trust services

Who is caught

Trust business carried on from within the Cayman Islands is regulated by the Cayman Islands Monetary Authority (CIMA), principally under the Banks and Trust Companies Act (2025 Revision). Any company carrying on trust business must hold a licence, and CIMA's remit over trust companies is confirmed in the Monetary Authority Law (2020 Revision). A range of subsidiary regulations, rules, guidance and supervisory circulars extend to trust companies and to trust and corporate services providers (TCSPs) more broadly.

• Licensed trust companies: Companies carrying on trust business from within the Islands, holding a Trust licence, Restricted Trust licence or Nominee (Trust) licence under the Banks and Trust Companies Act.
• Private trust companies: Cayman-incorporated companies conducting only connected trust business for a defined group of connected persons, operating under the Private Trust Companies Regulations (2026 Revision).
• Controlled subsidiaries: Trust subsidiaries of licensees that rely on the section 5(3) exemption and register with CIMA rather than holding a full licence.
• Branches and applicants: Branches of foreign banks or trust companies and applicants for trust licences, addressed in the Licence Applications and Fees Regulations and the licence application procedure.
• Authorised agents: The two individuals or body corporate, resident or incorporated in the Islands and approved by CIMA, who act as a licensee's agent and principal point of contact with CIMA.
• Trust and corporate services providers: TCSPs subject to AML/CFT supervision and thematic inspection under the Anti-Money Laundering Regulations.

Trust companies are also caught by cross-sector CIMA instruments that apply to all regulated entities, including the Rule on Corporate Governance, the Rule and Statement of Guidance on Internal Controls, the outsourcing guidance, the succession planning guidance and the professional indemnity insurance guidance.

Sources: Banks and Trust Companies (Licence Applications and Fees) Regulations (2026 Revision) · Banks and Trust Companies Act (2025 Revision) · Monetary Authority Law (2020 Revision) · Private Trust Companies Regulations (2026 Revision) · Regulatory Procedure on Deregistration of Controlled Subsidiaries and Private Trust Companies · Statement of Guidance - Responsibilities of Authorised Agents of Banks and Trust Companies · Combined 2019 Sectoral Risk Ratings (2020-03-13) · Procedure for Licence Applications (2021-06-28) · Regulatory Policy - Criteria for Approving Changes in Ownership and Control · Regulatory Policy - Applications for the use of Restricted Words (February 2017) · Statement of Guidance: Outsourcing – Regulated Entities (April 2023) · Rule on Corporate Governance for Regulated Entities (April 2023) · Rule and Statement of Guidance – Internal Controls for Regulated Entities · Statement of Guidance - Succession Planning (March 2019) · Statement of Guidance - Professional Indemnity Insurance (August 2016)

Key duties

Licensing and registration

The primary duty is to be licensed or registered before carrying on trust business. Applications must be made in writing to CIMA with the prescribed information and non-refundable fee.

• Trust licence: No trust company may carry on trust business from within the Islands without a valid licence, subject to prescribed exemptions (s.5(2) of the Banks and Trust Companies Act).
• Application content: Applications must contain the information and particulars in the Schedule to the Licence Applications and Fees Regulations, with the prescribed application fee submitted at the outset before processing time begins.
• PTC registration: A private trust company must register with CIMA to obtain and maintain its licensing exemption, keep its registered office at a licensed trust company, and appoint at least one natural person director.
• Principal office and agent: A licensed trust company must maintain an approved principal office and an approved resident agent in the Islands, and obtain CIMA's prior approval before ceasing or changing either.

Annual filings and fees

• Annual licence fee: Every licence holder must pay the prescribed annual fee to the Financial Secretary on or before 15 January each year following first grant; amounts vary by licence type, restrictions and, for certain licences held by branches or subsidiaries of foreign banks, average total assets across the four calendar quarters.
• Controlled subsidiary declaration: A controlled subsidiary must file an annual declaration on or before 31 January each year naming the subsidiary, its parent licensee, its directors and senior officers, and confirming its status, and pay a further fee of $8,000.
• PTC fees: A PTC must pay an initial registration fee of US$3,500 and an annual registration fee of US$4,000; late payment incurs a surcharge of up to one-twelfth of the annual fee per month or part-month overdue.
• PTC annual declaration: A PTC must file an annual declaration in the CIMA-approved form on or before 31 January each year, with proof of identification of directors and shareholders.

