The Cayman Islands is going to be included on the European Union’s list of high-risk third countries for money laundering.
The update to the EU AML list reflects the recent changes to the Financial Action Task Force (FATF)’s own grey list, indicating jurisdictions whose AML practices are under increased monitoring. (It is the rule that FATF-listed jurisdictions are included in the EU’s own AML list).
After being listed by the FATF in February 2021 due to deficiencies in the existing AML framework, the Cayman government committed to introducing a variety of measures to improve its position.
In particular, their announced action plan will introduce effective sanctions and penalties for companies whose beneficial ownership information is not up to date.
In 2019, Cayman Islands announced that it intended to introduce a public register of beneficial ownership of all financial entities registered in the country by 2023. The most recent step in that direction took place in September and October 2021, when the government issued a consultation paper on how to improve the country’s beneficial ownership legislation.
Enforcement action is another area of improvement highlighted by the FATF. For this reason, the new action plan will need to cover measures to ensure that money laundering crimes are prosecuted and punished with appropriate penalties.
The earliest opportunity for Cayman to be removed from the FATF grey list is at the end of 2022.
Direct access to reliable information on companies’ ultimate beneficial ownership across jurisdictions is a key step to protect the global financial system from money laundering and terrorist financing.
On 27 January 2022, join us as we explore this topic in detail during an exclusive roundtable in partnership with RegTech Associates and the City of London.
You can request your seat here.
Last updated on March 9th, 2023 at 01:59 pm