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Reporting Suspected Financial Crime in the British Virgin Islands
The British Virgin Islands (BVI) is committed to combating financial crime, including money laundering and terrorist financing. As part of this effort, financial institutions and certain businesses are required to report suspicious transactions and activities to the Financial Investigation Agency (FIA).
What Constitutes a Suspicious Transaction?
A Suspicious Transaction is defined as a financial transaction where there are reasonable grounds to suspect that the funds involved relate to the proceeds of criminal conduct.
Who Must Report?
Financial institutions regulated by the Financial Services Commission (FSC) are required to report suspicious transactions. Additionally, non-financial businesses and professions designated by the FSC as vulnerable to money laundering or terrorist financing must also report:
- Real estate agents
- Accountants
- Attorneys-at-law or other independent legal professionals
- Charities, non-profit institutions, associations, or organizations
- Businesses that buy and sell boats, vehicles, jewelry, and other high-value goods
What Must be Reported?
Financial institutions and designated businesses must report suspicious transactions to the FIA if they suspect or have reasonable grounds to believe that funds are related to criminal activity or terrorist financing.
Consequences of Failure to Report
Failing to report suspected financial crime is a serious offense. Individuals found guilty can face fines up to $150,000 or three years’ imprisonment, or both. Corporations found guilty can face fines up to $500,000 or five years’ imprisonment, or both.
Identifying Risk
Financial institutions and businesses must identify potential risks in their transactions and activities. This includes:
- Complex structures that obscure beneficial ownership
- Cash-intensive businesses
- Unusual business relationships or transactions
- Lack of commercial rationale for a transaction
- Requests for secrecy or reluctance to provide information
Key Points for Law Enforcement
Law enforcement agencies should protect the source of the report by not using it as evidence and not revealing it to the suspect. The UK’s Suspicious Activity Report (SAR) regime provides guidance on reporting suspicious activity.
Case Study
Review a sample Suspicious Activity Report and document your actions. If you have any questions or concerns, please seek advice from the FIA or other relevant authorities.