CIMA Logo
AMLCFT banner
Home > AML and CFT > Countering the Financing of Terrorism

In This Section


Combatting the Financing of Terrorism and Proliferation Financing

 

       This page covers:

 

The Criminalization of Terrorist Financing in the Cayman Islands 

The Terrorism Law is the principal enactment in relation to the criminalization of terrorist financing in the Cayman Islands. The Terrorism Law is a domestic legislation criminalizing terrorism and terrorist financing, the latter in accordance with the UN Convention on the Suppression of Financing of Terrorism.

Section 19 makes it an offence to solicit, receive or provide property intending that it be used, or having reasonable cause to suspect that it may be used, for the purposes of terrorism. Section 2 defines property as including money and all other property, real or personal, including things in action and other intangible property. Section 18 defines 'terrorist property' as property which is “proceeds of, or used in, or intended or allocated for use in” the financing of acts of terrorism, terrorists or terrorist organizations.

Section 20 makes it an offence for a person to use property for the purposes of terrorism or to possess property intending that it be used, or having reasonable cause to suspect that it may be used, for the purposes of terrorism.

Section 21 makes it an offence for a person to enter into or become concerned with an arrangement as a result of which property is made available to another knowing or having reasonable cause to suspect that it will or may be used for the purposes of terrorism.

Section 22 makes it an offence to enter into or become concerned with an arrangement which facilities the retention or control by or on behalf of another person of terrorist property by concealment, by removal from the jurisdiction or by transfer to nominees.

Section 23 requires financial services providers to disclose to the Financial Reporting Authority if they suspect or believe that an offence under sections 19 to 22 of the Terrorism Law has been committed.
In addition, the Governor may designate a person because of involvement in terrorist activities being carried on by that person. Such designation will be published in the Gazette. Financial Services Providers must freeze without delay funds or economic resources held or controlled by a designated person and must inform the Governor. The Governor may issue a license to permit a Financial Services Provider to deal with funds and economic resources of a designated person.
 

 The Criminalization of Proliferation Financing

Proliferation Financing refers to the act of providing funds or financial services which are used, in whole or in part, for the manufacture, acquisition, possession, development, export, trans-shipment, brokering, transport, transfer, stockpiling or use of nuclear, chemical, or biological weapons and their means of delivery and related materials (including both technologies and dual use goods used for illegitimate purposes), in contravention of national laws or, where applicable, international obligations.

 The United Nations Security Council may designate individuals or entities involved in the proliferation of weapons of mass destruction and its financing. As of this date, the United Nations has passed two resolutions relating to anti-proliferation, one related to North Korea and the other related to Iran. These resolutions are in force in the Cayman Islands via orders passed in the United Kingdom, namely The Iran (Sanctions) (Overseas Territories) Order 2016 and the Democratic People’s Republic of Korea (Sanctions) (Overseas Territories) (Amendment) Order 2017.

The Proliferation Financing (Prohibition) Law (2017 Revision) and the Proliferation Financing (Prohibition) Amendment Law require financial services providers that have in their possession, custody or control any funds or economic resources controlled by persons designated in the above noted orders to:

  1. Immediately freeze the funds 
  2. Disclose the matter to the Financial Reporting Authority.

Anti-Proliferation Financing Orders

In addition to the two sanctions orders mentioned above, pursuant to the Proliferation Financing (Prohibition) Law, the Financial Reporting Authority may give a direction to a person or class of persons within the financial services sector in relation to terrorist financing, money laundering or the development of weapons of mass destruction. Via these directions the Authority has the power to impose requirements relating to customer due diligence measures, ongoing monitoring practices, systematic reporting and cessation of business. Failure to comply with a direction constitutes an offence.

Obtaining a licence or authorization under The Proliferation Financing (Prohibition) Law 

  • A relevant person may apply in writing for a licence allowing for an exemption from the requirements of a direction that restricts or ceases business.
  • The applicant shall provide such information and documents as may be required in determining the application (to be determined on a case by case basis). 

Further details can be obtained from the Financial Reporting Authority

 

 
Rating:
Comments:
  
If you have any specific questions please click Email Us.

Quicklinks

Active CIMA websites

Security threats advisories

Complaints Procedure

 

Print This Article

E-mail This Page

Contact Us

Click here to Email the Policy & Development Division 

Phone: 345-244-1655; 345-949-7089
Fax: 345-946-5611

Address:
Cayman Islands Monetary Authority
PO Box 10052
80 Shedden Road
Elizabethan Square
Grand Cayman  KY1-1001
CAYMAN ISLANDS