AML/ATF Ministerial Advisory 2/2022: Money Laundering and Terrorist Financing controls in higher risk jurisdictions (2022-07-12)

Summary

This Ministerial Advisory (issued by Bermuda's Minister of Legal Affairs and Constitutional Reform, published via the BMA AML/ATF page) draws the regulated sector's attention to the FATF's 17 June 2022 public statements identifying jurisdictions with strategic AML/CFT deficiencies. It reminds relevant persons of their existing obligation under Regulation 11(1)(aa) and (ab) of the Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing) Regulations 2008 to apply enhanced customer due diligence (EDD) on a risk-sensitive basis to business relationships involving higher-risk countries.

• Call for Action list (Annex A): North Korea (DPRK) and Iran are identified as high risk; firms must consider them as such and apply counter measures and enhanced due diligence in accordance with the risks, including additional measures required under the International Sanctions Regulations 2013 given they are also subject to sanctions.
• Increased Monitoring list (Annex B): Albania, Barbados, Burkina Faso, Cambodia, Cayman Islands, Gibraltar, Haiti, Jamaica, Jordan, Mali, Morocco, Myanmar, Nicaragua, Pakistan, Panama, Philippines, Senegal, South Sudan, Syria, Turkey, Uganda, United Arab Emirates and Yemen are listed; firms should take appropriate action to minimise associated risks, which may include EDD in high risk situations.
• Who must comply: All entities and persons subject to the POCA Regulations (Regulation 4): AML/ATF regulated financial institutions, independent professionals, casino operators, FIA-registered dealers in high value goods, and real estate brokers/agents.
• Superseding effect: This Advisory replaces all previous Ministerial advisories issued on this subject.
• Non-exhaustive list: The Advisory notes many jurisdictions have not yet been reviewed by FATF, so the listed jurisdictions are not an exhaustive list of higher-risk countries relevant persons should consider.

The Advisory does not itself set a specific compliance deadline; it directs firms to read the annexed FATF statements in full and factor the identified risks into their ongoing AML/CFT systems and controls, including customer risk assessments and enhanced due diligence procedures.

Key obligations

• Apply enhanced customer due diligence, and where appropriate counter-measures, to business relationships or transactions involving DPRK and Iran, consistent with Regulation 11(1)(aa) of the POCA Regulations.
• Apply appropriate risk-mitigation measures, which may include enhanced due diligence, to business relationships or transactions involving jurisdictions listed under FATF increased monitoring (Annex B), including Cayman Islands, UAE, Gibraltar and others named.
• Take additional measures under the International Sanctions Regulations 2013 for jurisdictions marked with an asterisk (DPRK, Iran, Myanmar, Nicaragua, South Sudan, Syria, Yemen) that are subject to sanctions measures.
• Read the full FATF statements in Annexes A and B before making risk determinations regarding these jurisdictions.
• Incorporate FATF assessments and associated risks into firms' AML/CFT systems and controls on an ongoing, risk-sensitive basis.

Applies to

AML/ATF regulated financial institutions, independent professionals, casino operators, dealers in high value goods registered with the FIA, real estate brokers and real estate agents