Financial Crime World

Turks and Caicos Islands’ Anti-Money Laundering/Countering the Financing of Terrorism Framework

Fourth Round Mutual Evaluation Report by the Caribbean Financial Action Task Force (CFATF)

The CFATF has released a Fourth Round Mutual Evaluation Report on Turks and Caicos Islands, assessing its Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) framework against international standards. The report highlights key improvements made by the country in addressing deficiencies and upgrading its rating.

Key Improvements

Customer Due Diligence

  • Criterion 10.16: The deficiency in customer due diligence (CDD) has been addressed through Legal Notice 134 of 2021, which requires financial institutions to review CDD on existing customers based on materiality and risk.
  • Criterion 10.17: Enhanced Due Diligence (EDD) measures are applied for specific listed situations or circumstances that present a higher risk of money laundering/terrorist financing (ML/TF).
  • Criterion 10.18: There are no provisions allowing FIs to apply simplified CDD measures.
  • Criterion 10.19: Failure to complete CDD does not establish a business relationship, carry out an occasional transaction, or terminate the business relationship; instead, it may lead to making a suspicious transaction report (STR).
  • Criterion 10.20: Although rated as met, a deficiency was cited in the Summary of TC deficiencies table regarding paragraph 32A of the AML Code, which requires not pursuing CDD where there is suspicion of ML/TF and performing CDD would tip-off the customer.
  • Technical deficiencies in pro-active measures have been addressed through amendments to the Money Transmitters Ordinance, which broadened the definition of money transmission and imposed penalties for unlicensed MVTS.

Conclusion

The report concludes that Turks and Caicos Islands has successfully addressed all deficiencies via amendments to its AML/CFT framework. As a result, the country’s rating for Recommendation 10 is upgraded from Partially Compliant (PC) to Compliant (C).