Most Read Contributor in Cayman Islands, September 2016
The Cayman Islands Bankers Association (CIBA) has informed the
Ministry of Financial Services that banks have adjusted their
practices in relation to securing US cash, in order to better
service the increased demand that has been caused by the money
services businesses' (MSBs) requirement that customers now use
US dollars for remittances.
CIBA President Mark McIntyre acknowledged that the banks'
adjustments, in relation to the MSBs' decision to only accept
US cash, caused some initial disruptions. 'However, now that
the banks have made adjustments to their practices, those
disruptions largely have been resolved', he said.
In addition, Mr McIntyre said that local banks are continuing as
usual to facilitate wire transfers for persons who are sending
Providing background, Councillor Roy McTaggart, who is acting as
the Temporary Minister for Financial Services, said the MSB issues
are not unique to Cayman. Instead, they stem from strategies
undertaken by financial institutions, which are intended to reduce
their perceived global banking risks in relation to money
laundering and terrorist financing.
'These strategies are having a domino effect on money
remittance services worldwide, regionally and locally,' he
said. 'CARICOM, for example, has raised this as a regional
concern, as has the Caribbean Association of Banks.
'As a consequence, based on the current situation, certain
banks in Cayman have withdrawn from providing banking services to
Mr McTaggart noted that discussions among MSBs, local banks, the
Cayman Islands Monetary Authority and the Ministry indicate that
more convenient, long-term arrangements are being considered in
relation to money services.
The Cayman Islands Monetary Authority (CIMA) will continue to
regulate both local banks and MSBs, in order to ensure adherence to
globally accepted standards, said the Authority's Managing
Director Cindy Scotland.
'CIMA is aware that global regulatory bodies, including the
World Bank, Financial Stability Board, and Financial Action Task
Force have issued statements supporting the need to continue
remittance services worldwide, and the need for global bodies to
provide a clear framework for their legitimate use', she
Mr McTaggart said that although the decisions are commercial,
Government will continue to assist and support local banks and the
MSBs, as they endeavour to develop sustainable solutions.
'Government is involved in this matter in order to ensure
that the people of the Cayman Islands have access to the services
they need, in order to continue financially supporting their
friends and families abroad', he said.
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On the 9 September 2016 the MFSA issued feedback to its consultation of the 1 April 2016 in relation to intra-group loans.
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