Financial Crime World

Here is the article in markdown format:

Virgin Islands Money Laundering Risk Assessment 2022

============================

A comprehensive review of the Virgin Islands’ money laundering and terrorist financing risks has been conducted by the BVI Financial Services Commission’s (FSC) Anti-Money Laundering and Terrorist Financing Coordination Unit.

Key Findings

The assessment identified significant vulnerabilities in the financial sector, including:

  • Complex legal structures and international transactions
    • High-risk customers, including Politically Exposed Persons (PEPs)
    • Cross-border business activity
    • Concealment of assets and identities
    • Limited transparency and regulatory oversight
  • Legal persons, such as companies and limited partnerships, are the subject of a significant number of Suspicious Activity Reports (SARs) filed with the Financial Intelligence Agency (FIA).
  • Business Companies Limited Partnerships and Trusts were found to be more susceptible to money laundering risks due to their complex structures and potential for anonymity.
  • Emerging products and technologies, such as Decentralized Financial Products (DeFi), pose a significant risk of money laundering and terrorist financing.

Highlights

  • The review identified legal persons, such as companies and limited partnerships, as the subject of a significant number of Suspicious Activity Reports (SARs) filed with the Financial Intelligence Agency (FIA).
  • Business Companies Limited Partnerships and Trusts were found to be more susceptible to money laundering risks due to their complex structures and potential for anonymity.
  • Emerging products and technologies, such as Decentralized Financial Products (DeFi), pose a significant risk of money laundering and terrorist financing.

Recommendations

To mitigate these risks, the FSC is urging all regulated sectors to:

  • Review and adjust policies, procedures, and internal controls
  • Enhance monitoring of clients based on risk
  • Demonstrate understanding of client behavior and ability to identify potential areas of concern
  • Implement institutional risk assessment frameworks
  • Ensure timely and accurate submission of statistical returns
  • Maintain adequate procedures and controls for verification and maintenance of information

Call to Action

The BVI Financial Services Commission is calling on all regulated sectors to take immediate action to address these identified risks. The full report can be accessed at bvifsc.vg/risk-assessments.

Contact

For more information, please contact the BVI Financial Services Commission’s Anti-Money Laundering and Terrorist Financing Coordination Unit at aml@bvifsc.vg.