The Cayman Islands remains on the Financial Action Task Force’s grey list of 23 countries or jurisdictions that are subject to increased monitoring by the global anti-money laundering and terrorist financing watchdog.
Just two countries – Pakistan and Nicaragua – were removed from the grey list following the FATF plenary in Paris, France, which concluded today, Friday, 21 Oct.
The FATF placed Cayman on the grey list in February 2021, citing as reasons for the move a lack of fines and enforcement actions by Cayman’s regulatory bodies. This automatically led to Cayman also being placed on the European Union grey list in February this year.
In a statement issued Friday, the FATF said, since it was placed on the list, Cayman had made a “high-level political commitment” to work with the FATF and the Caribbean FATF to strengthen its anti-money laundering and counter-terrorism regime, and had imposed “adequate and effective sanctions in cases where relevant parties (including legal persons) do not file accurate, adequate and up-to-date beneficial ownership information in line with those requirements”.
It urged Cayman to continue to work on its outstanding “strategic deficiencies”, including by demonstrating, by February 2023, that it is “prosecuting all types of money laundering cases in line with the jurisdiction’s risk profile and that such prosecutions are resulting in the application of dissuasive, effective, and proportionate sanctions”.
Cayman’s Financial Services Minister André Ebanks, who attended the plenary in Paris along with the director of Cayman’s Anti-Money Laundering Unit, Francis Arana, noted that Cayman had moved a step closer to being removed from the list, having now satisfied 62 of 63 recommended actions to improve its anti-money laundering and countering the financing of terrorism regime.
“The commitment and diligence of both our public and private sectors is earning us a stronger reputation as a global partner that stands firm in fighting financial crime,” he said in a statement.
He added, “There is a solid mass of evidence that proves our ongoing commitment to implementing global standards effectively, from our improved policy and legislative framework, to new and enhanced compliance IT systems, to increasing the number of professionals in the public sector who monitor and oversee those compliance systems.”
Ebanks also noted that it was “becoming clearer globally that the Cayman Islands has a legacy image challenge, not a standards and effectiveness difficulty”.
The minister said he felt it was important to attend the meeting in person to convey key data points that demonstrated that Cayman “is not the same as depicted from decades ago”.
Once Cayman meets the final recommended action on money-laundering investigations and prosecutions and is removed from the FATF list, the EU will initiate its steps to also delist the Cayman Islands, Ebanks said.
Cayman Finance CEO Steve McIntosh on Friday issued a statement saying that by meeting FATF’s recommendation to impose adequate sanctions for failure to provide beneficial ownership information, Cayman’s financial services industry had demonstrated its “commitment to meeting the highest global standards for transparency, information sharing and the combatting of international financial crime”.
He noted that the Cayman Islands was one of the first countries in the world to implement “a verified register of beneficial owners, a result of the collaborative relationship between our financial services industry and Government”.
McIntosh added, “On behalf of the entire financial services industry, Cayman Finance wishes to recognise the hard work of the Ministry of Financial Services in implementing the register of beneficial owners and supporting legislation that led directly to today’s positive outcome, as well as the exemplary leadership of the Minister of Financial Services, the Honourable Andre Ebanks, MP.
“Cayman Finance remains optimistic that the ongoing efforts by our authorities to investigate and prosecute money laundering offences in the jurisdiction will lead to our removal from the grey list in due course.”
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