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Sanctions

AML/CFT Warnings

The Financial Action Task Force (FATF) periodically issues public statements on high risk and non-cooperative jurisdictions. The statement highlights jurisdictions which the FATF has called upon its membership to apply counter-measures to protect the international financial system from potential money laundering and terrorist financing risks.

Additionally, the statement identifies jurisdictions with strategic AML/CFT deficiencies which has not made sufficient progress in reducing the deficiencies or have not provided a high level political commitment to working the FATF through the adoption of an action plan, to correct the deficiencies. The FATF advises its memberships to consider the risks arising from the deficiencies in each country.

The FATF also periodically issues a public statement on jurisdictions and countries which its regards as having strategic AML/CFT deficiencies and which have provided high level political commitments to working towards improving their AML/CFT frameworks and will highlight jurisdictions which has made any significant progress in improving the identified deficiencies. 

The full text of the abovementioned FATF Statements can be found here along with the text of past FATF Statements and Statements issued by other FATF – Styled Regional Bodies (FSRB’s).

The Caribbean Financial Action Task Force (CFATF) is an FSRB, comprising of twenty-nine jurisdictions of the Caribbean Basin. In order to protect the regional financial system from money laundering and financing of terrorism (ML/FT) risks and to encourage greater compliance with the AML/CFT standards, it works with jurisdictions that have strategic AML/CFT deficiencies to address those deficiencies that pose a risk to the international financial system. The CFATF also periodically issues a public statement on such jurisdictions.The full text of the “CFATF Public Statement” is available via the highlighted link to the CFATF website. 

Financial Businesses must regularly review these advisories and lists particularly as there is a legal obligation pursuant to the Anti-Money Laundering and Prevention of Terrorist Financing Regulations 2010 (as amended) in regulation 17 (2) (c) (ii) and (iii) which requires them to establish and maintain policies, systems and controls to prevent and detect money laundering and Terrorist financing which includes aspects to determine whether “a business relationship or transaction, is with a person connected with a country that does not comply, or insufficiently applies, the FATF Recommendations.” This obligation further requires financial businesses to also determine whether “a business relationship or transaction, or proposed business relationship or transaction, is with a person subject to measures for purposes connected with the prevention and detection of money laundering or terrorist financing, imposed by one or more countries or sanctioned by the European Union or the United Nations.”

Therefore, Financial Businesses are advised to take into account the FATF, CFATF, UN, UK and EU advisories and sanctions lists above when considering establishing business relationships with individuals or businesses or transacting business emanating from or destined to, these jurisdictions.

The Anti-Money Laundering and Prevention of Terrorist Financing Code 2011 also stipulate similar requirements to consider the country risk when preparing the risk assessment with respect to a customer. In section 28, Financial Businesses are also required to consider transactions and activity connected with countries which do not or insufficiently apply the FATF Recommendations or are subject to UN or EU countermeasures. A similar obligation exists in relation to persons or entities that are subject to EU or UN sanctions or measures.

Financial Businesses should apply appropriate or enhanced due diligence measures when conducting business with jurisdictions which has been identified by FATF, regardless of whether the FATF has issued a call for action, having regard to the risk involved. This requirement is embedded in regulation 13 of the Anti-Money Laundering and Prevention of Terrorist Financing Regulations 2010 (as amended).

Financial Businesses are also advised to take into account these advisories and list in determining whether particular transactions are suspect and should be reported to the Financial Intelligence Unit. Financial Businesses must further keep, for the required record retention period, records concerning reviews and conclusions reached (regardless of whether an SAR/STR is filed with the FIU)reached in respect of customers and transactions connected with countries which do not, or do not sufficiently apply the FATF Recommendations or are the subject of UN or EU Countermeasures.

Other Links

Financial Action Task Force (FATF)

Caribbean Financial Action Task Force (CFATF)

TCI Financial Intelligence Agency