Jersey Wins More Praise For Its Anti-Money Laundering Regime

by Robert Lee, Tax-news.com, London

12 April 2001

At the end of last year, we reported that the Jersey Financial Services Commission (FSC) had published a consultation document, entitled Overriding Principles For A Revised Know Your Customer Framework, which is essentially a joint initiative from financial regulators in Jersey, Guernsey and the Isle of Man to bolster their existing anti-money laundering regulations. Now Jersey has been rewarded for its efforts in building a strong anti-money laundering regime with important endorsements from key North American regulators.

According to the FSC, the US Department of State and the Securities Commission in British Columbia have "unanimously highlighted the high standards of the Jersey Financial Services Commission in fighting financial crime and its cooperative approach in working with other regulatory authorities."

Richard Pratt, Director General of the Jersey Financial Services Commission, has welcomed the endorsements, and said in a statement: 'Such reviews by independent international regulators, based on evaluation and practical experience, are tremendously important. They confirm the substantial progress that has been made in the last few years. This gives us great confidence as we prepare further careful measures to further reinforce the quality and standards of our regulatory processes.'

In the 2001 issue of its annual International Narcotics Control Strategy Report, the US Department of State describes Jersey's service industry as "sophisticated", adding: 'Jersey has established a comprehensive anti money laundering programme and has demonstrated its commitment for fighting financial crime. Jersey officials co-operate with international anti money laundering authorities.' The report, which analyses anti-money laundering regimes in the majority of jurisdictions around the world, also notes the recent report carried out by a US, France, Malta, UK team), which described Jersey as "close to complete adherence" to the FATF's forty recommendations on anti-money laundering measures.

In a separate endorsement from Canada, the Director and Chief Litigation Council of the British Columbia Securities Commission have thanked the FSC for extensive assistance over a long period of time with regard to an insider dealing case. The Securities Commission told the FSC: 'As a result of the co-operation of your authority the British Columia Securities Commission was provided with testimony and documents which enabled it to prove that various registrants promoters and lawyers ... were involved in activities which are in breach of our Securities Act. The extent of the co-operation has been remarkable... as a result we have been able to send the message effectively... that use of... the Island of Jersey will not shield {market participants} from breaching the Securities Law of the province of British Columbia.'

These two important endorsements follow a commentary by the US Federal Bureau of Investigation, which in the February 2001 edition of the FBI Law Enforcement Bulletin described Jersey (together with Guernsey and the Isle of Man) as having a 'well regulated financial industry, money laundering legislation in place and a demonstrated willingness to co-operate with and provide assistance to foreign authorities.' The commentary quotes the Jersey authorities as confirming that: 'When there is an international investigation into financial fraud we are not prepared to allow Jersey to be the place where the trail goes cold.'

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