Fighting Financial Crime in the Cayman Islands: Everyone’s Business

The Cayman Islands is a haven for international business and finance, but with that comes a responsibility to prevent financial crimes such as money laundering, terrorist financing, and proliferation financing. The Government of the Cayman Islands has established a robust anti-money laundering (AML) and combating the financing of terrorism (CFT) framework to protect the integrity of the financial system.

Why AML is Everyone’s Business

You may have wondered why certain procedures are in place, such as:

Documentation requirements for bank accounts: Banks require documentation to open an account to verify the identity and legitimacy of customers.
Non-profit organization registration: Non-profit organizations must register with the Government to ensure transparency and accountability.
Regulations for virtual assets: The Cayman Islands has implemented regulations for virtual assets, such as cryptocurrencies, to prevent their use in financial crimes.
Customs procedures: Customs holds on imported goods before releasing them to verify their legitimacy and prevent the smuggling of illicit goods.
Immigration procedures: Immigration asks about countries visited to ensure that visitors do not have ties to terrorist organizations or other illicit activities.

These procedures help protect you, local businesses, and the Islands from financial crimes. It’s essential to be aware of the signs of money laundering, terrorist financing, and proliferation financing.

What is Money Laundering?

Money laundering is the processing of criminal proceeds to disguise their illegal origin. It’s a significant concern for law enforcement and financial institutions worldwide.

What is Terrorism Financing?

Terrorism financing involves providing finance or financial support to individual terrorists or non-state actors, or funding terrorist activities. Unlike money laundering, terrorism financing can come from legitimate sources such as salaries or donations.

What is Proliferation Financing?

Proliferation financing funds the development and movement of items that can be used to manufacture, acquire, possess, develop, export, ship, stockpile, create, or use weapons of mass destruction (WMDs).

Targeted Financial Sanctions

In response to international law violations, targeted financial sanctions freeze assets and impose prohibitions, preventing individuals or entities from benefiting from these funds.

Recognising and Reporting Suspicious Activity

Suspicious activity can be hard to spot, but consider these potential signs:

Unusual buying behavior: A person buying your property doesn’t want their identity revealed.
Inconsistent business practices: A business seems to stay open despite few customers.
Multiple identities: An investor uses multiple birthdates or names.
Suspicious payment offers: Someone offers to pay you $100 for a $1,000 cheque.
Unusual overseas transactions: An overseas buyer wants to purchase a vehicle on behalf of an unnamed person.

Reporting Suspected Crimes

The public is obligated to report all crimes in the Cayman Islands to the Royal Cayman Islands Police Service (RCIPS). If these crimes involve financial matters, contact the RCIPS Financial Crimes Unit at RCIPS.FCU@rcips.ky or +1 345 949-8797.