Jersey grows wary of the CaymanIslands and Malta
By Charlotte Denny, TheGuardian
Jersey yesterday warned local banks to bewary of doing business with companies from the Cayman Islandsand Malta because of concerns about money laundering.
Underlining a determination to clean up its financial servicesindustry, the Jersey financial services commission advised localfirms that neither country's financial crime regulations wereup to international standards and that they should check any businesswas legitimate before accepting it.
Jersey has been under investigation by the Financial Action Taskforce(FATF) combating white-collar crime, but in June escaped beinglisted among countries not complying with international effortsto stamp out money laundering.
This latest move marks an attempt to distance itself from countriesstill not cooperating with the FATF's work.
"Jersey is determined to protect itself from money laundering,"said Richard Pratt, director general of the commission. "Thisdetermination has kept us off the FAFT's non-cooperating jurisdictionlist."
The UK regulatory authorities already issued a similar warningto both countries. The Caymans were on the FATF's list of 15 countriesnot cooperating in the fight against money laundering, while Maltawas one of the countries being investigated.
"The international regulatory and law enforcement agenciesremain interested in what Jersey does," said Mr Pratt. "Tomaintain our reputation and keep off the FATF's non-cooperativelist, we must and will press on with our reform agenda."
Jersey officials feared that inclusion on the list would haveproved damaging the island's economy.
Banks are increasingly wary about operating in jurisdictions whichare thought to be soft on money laundering. The American authoritieshave warned their financial services industry to take care intheir dealings with all the countries named by the FATF.
But some of the countries included on the list complain that theywere not properly consulted by the FATF ahead of publication.
The Caymans and the Bahamas both expressed disappointment at stillbeing "named and shamed" after their discussions withthe Financial Action Taskforce.