Financial Crimes and Compliance Take Center Stage in St. Kitts and Nevis
The Financial Services Regulatory Commission (FSRC) has established strict guidelines to combat money laundering and terrorism financing in St. Kitts and Nevis. The Anti-Money Laundering and Countering the Financing of Terrorism legislation (AML/CFT) is enforced by the FSRB, conducting regular examinations to ensure compliance.
Risk-Based Supervision Framework
The commission’s Risk-Based Supervision Framework (RBS) was introduced in May 2015 and revised in June 2017. This framework serves as a blueprint for both off-site and on-site examinations of regulated entities, ensuring they adhere to AML/CFT requirements.
On-Site Examinations
On-site examinations are conducted by FSRB examiners to assess the compliance of regulated entities with relevant legislation, including:
- Financial Services Regulatory Commission Act (FSRC Act)
- Enactments listed in Schedule 1
These exams aim to determine whether entities have established appropriate policies and procedures for identifying and managing risks related to AML/CFT.
Customer Due Diligence
A key aspect of AML/CFT legislation is the requirement for regulated entities to:
- Identify, verify, and monitor their customers
- Identify and monitor beneficial owners (BOs) of legal persons and legal arrangements
- Make available customer information to competent authorities and those conducting due diligence
Examiners review relevant customer files and citizenship by investment applications to ensure that entities maintain adequate Know Your Customer (KYC) and Customer Due Diligence (CDD) documents for BOs.
Documents Required
These documents typically include:
- Passport or identity card copies
- Notarized letters of reference from recognized banking institutions and professional bodies
- Proof of address
- Other relevant documentation
Examiners also assess the entity’s:
- Risk assessments
- Source of funds and wealth declarations
- Account opening files
- Accounting records
- Corporate documents
- Internal controls
Monitoring and Compliance
The results of on-site examinations influence the intensity and frequency of monitoring. Regulated entities operating satisfactorily may require less frequent monitoring than those with identified weaknesses or deficiencies.
FSRB’s Commitment
The FSRB remains committed to ensuring that St. Kitts and Nevis’ financial sector remains a bastion of integrity and transparency, safeguarding against financial crimes and terrorism financing.