Enhanced AML supervisory powers given to CIMA under money laundering legislation

Under recent changes to the Cayman Islands Anti-Money Laundering Regulations (AML Regulations), the powers of the Cayman Islands Monetary Authority (CIMA), as the supervisory authority for anti-money laundering in the Cayman Islands, have been enhanced to allow CIMA to obtain information in relation to any relevant financial business from a broader category of persons than was previously the case.

Additionally, CIMA, any competent authority or government body were given the statutory authority to share or provide information among themselves for the purpose of assessing money laundering or terrorist financing risks, or discharging any function under the Proceeds of Crime Law (the PCL).

Both of these changes demonstrate the Cayman Islands government’s commitment to having an anti-money laundering regime that continuously seeks to employ best practice and ensure effective supervision of the financial services industry in the Cayman Islands.

How were CIMA’s powers enhanced?

CIMA now has the statutory power to request information from the person or entity carrying out relevant financial business, a person connected to the relevant financial business, or a person reasonably believed to have relevant information.  CIMA has also been given the powers to compel any such person to answer its questions, provide documents, statements or any other information requested by it.

What if the person fails to comply with a demand notice?

A person who fails to comply with such a notice from CIMA is liable on summary conviction, to a fine of up to CI$500,000 (approximately US$610,000) or on conviction on indictment, to a fine and to imprisonment for two years.

When can CIMA, any competent authority or government body share information?

CIMA, any competent authority or government body can share or provide information of their own volition or upon request by another Cayman Islands supervisory authority, competent authority or government body.

The information must be shared or provided for the purpose of assessing money laundering or terrorist financing risks or discharging any function under the PCL.

Is there any obligation for CIMA to notify of the sharing of information?

There is no obligation under the AML Regulations for CIMA to notify the provider of information or the relevant financial business that it is sharing information.

Are there any restrictions with respect to shared information?

The recipient of any shared information must only use the information for the purpose for which it was shared, only retain it for as long as necessary, and cannot disclose the information for any other purpose other than that for which it was shared without the consent of the provider.

Harneys’ Regulatory team is well versed in all aspects of Cayman’s AML requirements, so please contact your usual Harneys contact if you would like advice on compliance with the AML regime in Cayman. If you have any other questions, visit harneys.com/Cayman.