Financial Crime World

Jamaica Removed from “Grey List” by FATF

KINGSTON, JAMAICA - In a significant boost to the country’s international reputation and economic potential, Jamaica has been removed from the Financial Action Task Force (FATF) “grey list”, effective immediately.

Background

In February 2019, FATF placed Jamaica on the “grey list” due to weaknesses in its compliance with international standards. The country had implemented a series of reforms aimed at strengthening its anti-money laundering (AML) and combating the financing of terrorism (CFT) regime.

Reforms Implemented

Jamaica’s financial assets had grown significantly over the past two decades, but a change in FATF’s measurement of financial assets led to the country being reassessed. The organization found that Jamaica’s financial assets under M3 fell below $5 billion, triggering an assessment by the International Cooperation Review Group (ICRG).

To address this issue, the Jamaican government worked tirelessly to implement reforms aimed at strengthening its AML/CFT regime. Key changes included:

  • Amendments to the Companies Act requiring disclosure of beneficial owners
  • Regulation of the microcredit sector by the Bank of Jamaica (BOJ)
  • Introduction of a risk-based approach to regulating the financial sector

Results

These efforts paid off, with Jamaica achieving compliance with 37 out of 40 FATF recommendations in its December 2023 follow-up report. This represents a significant improvement from January 2017, when Jamaica scored only 23/40.

“We are pleased that our hard work and commitment to strengthening our AML/CFT regime have paid off,” said Finance Minister Dr Nigel Clarke. “This removal from the ‘grey list’ is a major milestone for Jamaica’s economic development and reputation.”

Impact

The FATF’s decision is expected to boost confidence among investors and trading partners, making it easier for Jamaican businesses to access international markets. The BOJ noted that exiting the enhanced monitoring process sends an important signal to correspondent banking partners, who facilitate the transfer of funds internationally.

While Jamaica has been removed from the “grey list”, it can be added back if it fails to maintain the standards achieved in its most recent follow-up report.

Next Steps

The country is set to chair the Caribbean Financial Action Task Force (CFATF) in December and will work on implementing new guidelines surrounding virtual assets. The Jamaica Bankers Association has welcomed the news, saying that financial institutions played a pivotal role in achieving this milestone and will continue to work with stakeholders to ensure ongoing compliance.

Conclusion

Jamaica’s removal from the “grey list” is a significant achievement for the country’s economic development and reputation. It demonstrates the government’s commitment to strengthening its AML/CFT regime and will likely boost confidence among investors and trading partners.