Guernsey To Overhaul AML/CTF Legislation

by Robert Lee, Tax-News.com, London

27 April 2010

The Guernsey Financial Services Commission has announced the launch of a consultation on proposals to overhaul legislation that governs the prevention of money laundering and the financing of terrorism in the island.

The consultation paper proposes extensive amendments, namely to the following legislation:

• The Financial Services Commission (Site Visits) (Bailiwick of Guernsey) Ordinance, 2008;
• The Insurance Business (Bailiwick of Guernsey) Law, 2002;
• The Insurance Managers and Insurance Intermediaries (Bailiwick of Guernsey) Law, 2002;
• The Protection of Investors (Bailiwick of Guernsey) Law, 1987;
• The Banking Supervision (Bailiwick of Guernsey) Law, 1994;
• The Registration of Non-Regulated Financial Services Businesses (Bailiwick of Guernsey) Law, 2008;
• The Regulation of Fiduciaries, Administration Businesses and Company Directors, etc. (Bailiwick of Guernsey) Law, 2000;
• The Criminal Justice (Proceeds of Crime) (Financial Services Businesses) (Bailiwick of Guernsey) Regulations, 2007; and
• The Criminal Justice (Proceeds of Crime) (Legal Professionals, Accountants and Estate Agents) (Bailiwick of Guernsey) Regulations, 2008.

The first part of the consultation discusses harmonizing the Commission’s on-site inspection powers throughout all governing legislation.

The definition of “regulatory laws” is also to be amended to provide a consistent definition across governing legislation. In particular this will improve the Commission’s checks when considering a license, by broadening the pool of relevant contraventions of regulatory laws that the Commission may take into account when considering an application.

It is also proposed that a textual amendment be made to legislation which governs penalties, namely harmonizing the texts of Section 88 of the Insurance Business Law, 2002 and Section 65 of the Insurance Managers and Insurance Intermediaries Law, 2002.

In addition, as part of a larger review of the definition of “FSB Regulations,” the Commission proposes inserting a new provision into the FSB Regulations which enables financial services businesses to disclose information to other financial services businesses and prescribed businesses, where it appears necessary for the purposes of forestalling, preventing or detecting money laundering and terrorist financing. This amendment is supported by the recommendation in recent IMF reports of other jurisdictions that they should consider including explicit provisions to provide for the sharing of information between financial services businesses.

The consultation paper is available on the Commission’s website. Interest parties are asked to submit comments by May 21, 2010.

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