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The Cayman Islands is eligible to be removed from a global anti-money laundering ‘grey list’, the president of the global Financial Action Task Force confirmed at a press conference in Paris this morning.
A team of experts will visit the territory for a final on-site inspection later this year and the task force will confirm whether Cayman can be delisted at its October meeting.
The news is a hugely positive development for Cayman’s financial services industry.
Raja Kumar, the president of FATF, told the media that Cayman is one of four countries that have ‘completed their action plans’ and now qualify to come off the list of countries under increased scrutiny.
“Cayman Islands authorities have made substantial progress since their grey listing,” Kumar told the media following the week-long summit in Paris.
“FATF determined that the Cayman Islands has substantially completed its action plan,” he said.
“A team of experts will now go down to the Cayman Islands and confirm and verify the progress that has been achieved and determine the measures put in place are sustainable.”
The islands were grey listed in 2021, following an initial inspection in 2019, that highlighted numerous weaknesses in Cayman’s capacity to fight money laundering and terrorism financing.
Authorities moved swiftly since 2019 to satisfy 62 out of 63 recommendations of the task force, including establishing a new team of experienced financial crime investigators to proactively pursue complex cross-border investigations and seize the proceeds of crime.
New compliance and reporting standards for realtors and precious metal dealers have been introduced as well as tighter monitoring on the beneficial ownership of companies registered in the territory.
The final recommendation was that the islands must demonstrate effective and proportionate sanctions for those convicted of money laundering. The sentence of Canover Watson earlier this year along with the case presented by Cayman officials, including Financial Services minister Andre Ebanks, appears to have gone some way to erasing this final black mark.
Ebanks: Announcement ‘a major step’
Ebanks, in a press-release, welcomed the news but cautioned that Cayman must still come through an on site inspection, expected late August or early September.
“Satisfying all of the 63 recommended actions is a major step towards the Cayman Islands being delisted but, as is the case for other listed countries that met this milestone, there is one more step to complete, and all relevant stakeholders need to remain focused,” he said.
Attorney General Samuel Bulgin, who is in Paris with the minister, said that preparations are already underway for the onsite visit of the Americas Joint Group – a subgroup of the FATF’s International Cooperation Review Group.
He added, “The FATF process is rigorous with reason. Its purpose among other things, is to ensure that local authorities can effectively deter, detect, investigate and prosecute serious crimes.”
The announcement Friday means Cayman has substantively satisfied international regulators that it is doing its part to staunch the flow of dirty cash around the global financial system.
Coming off the grey list – and avoiding further sanctions form FATF – are considered crucial to the long-term wellbeing of the financial services industry, which is the cornerstone of Cayman’s economy and the key contributor to government funds.
Industry group Cayman Finance welcomed the announcement Friday.
CEO Steve McIntosh said, “While we recognise that there remains work to be done during the upcoming on-site inspection, on behalf of the board and members of Cayman Finance, we warmly congratulate the entire government delegation and all those in the many departments and agencies that contributed to reaching this milestone on the road to de-listing.”
Conor O’Dea, Chairman of Cayman Finance, added, “Today’s announcement is testament to the perseverance of our government and private sector. Well done to all involved.”
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