Jersey’s fifth round mutual evaluation by MONEYVAL marks a significant milestone for the island as an International Finance Centre (IFC). The report, critical for Jersey's global reputation, highlights the island's strong compliance with international financial crime prevention standards, rating Jersey as compliant or largely compliant with 39 out of 40 FATF (Financial Action Task Force) recommendations.
Robust Compliance
Jersey was rated as compliant or largely compliant with 39 out of 40 FATF recommendations, reflecting the island's robust technical compliance. Only one area, recommendation 8 (regarding independent audit functions in financial institutions), was rated as partially compliant.
Effectiveness in Key Areas
The evaluation highlighted Jersey's high level of effectiveness in assessing risks and coordinating responses to financial crime. Notably, Jersey is one of the few jurisdictions worldwide to achieve a high rating in this area. Changes to the structure and resources of the FIU and Economic Crime and Confiscation Unit (ECCU) were crucial in Jersey becoming the top-rated non-FATF country globally for compliance with FATF standards,
International Cooperation
Jersey was commended for its strong commitment to international cooperation, particularly in dealing with mutual legal assistance requests efficiently. However, the report suggests that law enforcement agencies should be more proactive in seeking both formal and informal international cooperation.
Areas for Improvement
The report identified moderate effectiveness in supervision, preventative measures, financial intelligence, and money laundering investigations and prosecutions. It recommends enhancing resources and efforts in these areas to improve outcomes.
Future Focus
Jersey's strategy moving forward will focus on addressing the report's recommendations in these key areas. The island's commitment to ongoing improvement will be crucial in maintaining its position as a leading IFC.
The Role of Technology
Technology is key to keeping up with the increasing demands of regulatory authorities. Automated solutions provide greater scalability and operational efficiencies compared to manual processes and they tend to be far more cost-effective. Having up to date customer records is vital for compliance and Perpetual (p) KYC solutions can automate this process so that even a large volume of customer profiles can be dynamically updated.
Networked (n) KYC streamlines the onboarding process for customers using IFCs to manage their wealth without losing compliance assurance, as the same information does not need to be repeatedly supplied by a customer. KYC information can be sent electronically between different parties such as banks and TSCPs, meaning customers can be onboarded in days rather than months.
Closing Thoughts
The MONEYVAL report not only confirms Jersey's status as a well-regulated and responsible IFC but also serves as a benchmark for future improvements. The evaluation emphasises the importance of continued collaboration among Jersey's financial authorities and industry stakeholders to strengthen the island's defences against financial crime, ensuring its long-term stability and growth in the global financial system.
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