Jamaica: Financial Institutions Must Step Up Due Diligence Efforts

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Combating Money Laundering and Terrorist Financing

Kingston, Jamaica - In an effort to combat money laundering and terrorist financing, financial institutions (FIs) in Jamaica are being urged to implement enhanced due diligence procedures for high-risk transactions and customers.

Strengthened Know-Your-Customer Procedures

According to recent regulations, FIs must conduct stricter know-your-customer (KYC) procedures for individuals and businesses involved in high-risk activities, such as those related to foreign countries or linked accounts. This includes:

• Obtaining more detailed information on the customer’s background and reputation
• Implementing management information systems to monitor accounts with greater frequency

Politically Exposed Persons (PEPs)

For PEPs, FIs must obtain adequate documentation, including:

• Certified copies of banking licenses
• Information on ownership, board of directors, and management composition

Additionally, FIs must:

• Determine the source of wealth
• Apply additional oversight to their accounts

Non-Face-to-Face Customers

When accepting business from non-face-to-face customers, FIs must apply equally effective customer identification procedures as for those available for interview. Measures to mitigate risk may include:

• Requesting additional documents
• Applying specific and adequate measures

Reporting Transactions

The regulations require all transactions above certain thresholds to be reported by the required institutions, with some exemptions for embassies, government agencies, and statutory bodies.

Verifying Customers

In verifying customers, FIs must obtain:

• Registered names
• Dates of birth
• Nationalities
• Addresses
• Other identifying information

For partnerships, unincorporated businesses, and companies, additional documentation may be required, including:

• Partnership agreements
• Certificates of incorporation
• Identification documents from at least two directors

Large Corporate Accounts

Large corporate accounts may need to provide additional information, such as:

• The name and address of beneficial owners or persons on whose instructions signatories are empowered to act

Importance of Original Documentation

The regulations emphasize the importance of original documentation where available and independent verification of documentation presented by customers.

Exemptions from Verification Requirements

FIs can refer to the Financial Institutions Act, Building Societies Act, Co-operative Societies Act, or Insurance Act for a list of eligible institutions exempt from verification requirements.

Conclusion

PricewaterhouseCoopers reminds financial institutions that this publication is for general guidance only and should not be relied upon without obtaining specific professional advice.