Financial Crime World

Mutual Evaluation Report: Turks and Caicos Islands’ Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) Framework

Summary of Key Points

The Mutual Evaluation Report (MER) evaluates the Turks and Caicos Islands’ compliance with the Financial Action Task Force (FATF) Recommendations. The report highlights significant progress made by the country in addressing its AML/CFT deficiencies.

CDD Deficiencies Addressed

  • Criterion 10.16: Customer Due Diligence (CDD)
    • Deficiency addressed by Legal Notice 134 of 2021, which requires financial institutions to review CDD on existing customers based on materiality and risks.
  • Criterion 10.17-10.18: Simplified CDD Measures
    • No deficiencies cited, as the AML/CFT framework does not allow for simplified CDD measures.
  • Criterion 10.19: CDD Satisfactory Completion
    • Financial institutions are required to complete CDD satisfactorily before establishing a business relationship or carrying out an occasional transaction.

Suspicious Activity Reporting

  • Criterion 10.20: Suspicious Transaction Reporting
    • Although the criterion was rated as met, a deficiency was cited in the Summary of TC deficiencies table in the MER.
    • The AML Code requires financial businesses not to pursue CDD where there is suspicion of ML/TF and believe performing CDD will tip-off the customer.

Deficiencies Addressed via Amendments

  • Turks and Caicos Islands has addressed all deficiencies
    • Via amendments to the AML/PTF Code and Regulations, which have re-defined the term “legal entity” and applied CDD provisions to trusts.
    • The country is now rated Compliant with Recommendation 10 (R.10).

Recommendation 14 (originally rated PC)

  • Addressing Deficiencies
    • Money Transmitters (Amendment) Ordinance 2021, which defines money transmission more broadly.
    • Strengthening of powers to identify and investigate persons carrying out money service business without a licence.

Conclusion

The report concludes that Turks and Caicos Islands has made significant progress in addressing its AML/CFT deficiencies and is now Compliant with several key recommendations.