Financial Crime World

Title: Seychelles Cracks Down on Insider Trading and Market Manipulation: An Overview of the AML/CFT Act

Introduction

In the Indian Ocean archipelago of Seychelles, the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Act of 2020 is instilling greater scrutiny on financial crimes, including insider trading and market manipulation.

Insider Trading and Market Manipulation as Predicate Offenses

In the context of the AML/CFT Act:

  1. **Insider Trading:**occurs when someone trades securities based on material, non-public information (MNPI). Section 3(4)(d) of the Act criminalizes this behavior.
  2. Market Manipulation: entails actions aimed at influencing the price of securities, commodities, or other financial instruments. Similar to insider trading, Section 3(4)(e) designates market manipulation as a criminal offense.

Money Laundering and Terrorism Financing

The AML/CFT Act establishes the following penalties for the cited offenses:

  1. Money Laundering: If someone knowingly or believes that property involves the proceeds of criminal conduct (incl. insider trading and market manipulation), they can be charged with money laundering.
  2. Terrorism Financing: Any individual or entity that provides or collects funds for acts of terrorism, as per the Prevention of Terrorism Act of Seychelles, is subject to terrorism financing charges.

The Role of the Financial Intelligence Unit (FIU)

The Financial Intelligence Unit (FIU) acts as a pivotal player in investigating financial crimes. The FIU’s responsibilities include:

  1. Collecting, analyzing, and disseminating financial intelligence
  2. Working closely with other law enforcement agencies to prevent and identify financial crimes

Penalties for Offenses

The consequences of engaging in insider trading, market manipulation, money laundering, and terrorism financing include severe punishments:

  1. Insider Trading and Market Manipulation: Penalties follow specific regulations within Seychelles.
  2. Money Laundering: A person is guilty of money laundering if they knowingly or believe their property represents the proceeds of a criminal offense.
  3. Terrorism Financing: Convictions result in imprisonment for a term between 7 and 20 years.

Extensive Range of Predicate Offenses

The AML/CFT Act covers a wide range of criminal offenses. Predicate offenses extend to actions:

  • Against any law of the Republic
  • Which would be criminal under foreign laws
  • Not in the public interest, as determined by the Attorney General

Conclusion

The AML/CFT Act of 2020 aims to provide a comprehensive framework for preventing and countering financial crimes in Seychelles, including insider trading and market manipulation. The Act’s stringent regulations and penalties serve as strong deterrents, ensuring a transparent and fair financial sector for all stakeholders.

For more information about the Financial Intelligence Unit, contact them at:

  • Phone: (248) 438-3400
  • Address: P.O Box 7021, Ile Perseverance, Mahe, Seychelles
  • Email: [email@example.com]