St. Christopher and Nevis Financial Services Regulation: Enhanced Due Diligence for Correspondent Banking Relationships
In an effort to strengthen its anti-money laundering and combating the financing of terrorism (AML/CFT) regime, the Government of St. Christopher and Nevis has introduced new regulations governing correspondent banking relationships.
Correspondent Banking Relationships
A correspondent banking relationship involves the provision of services such as bank accounts, funds transfers, or securities transactions. Under the new regulations, correspondent banks are required to:
- Gather sufficient information about their respondents to understand the nature of their business and assess their reputation and quality of supervision.
- Determine whether the respondent’s systems and controls to combat money laundering and terrorist financing are consistent with international standards.
- Obtain senior management approval for establishing business relationships with politically exposed persons.
Politically Exposed Persons
Politically exposed persons include:
- Heads of state, heads of government, senior politicians, senior government officials
- Individuals who hold prominent public positions or have been entrusted with significant authority
- Close associates of such individuals, including family members and business partners
Reduced Due Diligence for Low-Risk Situations
In certain low-risk situations, identification procedures may not be required, including:
- Public authorities acting in their official capacity
- Pension schemes with contributions made by way of deductions from wages
- Insurance businesses with policies containing no surrender clauses and not used as collateral security for loans
- Premiums payable in one installment of an amount not exceeding EC$5000.00
- Periodic premiums payable with a total amount payable exceeding EC$5000.00
Enhanced Ongoing Monitoring
The regulations also require correspondent banks to conduct enhanced ongoing monitoring of high-risk business relationships, including those with politically exposed persons.
Effective Date and Compliance
The new regulations will come into effect on [insert date] and apply to all banks operating in St. Christopher and Nevis. Financial institutions are advised to review their existing policies and procedures to ensure compliance with the new requirements.
Contact Information
For more information, please contact:
- [Insert name], Financial Services Regulation Department
- Phone: [insert phone number]
- Email: [insert email address]
These new regulations demonstrate the country’s commitment to maintaining a robust AML/CFT regime and ensuring that its financial institutions are compliant with international standards.