Financial Crime World

Jamaica’s Financial Institutions Falling Short on Anti-Money Laundering Standards

A recent review by Jamaica’s Financial Intelligence Agency has revealed that the country’s financial institutions are failing to meet international anti-money laundering (AML) and combating the financing of terrorism (CFT) standards. The report identified several deficiencies in the way financial institutions implement customer due diligence (CDD) measures.

Deficiencies in Customer Due Diligence

  • Many financial institutions were not verifying the identity of beneficiaries of life insurance policies.
  • Institutions failed to conduct proper risk assessments or implement adequate risk mitigation measures.
  • Some institutions did not require verification of customer information using reliable identification data sources.

Inconsistencies in AML/CFT Regulations

  • Financial institutions were applying AML/CFT regulations inconsistently, particularly when it came to identifying and verifying the identity of beneficial owners of legal persons.
  • In some cases, institutions failed to conduct proper due diligence on customers who held 10% or more of the ownership structure of a legal person.

Failure to File Suspicious Transaction Reports

  • Some financial institutions did not file Suspicious Transaction Reports (STRs) in circumstances where they suspected a business relationship or transaction was related to money laundering or terrorist financing.

Consequences of Non-Compliance

  • Failure to comply with international AML/CFT standards can increase the risk of money laundering and terrorist financing, which can have serious consequences for Jamaica’s financial system.

Recommendations for Improvement

  • Financial institutions should implement effective CDD measures.
  • Regular risk assessments should be conducted.
  • STRs should be filed in circumstances where there is suspicion of money laundering or terrorist financing.

Call to Action

The Financial Intelligence Agency has recommended that the country’s financial regulators take immediate action to address these deficiencies and ensure that financial institutions meet international standards for AML/CFT compliance. It is crucial that Jamaica’s financial institutions take a more robust approach to AML/CFT compliance to mitigate the risks of money laundering and terrorist financing.