MONEY LAUNDERING SEMINAR YIELDS PRODUCTIVE RESULTS By John Denny Observer Reporter
(Newcastle, Nevis) – Under the theme “meeting International Compliance Standards – Our Caribbean Experience’the Caribbean Financial Action Task Force (CFATF) met at the Mount Nevis Hotel this week to discuss international compliance standards, money laundering and terrorist financing in the Nevis offshore financial industry. Mutual Evaluation Examiner with CFATF, Mr. Robin Sykes said that while the Caribbean continued to stay abreast of best and compliance practices, it must be aware of the wider global issues that were going to affect the financial sectors of the region’s economies in the near future. Taking stock of the money laundering and terror financing situation as it has developed over the past several years has presented challenges to the sector, Mr. Sykes said. “It is important that we look at these challenges regionally because international perception/ press do not usually distinguish between Nevis/British Virgin Islands/St. Lucia etc,”he said. “While jurisdictions with international financial services offerings are competitors, failures in one jurisdiction can and will have contagion and reputation risks for neighboring states.”Marking its silver anniversary, the Nevis financial sector should be proud of how far they have come, Sykes said. “Successful development over 25 years points to a great deal of work to build financial products, build client relationships and to build a regulatory framework that not only facilitates business but that protects the reputation of the state and the sector,”he said. “That’s a massive investment of money and effort. The authorities and the players in the industry are to be congratulated on meeting this memorable milestone.”Mr. Sykes is no stranger the legal framework in the financial sector of the Federation having done the last mutual evaluation. He said he was impressed by the willingness of the sector to adopt recommendations, but also defend the legal framework on points they considered valid. “Our interface also evidenced strong governmental support for the sector. One striking factor to me was the fact that the Authorities took the findings of the report seriously, strongly defending positions regarding the strength of the framework but also looking with a critical eye to the findings and committing swiftly to those corrections that were valid and could improve the system,”he said. “The process was very positive and collaborative. My participation here is a continuation of this collaboration. I also came away from the Evaluation mission with an impression of financial sector professionals who were well aware of the need for a culture of compliance.”Legal Advisor in the Nevis Island Administration (NIA) Hon. Patrice Nisbett made the comment that though the fight against money laundering and terrorist financing was arduous and protracted, continued harmonized efforts by all involved in the battle was key. Nevis has established itself as a reputable international financial center and is determined to develop and expand its role as one of the premier centers in the Caribbean, according to Nisbett. He admitted, no financial center was safe from the threat of misuse by money launders and terrorists of its industry, but the failure to recognize and prevent money laundering and terrorist financing was laden with risks, which came in diverse forms and affected the jurisdiction and industry alike. “There are reputable, operational and financial risks following administrative and regulatory sanctions, ever increasing policy changes, lost income streams and client base as a result of negative exposure. As an international financial center, we have an undeniable interest in combating money laundering and terrorist financing,”he said. Emerging risks through charities or non-governmental organizations, wire transfers and real estate and insurance transactions have been identified by the Task Force which has aggressively promoted awareness of the threats. The Federation is a small jurisdiction, but Counselor Nisbett said we should not be complacent, since money launders and contributors to terrorist were persistent in probing financial systems for loopholes and were creative in their development of new techniques to overpower safeguards. Due diligence and properly trained personnel are the frontline against shady and illegal business practices in the sector, Nisbett said. “Appoint a Compliance Officer who will be the liaison between your institution and the regulator in matters relating to compliance with AML Regulations and other laws with respect to money laundering. Also ensure that your staff, front line staff and those dealing with new customers are trained in your institution’s AML/CFT policies and procedures,”he said. “Get to know key pieces of legislation including their amendments governing AML/CFT matters. Familiarize yourselves with the Proceeds of Crime Act, Financial Intelligence Unit Act and last but not least the Anti-money Laundering Regulations and Guideline notes.”
