Financial Crime World

Banking Compliance Regulations in St. Kitts and Nevis: A Closer Look

Strengthened Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) Regulations

The Federation of St. Kitts and Nevis has recently aligned its anti-money laundering (AML) and combating the financing of terrorism (CFT) regulations with international standards. The Financial Services Regulatory Commission (FSRC), responsible for regulating and supervising financial institutions in the country, employs a risk-based supervision framework to ensure compliance.

Regular On-Site Examinations

The FSRC conducts comprehensive on-site examinations of regulated entities to assess their AML/CFT compliance and overall financial soundness. These examinations involve:

  • Reviewing customer files
  • Evaluating citizenship by investment applications
  • Assessing policies, practices, procedures, and internal controls for AML/CFT compliance

Key Compliance Requirements

Regulated entities in St. Kitts and Nevis are required to:

  • Identify, verify, obtain, maintain, and monitor customers and beneficial owners of legal persons (companies) and legal arrangements (trusts)
  • Make available customer information to competent authorities and those conducting AML/CFT due diligence
  • Maintain up-to-date Know Your Customer (KYC) and Customer Due Diligence (CDD) documents for beneficial owners

Examination Process

During an on-site examination, FSRC examiners review:

  • Relevant customer files
  • Citizenship by investment applications
  • Policies, practices, procedures, and internal controls for AML/CFT compliance
  • Training schedules, suspicious transaction reporting, record keeping systems, retention period, and condition of records

Monitoring Frequency

The results of an on-site examination influence the intensity and frequency of monitoring. Entities operating in a satisfactory manner will require less frequent monitoring than those with weaknesses and deficiencies.

By implementing robust AML/CFT regulations and conducting regular on-site examinations, St. Kitts and Nevis aims to maintain a secure financial environment and prevent illicit activities. Regulated entities are expected to comply with these regulations to avoid reputational damage and potential penalties.