Records and governance

• PTC records: A PTC must keep at its registered office, available for CIMA inspection, up-to-date records including trust deeds, details of trustees, settlors, protectors, enforcers, contributors and beneficiaries, and financial and transactional records.
• Corporate governance: Under the Rule on Corporate Governance, the governing body must establish and maintain a documented governance framework, hold at least annual meetings with detailed minutes, and conduct at least annual reviews of strategy, composition, risk management and controls.
• Internal controls and client money: Under the Internal Controls Rule, trust companies must segregate client assets and client money, disclose in writing how client money is held, reconcile client money accounts promptly, and require at least dual signatories for client money pay-outs.
• Professional indemnity insurance: CIMA's guidance expects trust companies to maintain adequate PI insurance (or approved alternative), generally at least $1,000,000 per claim and $1,500,000 in aggregate, and to confirm cover to CIMA annually.
• Succession planning: Licensees are expected to maintain a documented succession plan, kept in English and available to CIMA on request.

Notifications and approvals

• Change of control: Shares of a regulated entity cannot be transferred, issued or disposed of without CIMA's prior approval; acquiring 10% or more (or control) triggers a Personal Questionnaire, and the entity must notify CIMA immediately of material information affecting a controller's suitability.
• Material issues: Under the corporate governance rule, regulated entities must notify the regulator by email within ten days of any substantive issue that could materially affect the entity, and comply promptly with information requests.
• PTC changes: A PTC must notify CIMA within 30 days of any change to its registration information.
• Outsourcing: For material functions, entities must notify CIMA in writing within a reasonable timeframe of new or terminated outsourcing agreements and maintain a centralised log; regulated PTCs are excluded from the outsourcing guidance.

AML/CFT obligations

Trust companies and TCSPs conducting relevant financial business must operate an AML/CFT framework consistent with the Anti-Money Laundering Regulations and CIMA's Guidance Notes, including risk assessment, customer due diligence, enhanced measures for politically exposed persons, appointment of a Money Laundering Reporting Officer, record-keeping and ongoing monitoring. CIMA's thematic reviews of TCSPs reiterate obligations to verify identity and beneficial owners and to screen clients and associated parties against targeted financial sanctions lists at onboarding and on an ongoing basis.

Sources: Banks and Trust Companies (Licence Applications and Fees) Regulations (2026 Revision) · Banks and Trust Companies Act (2025 Revision) · Private Trust Companies Regulations (2026 Revision) · Regulatory Procedure on Deregistration of Controlled Subsidiaries and Private Trust Companies · Statement of Guidance - Responsibilities of Authorised Agents of Banks and Trust Companies · 2022 Review of TCSPs Compliance with AMLRs – Sanctions Screening Policies and Procedures (2023-07-27) · 2021 Review of TCSPs Compliance with AMLRs - Sanctions Screening Policies and Procedures (2022-06-17) · 2021 Review of TCSPs Compliance with AMLRs - Customer Verification and Identity (2022-01-19) · Procedure for Licence Applications (2021-06-28) · Regulatory Policy - Criteria for Approving Changes in Ownership and Control · Statement of Guidance: Outsourcing – Regulated Entities (April 2023) · Rule on Corporate Governance for Regulated Entities (April 2023) · Rule and Statement of Guidance – Internal Controls for Regulated Entities · Statement of Guidance - Succession Planning (March 2019) · Statement of Guidance - Professional Indemnity Insurance (August 2016) · Guidance Notes on the Prevention and Detection of Money Laundering, Terrorist Financing and Proliferation Financing in the Cayman Islands (2020 Revision)

Exemptions and carve-outs

The instruments provide several carve-outs from full trust licensing and from certain approval and fee requirements.

