The MONEYVAL report on Jersey was published on 24 May 2016 giving Jersey a very positive rating.
What is the MONEYVAL report?
MONEYVAL is the Council of Europe's Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism.
It undertook a comprehensive evaluation of certain aspects of the Jersey's institutional, legislative and regulatory framework to deter money laundering and the financing of terrorism through financial institutions.
MONEYVAL began its assessment of Jersey in January 2015 and culminated in publishing a 300-page report on 24 May.
MONEYVAL gave Jersey a very positive rating.
It describes Jersey as having a:
"mature and sophisticated regime for tackling money laundering and the financing of terrorism".
Of the 49 assessment areas, Jersey was rated compliant or largely compliant in 48.
This is an excellent rating. It is the highest score amongst all states assessed in the MONEYVAL fourth evaluation cycle.
Why is this significant?
For Jersey to offer its services as a leading international finance centre to the wider world and particularly to expanding markets such as the Middle East and Asia, it's critical for Jersey to have a strong anti-money laundering and terrorist financing regime. These qualities are the cornerstone of our professional services offering.
MONEYVAL's thorough and in-depth report ranks us at the very top of the global table and confirms that the Island is consistently strong in this area.
This demonstrates that Jersey is the leading jurisdiction regarding transparency and countering financial crime.
The report endorses and highlights Jersey's ability to combat financial crime through a sophisticated system of capturing ownership information about entities and structures in the jurisdiction.
Jersey's beneficial ownership model puts it at the forefront of the transparency agenda.
This also reflects that the wider frameworks and supervisory systems in place in Jersey set it apart from most other jurisdictions.
"Jersey's combination of a central register of the UBO with a high level of vetting/evaluation not found elsewhere and regulation of TCSPs of a standard found in few other jurisdictions has been widely recognised by international organisations and individual jurisdictions as placing Jersey in a leading position in meeting standard of beneficial ownership transparency."
"The World Bank in their 2011 Report under the Stolen Assets Recovery Initiative (StAR) entitled "The Puppet Masters – How the Corrupt Use Legal Structures to Hide Stolen Assets and What to Do About It" recognised at chapter 4.1 that the "The Jersey Model" should be upheld as an example of how access to beneficial ownership and control information can be implemented in a jurisdiction."
Jersey's Chief Minister made clear at the recent anti-corruption summit in London that Jersey is committed to being at the forefront of the worldwide fight against financial crime.
How has Jersey achieved this?
Together Jersey's government, financial regulator and industry members have followed a purposeful strategy of transparency, innovation and quality for a number of decades.
They have been quick at developing policies and practices to advance Jersey's transparency such as its world-class beneficial ownership model, proactive in enhancing the jurisdiction's product offerings, and have focussed on the quality of services, by attracting a large professional workforce that is expert and skilled.
In a rapidly shifting global landscape, there is no room for complacency. Jersey is at the cutting edge in terms of combating financial crime and intends to maintain that leading position.
Partially compliant rating
The report rated Jersey partially compliant in the area of Reliance (assessment area 9).
This resulted from the accumulation of a number of effectiveness concerns relating to the Jersey regime, whereby, in certain circumstances, the private sector may rely on customer due diligence previously undertaken by equivalently regulated third parties such as banks.
MONEYVAL made one main recommendation.
This regarded the relatively low number of money laundering prosecutions, convictions and confiscations given the size and characteristics of the island's financial sector.
The Island has taken on board the report's recommendations and has committed to make improvements where there is an opportunity to do so in order to build on its reputation as a responsible, world-class centre for international finance.
In particular, the Government has committed to increasing the number of court cases resulting in convictions and confiscations. To support this it will inject further resource into financial crime investigation and prosecution and increase capacity to investigate and prosecute serious financial crime matters considered.
Since the report was undertaken in January 2015, one prosecution has taken place and in 2016 to date there have been an additional four prosecutions.
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.