Jersey: Law of Offshore
Money Laundering Legislation
Jersey's first major piece of money laundering legislation was the Money Laundering (Jersey) Order 1999. It has been amended several times since.
Jersey moved quickly after the September 11, 2001, terrorist attacks in the United States to implement new legislation to counter terrorist funding threats, including the implementation of a Terrorist Financing Order and the UN Convention for the Suppression of Terrorist Financing. This means that Jersey is able to try an individual for terrorist crimes, in particular for terrorist financing crimes, committed outside Jersey.
The Terrorist Financing Order came into force on October 10 and is virtually identical to the legislation introduced in the City of London in late September 2001. The Order enables Jersey to freeze any assets held by suspects named by the President of the United States in Executive Orders.
Important changes to the Island's money laundering regime were made in 2006:
- A risk-based approach to customer due diligence was set out, that permits reduced or simplified measures in the case of lower risk relationships, and requires enhanced customer due diligence in the case of higher risk relationships.
- Much more emphasis was placed on customer due diligence measures other than identification and verification of identity, and, in particular, on ongoing monitoring of unusual, complex, and higher risk activity and transactions.
- More customer friendly ways of verifying the identity of applicants for business or customers were introduced, including scope for greater reliance on a single document to verify identity in lower risk circumstances, for example, a passport.
- Measures to guard against the financial exclusion of Jersey residents were clarified. In particular, in the case of a lower risk minor, whose parent or guardian is unable to provide standard documentation to verify the minor’s identity, identity may be verified through use of the minor’s birth certificate.
- The responsibilities of senior management in preventing and detecting money laundering were emphasised as part of a section addressing corporate governance.
A number of amendments to the Proceeds of Crime (Jersey) Law 1999 were introduced in 2008 under the Proceeds of Crime (Amendment) (Jersey) Law 2008 in preparation for an IMF visit.
This law now provides the necessary legal framework to oversee those employed in any business or profession where money laundering or financing of terrorism could take place – including finance companies, lawyers, accountants and insolvency practitioners. Also included are other groups such as estate agents, casino operators and sellers of high value goods.