• Controlled subsidiary exemption: A controlled subsidiary of a licensee may rely on the section 5(3) exemption from holding its own licence, provided it registers with CIMA and files the required annual declaration.
• Private trust company exemption: A Cayman-incorporated company conducting only connected trust business may operate without a full trust licence if it registers as a PTC and meets the ongoing conditions, including not soliciting or receiving contributions from the public or non-connected persons.
• Outsourcing guidance exclusion: CIMA's Outsourcing Statement of Guidance expressly excludes Private Trust Companies (as well as regulated mutual funds and private funds) from its scope.
• Stock exchange listing: FSPs whose shares are listed on an approved stock exchange may be exempt from prior approval for share transfers, but must notify CIMA when relying on the exemption; approval is still required where a resulting change of control is not covered.
• Cayman Brac and Little Cayman: The Governor may waive or reduce fees for licensees based in Cayman Brac or Little Cayman under the Licence Applications and Fees Regulations.
• Branch AML information: Branch applicants from countries designated as having equivalent AML/CFT measures may submit alternative information in place of that required under paragraph 10 of the Schedule, if CIMA is satisfied.

Sources: Banks and Trust Companies (Licence Applications and Fees) Regulations (2026 Revision) · Banks and Trust Companies Act (2025 Revision) · Private Trust Companies Regulations (2026 Revision) · Regulatory Policy - Criteria for Approving Changes in Ownership and Control · Statement of Guidance: Outsourcing – Regulated Entities (April 2023)

Enforcement and penalties

Enforcement runs through the Banks and Trust Companies Act, the Monetary Authority Law and CIMA's administrative fines regime, alongside CIMA's broader supervisory and enforcement powers.

• Statutory offences: The Banks and Trust Companies Act creates offences for contravention, including carrying on unlicensed banking or trust business and providing false or misleading information, and gives CIMA supervisory, investigatory and enforcement powers including applying to the Grand Court and requiring public disclosures.
• Administrative fines: Under Part VIA of the Monetary Authority Law and the Monetary Authority (Administrative Fines) Regulations, CIMA may impose fines for breach of a prescribed provision, classified as minor, serious or very serious, following a breach notice, reply and (for discretionary fines) prescribed criteria.
• Fine process rights: A party receiving a breach notice for a fixed fine may rectify within 30 days; fixed fines may be reviewed by CIMA's Management Committee, and discretionary fines may be appealed to the Grand Court. An unpaid fine is a debt to the Crown and carries interest.
• Indicative fine amounts: A 2017 CIMA circular describing the incoming regime stated non-discretionary minor breaches attract $5,000 per breach (up to $20,000 if ongoing) and discretionary serious or very serious breaches attract $50,000 to $1,000,000 per breach.
• AML/sanctions enforcement: CIMA has warned that breaches of the AML Regulations or non-compliance with a Statement of Guidance may lead to enforcement action including administrative fines, and that failure to comply with targeted financial sanctions obligations is a separate criminal offence enforced by the Governor through the Financial Reporting Authority, which can also levy civil monetary penalties.
• Supervisory actions: CIMA reports having taken enforcement actions including licence revocations, a controllership, a winding-up petition, fines and warning notices, and issues remediation requirements following inspections, with no tolerance for repeat deficiencies.

Sources: Banks and Trust Companies Act (2025 Revision) · Monetary Authority (Administrative Fines) Regulations (2025 Revision) · Monetary Authority Law (2020 Revision) · 2022 Review of TCSPs Compliance with AMLRs – Sanctions Screening Policies and Procedures (2023-07-27) · 2021 Review of TCSPs Compliance with AMLRs - Sanctions Screening Policies and Procedures (2022-06-17) · 2021 Review of TCSPs Compliance with AMLRs - Customer Verification and Identity (2022-01-19) · AML/CFT & Sanctions Onsite Inspections & Findings Pt 2 (2020-05-29) · TCSPs Onsite Inspections Findings & Administrative Fine Regime (2017-02-01)