Financial Crime World

DOMINICA FINANCIAL REGULATORY BODIES ENSURE STABILITY AND TRANSPARENCY IN THE FINANCIAL SECTOR

In an effort to maintain stability and transparency in the financial sector, the Eastern Caribbean Central Bank (ECCB) plays a crucial role in regulating commercial banks and institutions deemed to be carrying on banking business.

Supervision and Regulation

To ensure compliance with established guidelines, licensed financial institutions are required to submit:

  • Monthly returns: Providing essential information to assess their performance
  • Quarterly returns: Enabling the ECCB to monitor business conditions and asset quality
  • Annual returns: Facilitating policy decisions aimed at maintaining a healthy economic environment

In addition to these regular submissions, the ECCB conducts:

  • Periodic visits: Verifying information provided by institutions, assessing risks, and monitoring business conditions and asset quality
  • Risk assessments: Identifying potential threats to stability and addressing them promptly

International Financial Services Sector

The offshore banking sector is governed by Offshore Banking Acts in respective countries, with national regulators taking primary responsibility for oversight. The ECCB provides support and actively monitors developments primarily in the credit unions and insurance sectors, which are supervised by relevant government authorities and single regulatory units established within territories.

Harmonization of Laws and Regulation

To promote stability, confidence, and trust in the financial sector, the ultimate goal is to establish:

  • Harmonized laws: Consistent with international best practices
  • Regulatory and supervisory unit for financial services: In each member state

This move aims to benefit local residents and businesses alike by ensuring a stable and transparent financial environment.

Categorization of Licensed Financial Entities

Licensed financial entities can be categorized into three main types:

Locally Incorporated Institutions

  • Established under the laws of a member country or territory within the ECCU
  • Examples include commercial banks, credit unions, and insurance companies

Foreign-Owned Subsidiaries

  • Licensed entities incorporated outside the region
  • Examples include foreign banks operating in Dominica

Holding Companies

  • Refers to holding companies of licensed financial institutions operating under the Banking Act
  • These companies have a significant influence over the operations of their subsidiaries