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Until recently, sanctions for non-compliance with Cayman’s money laundering regulations were also inadequate at providing a credible deterrent. The sanctions have since been raised from US$5,000 to up to US$500,000, however the document provides no detail on whether these increased sanctions have yet been applied in practice.
The report implicitly recognises the dire state of Cayman’s anti-money laundering system when it recommends ‘decisive action’ around practically the entire range of anti-money laundering measures: regulations, supervision, sanctions, intelligence, enforcement, and domestic and international co-operation.
While many other countries have weaknesses when it comes to stopping dirty money, from the United States to Singapore, that is no reason to let any particular country off the hook regarding its own issues, especially, as in the case of the Cayman Islands, one that actively promotes itself as a world leader for financial services.
As local media have also noted, at the end of this year the Cayman Islands will be assessed by the Financial Action Task Force, which will look not just at paper commitments but also at whether Cayman is taking effective action against dirty money in practice.
Cayman authorities have a few months to show they are ready to shape up: as we have recommended previously, one concrete measure they could take is to set up a central public register of beneficial ownership.
Image: Creative Commons BY-NC-SA 2.0, Flickr / Cseeman
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