Diligence (CDD)

  1. Implementation of Regulation 11(c): The TCI has implemented a regulation requiring financial institutions to review CDD for existing customers based on materiality and risk.
  2. Enhanced Due Diligence (EDD): Financial institutions are required to apply EDD measures for specific listed situations and circumstances that present a higher risk of money laundering/terrorist financing.
  3. Simplified Customer Due Diligence: There are no provisions allowing financial institutions to apply simplified CDD measures.
  4. Failure to Complete CDD: Financial institutions shall not establish business relationships or carry out occasional transactions without satisfactory completion of CDD.

Deficiencies

The report identifies two key deficiencies:

Deficiency 1: Failure to Implement Paragraph 32A

  • A deficiency was cited in the Summary of TC deficiencies table regarding Paragraph 32A of the AML Code, which requires a financial business not to pursue CDD where there is a suspicion of money laundering/terrorist financing.

Deficiency 2: Lack of Proactive Measures for MVTS Business

  • The TCI has not implemented proactive measures to identify natural or legal persons carrying out Money Value Transfer Services (MVTS) business without a license.

Recommendations

The report provides the following recommendations to address the identified deficiencies and ensure full compliance with FATF standards:

  1. Implement measures to address identified deficiencies: Conduct a thorough review of MVTS regulations to align them with the FATF Standards.
  2. Conduct a thorough review of MVTS regulations: Ensure that all financial institutions are in compliance with the updated regulations.

These recommendations aim to strengthen the TCI’s AML/CFT framework and promote international cooperation in combating money laundering and terrorist financing.