Cayman remains on FATF grey list

(CMR) The Cayman Islands has remained on the Financial Action Task Force (FATF) grey list. The FATF has urged the jurisdiction to move swiftly to address strategic deficiencies by February 2023 and to complete its action plan, as all deadlines have now expired.

According to a FATF release on Friday, 21 October, Nicaragua and Pakistan were the only two countries that were on the grey list that has been removed.

Cayman, along with several other countries, remained under increased monitoring, which means the country has committed to resolving the identified strategic deficiencies swiftly within agreed timeframes and is subject to increased monitoring.

Since February 2021, when the Cayman Islands made a high-level political commitment to work with the FATF and CFATF to strengthen the effectiveness of its anti-money laundering and combatting the financing of terrorism and proliferation  (AML/CFT) regime.

The Cayman Islands has taken steps towards improving its AML/CFT regime, including by imposing 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.

According to the FATF, the Cayman Islands should continue to work on implementing its action plan to address its strategic deficiencies, including by demonstrating that Cayman 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.

The FATF and FATF-style regional bodies (FSRBs) continue to work with the jurisdictions as they report on the progress achieved in addressing their strategic deficiencies. The FATF calls on these jurisdictions to complete their action plans expeditiously and within the agreed timeframes.

The FATF said it welcomes their commitment and will closely monitor their progress. The FATF does not call for the application of enhanced due diligence measures to be applied to these jurisdictions. The FATF Standards do not envisage de-risking or cutting-off entire classes of customers but call for the application of a risk-based approach.

The FATF identifies additional jurisdictions, on an ongoing basis, that have strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing. A number of jurisdictions have not yet been reviewed by the FATF or their FSRBs, but will be in due course.

Since the start of the COVID-19 pandemic, the FATF has provided some flexibility to jurisdictions not facing immediate deadlines to report progress on a voluntary basis. The following countries had their progress reviewed by the FATF since June 2022: Albania, Barbados, Burkina Faso, Cambodia, Cayman Islands, Haiti, Jamaica, Jordan, Mali, Morocco, Myanmar, Nicaragua, Pakistan, Panama, Philippines, Senegal, South Sudan, Türkiye, UAE, and Uganda. For these countries, updated statements are provided below. Following review, the FATF now also identifies the Democratic Republic of the Congo, Mozambique, and Tanzania.

The FATF welcomes the progress made by these countries in combating money laundering and terrorist financing, despite the challenges posed by COVID-19.