House Approves Proceeds Of Crime Act, 2019 Regulations

Jamaica News: The House of Representatives, on Tuesday (November 5), approved the Proceeds of Crime (Money Laundering Prevention) (Amendment) Regulations, 2019, which aims to strengthen the integrity of Jamaica’s domestic financial system.

The legislation is being amended to make it fully compliant with the Financial Action Task Force (FATF), and effective in the efforts of law enforcement and other stakeholders to stem money laundering.

In his remarks, Minister of National Security, Hon. Dr. Horace Chang, explained that the Proceeds of Crime (Money Laundering Prevention) Regulations, 2007, details the regime applicable to businesses in the regulated sector for the purposes of preventing and detecting money laundering.

He noted that based on a review of the extent of Jamaica’s compliance with the FATF 40 Recommendations, and the level of effectiveness of these systems, the Mutual Evaluation Report (MER) provided suggestions on how the systems could be strengthened.

Dr. Chang pointed out that the report outlines ways to effectively amend the Proceeds of Crime (Money Laundering Protection) Regulations, 2007, to make it fully compliant with the FATF.

“The Report indicated that of the 40 recommendations, Jamaica is partially compliant with 21, and non-compliant with two. As a country, we must address these technical compliance deficiencies with urgency or risk the FATF making a public statement regarding the jurisdiction’s anti-money laundering deficiencies,” he stated.

Some of the recommendations include amending Regulation 3 to specify the timeline (15 days after the end of each month) required for financial institutions to report to the Designated Authority on transactions involving prescribed sums.

The National Security Minister said this provision’s inclusion enhances the Designated Authority’s investigative capability.

Regulation 5 has been amended to include reference to the size and nature of the business in relation to the assessment of the risk. This amendment ensures that the regulated business is applying the compliance requirements using a risk-based approach.

“This means that supervisors, financial institutions and intermediaries identify, assess and understand the money-laundering/terrorism financing risks to which they are exposed, so that they can focus their resources where the risks are highest,” Dr. Chang said.

Additionally, he said the $400,000.00 fine associated with offences breaching the Regulation has also been increased to make it more dissuasive.

For individuals appearing before a Parish Court, the fine is now $3 million dollars, while the sum has been increased to $5 million for a body corporate.

Regulation 7, which deals with identification procedures, business relationships and transactions, has been amended to take into account the application of risk management procedures while the regulated business seeks to identify and verify the applicant.

A new regulation, 7B, has also been inserted in order to protect the integrity of the country’s financial system.

Dr. Chang explained that the current framework does not provide for the application of countermeasures, proportionate to the risks.

“This [new] regulation [7B] sets out what needs to be undertaken when dealing with entities from specified territories, so designated by the supervisory authority. These measures include imposing such limits on those business relationships or transactions; providing reports at more frequent intervals and carrying out additional audit requirements,” he added.

Meanwhile, Dr. Chang said these amendments will strengthen Jamaica’s overall financial system.

“While these amendments will satisfy our international obligations, the intention is for them to be inclusive and to bring informal operations into our formal financial sector,” the Minister said.

He added that the Regulations will allow for the application of different layers of risk assessment and improve the ease of doing business as well as facilitate greater inclusion of a wider cross section of Jamaicans in the local financial sector.



Source: JIS News

Leave a Reply