The presence on this list, while it certainly doesn't halt financial business, can be a dampener and jurisdictions freed from it can broadcast their compliance credentials more easily.

A Paris-headquartered intergovernmental group focused on fighting money laundering and counter-terrorism finance has removed the Cayman Islands and Panama from its “gray list” of jurisdictions subject to increased monitoring.

Last week the Financial Action Task Force, aka FATF said it welcomed moves by the Cayman Islands and Panama in making progress to improve their AML and CFT regimes. The jurisdictions hailed the result.

Countries that remain on the “increased monitoring” list are Barbados, Bulgaria, Burkina Faso, Cameroon, Democratic Republic of the Congo, Croatia, Gibraltar, Haiti, Jamaica, Mali, Mozambique, Nigeria, the Philippines, Senegal, South Africa, South Sudan, Syria, Tanzania, Turkey, Uganda, the United Arab Emirates, Vietnam, and Yemen. 

Besides the Cayman Islands and Panama, the group has removed Albania and Jordan from the list.

Financial services minister André Ebanks, Cayman Islands, this week welcomed the FATF decision. 

“We had a shared determination to step out from under this shadow as soon as possible, and today we have done exactly that…Compliance with the FATF standard helps protect all of us as we conduct everyday business, whether that’s banking, purchasing local goods, or donating to charities.” (Source: CNG Media October 30.)

Panama's Minister of Foreign Affairs, Janaina Tewaney, late last week praised the FATF action, according to a statement: “After being added to the Financial Action Task Force (FATF) gray list in June 2019, our administration took office in July of the same year with a firm commitment to fostering a more robust framework to fight money laundering and terrorist financing, and nurture a more transparent financial system.”

“Since then, Panama has successfully implemented several strategic measures aimed at consolidating our legislative and regulatory framework to reinforce the fight against money laundering and enhance the transparency of our financial system according to international standards,” Tewaney said.

This news service has contacted the Gibraltar and UAE government for comment, and may update this article in due course.

Completion
The FATF said it urged jurisdictions to “complete their action plans expeditiously and within the agreed timeframes.”

“The FATF does not call for the application of enhanced due diligence measures to be applied to these jurisdictions. The FATF standards do not envisage de-risking, or cutting-off entire classes of customers, but call for the application of a risk-based approach,” it said.

“The Cayman Islands’ removal from FATF’s gray list is great news for the jurisdiction – basically, the first hurdle has been cleared, and is a signal that sanctions and penalties are effective and proportionate – a vital means of demonstrating our credentials as an international finance centre,” Kareem Robinson, head of capital markets, Ocorian, in the Cayman Islands, said in a note yesterday about the change.

“The Cayman Islands has long specialized in collateralized loan obligations. Following the gray listing, which prompted the Cayman Islands being added to the EU AML blacklist, managers who were seeking EU investors to their transaction using Cayman Islands securitization SPVs were impacted. The listing triggered a move to other jurisdictions like Bermuda and Jersey,” Robinson said. “With the gray listing lifted, we’re anticipating a return to the Cayman Islands of CLO work from European managers when the Cayman Islands are removed from the EU AML blacklist in early 2024, which should happen by default following the removal of the Cayman Islands from the FATF gray list.”