TCI Amends Ordinance to Combat Illicit Financial Activities

TCI Amends Ordinance to Combat Illicit Financial Activities

The TCI Government has amended the Invest Turks and Caicos Islands Agency Ordinance to empower the agency to develop stringent due diligence policies in an effort to combat money laundering, terrorist financing, and other illicit financial activities.

The move came in the wake of the arrest of Sam Bankman-Fried, founder and CEO of the cryptocurrency exchange FTX which collapsed in November 2022. He was indicted on multiple criminal fraud charges levied by the U.S. Attorney of the Southern District of New York, Damian Williams. Williams called Bankman-Fried’s actions “one of the biggest financial frauds” in American history.

Hon. Erwin “Jay” Saunders, Minister of Finance, Investment, and Trade, stated when he presented the Invest TCI Agency (Amendment Bill 2022) to the House of Assembly on Tuesday, December 13, that “it is becoming harder and harder to stop and prevent illegal financial activities” because of the numerous ways money moves around the world.

He emphasized that governments around the world have been strengthening their “Know Your Customer (KYC)” policies and regimes, and by extension, their due diligence procedures, in an effort to combat illegal activities such as the movement and/or hiding of money, money laundering, terrorist financing, tax evasion, and other illicit acts.

The Finance Minister emphasized that Invest TCI will also be able to charge fees for conducting Due Diligence checks thanks to the amendments.

Due diligence is a deep dive into a company or individual’s economic, legal, financial, and other financial circumstances. A step that is necessary to be taken prior to entering into an agreement with such parties.

Saunders said “this covers things like sales figures, the structure of shareholders, and possible connections to crimes.”

The amendments to the bill will also guarantee that the Invest TCI’s KYC and Due Diligence policies adhere to AML guidelines and meet global standards.

The Minister stated, “For the benefit of this honorable house and the general public who is presently observing, the term “Anti Money Laundering” refers to the laws, regulations, and procedures that are intended to identify and uncover efforts to conceal illicit funds and make them appear legitimate.”

“Mr. Speaker, activities like tax evasion, drug trafficking, public corruption, and the financing of terrorist organizations are all examples of money laundering.”

In this way, Clause 3 of the Bill sought to change section 6 of the Ordinance so that Invest TCI could help with the due diligence for investment-related Immigration Ordinance permit applications.

“To be clear, Mr. Speaker, this is a function that Invest TCI already carries out, and the purpose of this amendment is to formally and legally grant the agency authority to carry out such a function.

“Mr. Speaker, Clause 4 of the Bill seeks to amend the Ordinance to insert a new section 31A to provide for the making of policies, with a specific mention of a policy to conduct due diligence procedures on investors and on individuals seeking concessions, grants, benefits, or any reliefs under specific Ordinances,” reads the bill’s title.

Investing in TCI makes it easier for the financial services industry to grow, resulting in a more diverse economy and longevity for future generations.

This story was first published by Turks and CAicos Weekly News