Title:Saint Lucia’s Money Laundering Prevention Guidelines: Businesses Brace for Compliance

Regulation Background

• Saint Lucia’s Attorney General enacted the Money Laundering (Prevention) (Guidelines for Other Business Activity) Regulations 2012, effective from August 10, 2012. (Section 43 of the Money Laundering (Prevention) Act No. 8 of 2010)
• Intended to regulate various business activities and set penalties for non-compliance with international best practices against money laundering.

Scope and Consequences of Non-Compliance (Schedule 2 of the Act)

• Businesses designated by the Financial Intelligence Authority (FIA) are regulated by these guidelines. (Breach of Regulations)

Implementing Guidelines and Best Practices

1. Duty of Vigilance

   • Establish systematic employee evaluation and screening procedures.
   • Regular performance assessments and adherence to a code of ethics.

2. KYC (Know Your Customer) Measures

   • Verify customer identity.
   • Maintain business relationship records.
   • Report suspicious transactions to the FIA.

3. Designating a Compliance Officer

   • Financial institutions must appoint a Compliance Officer. (Role and Responsibilities)

Regulation Background (Detailed)

[Section 43 of the Money Laundering (Prevention) Act No. 8 of 2010] The Money Laundering (Prevention) (Guidelines for Other Business Activity) Regulations 2012 are established under the Money Laundering (Prevention) Act No. 8 of 2010. These guidelines aim to regulate various business activities and set penalties for non-compliance with international recommendations from the Financial Action Task Force (FATF) and the Caribbean Financial Action Task Force (CFATF).

Scope and Consequences of Non-Compliance (Detailed)

[Schedule 2 of the Act] Businesses designated by the Financial Intelligence Authority (FIA) as providing specific services, as outlined in Schedule 2 of the Act, are governed by these guidelines. Breaching the regulations may result in a fine of up to one million dollars.

Implementing Guidelines and Best Practices (Detailed)

The Duty of Vigilance

Businesses should:

• Establish systems to evaluate the personal and financial history of employees (incl. screening procedures).
• Perform regular performance assessments.
• Maintain a high standard of integrity within the organization (code of ethics).

KYC (Know Your Customer) Measures

Businesses should:

• Determine customers’ true identities.
• Maintain records of business relationships.
• Report any suspicious transactions to the FIA.
• Voluntary disclosure of suspicious activities is protected from breach of confidentiality.

Designating a Compliance Officer

As per Section 16 (1) (n) of the Act, Compliance Officers must be appointed by financial institutions to handle internal reporting procedures regarding suspected money laundering activities.

The Duty of Vigilance (Detailed)

Employee Screening

1. Background Checks
   • Criminal record checks.
   • Checks with credit reference agencies.
   • Professional and educational checks.
2. Verification of References
   • Personal and professional references.
   • Contacting employers for confirmation and verifying employment history.
3. Health Checks and Drug Testing
   • Regular health checks.
   • Drug and alcohol testing.

The Compliance Officer (Role and Responsibilities)

1. Implementation of Policies
   • Development and implementation of anti-money laundering policies, programs, and procedures.
2. Reporting to the FIA
   • Analysis of transactions.
   • Review of reports.
   • Conducting investigations as directed by the FIA.
3. Maintaining Knowledge
   • Keeping up-to-date with local and international money laundering trends.
   • Reporting significant money laundering activities to senior management and other relevant individuals.
   • Conducting internal and external training and awareness programs.

Penalties

Failure to comply with these regulations may result in severe penalties, including fines of up to one million dollars.