The Cayman Islands Monetary Authority (CIMA) recently issued clarification of its Guidance Notes in respect of the Anti-Money Laundering Regulations to make it clear that all funds (whether regulated by CIMA or not) conducting "relevant financial business" in or from within the Cayman Islands are required to appoint individuals to act as Anti-Money Laundering Compliance Officer (AMLCO), Money Laundering Reporting Officer (MLRO) and Deputy Money Laundering Reporting Officer (DMLRO, together with the AMLCO and MLRO, AML Officers). CIMA also expects each fund to disclose in its offering document the fact that the fund has designated AML Officers and details as to how investors may obtain further information in respect of these officers.
In short, the AMLCO oversees the fund's AML procedures and compliance, including monitoring and receiving periodic reports from service providers (e.g. the administrator and the investment manager) to whom AML functions may have been delegated, and is the point of contact with the supervisory and other competent authorities. The MLRO acts as the point of contact for receiving all suspicious activity reports within the fund's organisation. The DMLRO discharges the MLRO's functions in that officer's absence.
The deadline for the appointment of AML Officers for all existing funds within scope of the Anti-Money Laundering Regulations is 30 September 2018. Please note that the same individual can act as the AMLCO and also as either MLRO or DMLRO; that the MLRO and the DMLRO must be two separate individuals; and that the functions of AML Officers may be delegated to the fund's service providers. Examples of individuals who can be appointed as AML Officers include directors of the fund, employees of the investment manager, employees of the administrator or employees of any other service provider. Each fund should ensure that its AML Officers have adequate and appropriate knowledge and expertise to perform their respective functions.
The specific next steps applicable to you will depend on a number of factors regarding your business, its structure, the AML regime being applied (if not the Cayman Islands AML regime) and your role within the industry. Please speak to Sailaja Alla in Cayman or your usual Appleby contact to understand fully any expanded obligations, document updates or new contractual agreements that may be required.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.