Money Laundering Officer Role and Responsibilities in the Cayman Islands

January 30, 2023

The Cayman Islands is a major financial center and as such, has a significant role in the global fight against money laundering. In this context, the role of anti-money laundering officers (AMLO’s) is crucial in ensuring that financial institutions and designated non-financial businesses and professions in the Cayman Islands comply with anti-money laundering (AML) and counter-terrorism financing and proliferation (CTF) regulations. Cayman specifically requires a named Anti Money Laundering Compliance Officer, a Money Laundering Reporting Officer, and a Deputy Money Laundering Reporting Officer.

AMLO’s are responsible for implementing and maintaining an effective AML/CTF program within their organization, which includes identifying, mitigating, and reporting money laundering and terrorism financing risks. They are also responsible to liaise with the board of directors and other service providers to ensure an effective line of communication for reporting any suspicious activity as well as the reporting of this suspicious activities to the Cayman Islands Financial Reporting Authority (FRA)

To be an effective AMLO, individuals should have a strong understanding of AML/CTF laws and regulations, as well as the ability to analyze and evaluate risk. They should also have excellent communication and interpersonal skills, as the role involves working with a wide range of stakeholders, including employees, regulatory authorities, and law enforcement agencies.

Some other specific responsibilities of an AMLO for a Cayman Islands entity include:

  • Ensuring that the organization has appropriate AML/CTF policies, procedures, and controls in place.
  • Collect and monitor risk assessments to identify and evaluate the money laundering and terrorism financing risks faced by the organization.
  • Ensure employees conducting AML checks attend training programs on AML/CTF regulations and the organization's internal policies and procedures.
  • Overseeing the suspicious activity reporting process and ensuring that all suspicious activity is properly reported to the FRA.
  • Providing guidance to employees on how to identify and report suspicious activity.
  • Reviewing and approving transactions and customer relationships that pose a high risk of money laundering or terrorism financing.
  • Maintaining records and documentation related to AML/CTF compliance, including customer due diligence and suspicious activity reports.
  • Liaising with regulatory authorities and law enforcement agencies as required.
  • Staying up to date with changes in AML/CTF laws and regulations and ensuring that the organization's policies and procedures are in line with these developments.

As a leading fund administrator, Formidium is well-equipped to fulfill the AMLO roles for fund managers looking to open up Cayman vehicles. With a team of highly skilled and experienced professionals, Formidium has the expertise and knowledge to ensure that your organization is in compliance with all relevant anti-money laundering (AML) and counter-terrorism financing (CTF) regulations.

Formidium's comprehensive range of fund administration services includes the implementation and maintenance of effective AML/CTF programs, risk assessments, employee training, and suspicious activity reporting. By entrusting your MLO responsibilities to Formidium, you can have peace of mind that your organization is meeting its regulatory obligations and reducing the risk of money laundering and terrorism financing.

In addition, Formidium's commitment to providing excellent customer service means that you can expect timely and accurate support from our team. We understand that compliance can be a complex and time-consuming process, which is why we strive to make it as straightforward and hassle-free as possible for our clients.

Overall, choosing Formidium as your AMLO partner will give you the confidence and assurance that your Cayman vehicle is in good hands, allowing you to focus on what matters most – growing your business.

Written by Chris Meader

Chris has over 20 years of experience in Fund Administration and Middle and Back Office Services. Currently working as EVP of Risk & Compliance. Chris has held senior roles with large bank-owned US administrators and medium-sized administrators in both Bermuda and the Cayman Islands.