Comply with new anti-money laundering regulations or face penalties - Trident Trust serves a timely reminder to Cayman Funds


Trident Trust, the independent corporate, fiduciary and fund administrator, is reminding Cayman Islands-domiciled funds – including private equity funds – that they could face fines of up to CI$500,000 and, in some cases, imprisonment for two years, if they fail to comply with updated anti-money laundering regulations, which were introduced in October 2017.

The new regulations apply to all Cayman investment funds without exception, with the AML exemptions previously available for investors of unregulated funds having been withdrawn. The final deadline by which previously exempt funds must comply is 30 September 2018.

The new rules increase the obligations placed on Cayman entities and also the sanctions for non-compliance. They require client identification and verification, record keeping, internal and external reporting, internal control and communication procedures and employee training. Funds must now also apply a risk-based approach, observe the list of countries which are non-compliant with FATF, adopt procedures to screen employees to ensure high standards when hiring, and designate staff into a number of senior positions including money laundering reporting officer and anti-money laundering compliance officer.

While the responsibility for ensuring compliance with the regulations rests with the investment entity, the law does allow the delegation of the AML functions provided the delegate is located in a country with equivalent legislation and the delegate itself is subject to the AML regime of that equivalent jurisdiction.

Trident Trust is encouraging firms in any doubt about the implications of the regulations to seek independent advice. For more information, visit here

Trident Trust, Cayman Islands, Anti-money laundering, Fiduciary, Fund administration, Regulation, Private Equity Funds

Cayman Funds