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Doubts cast over Jersey’s AML performance

By Dan Byrne

The government of Jersey has released a report questioning its own performance in monitoring and combatting financial crime.

Its first ever National Risk Assessment (NRA) report of money laundering – covering the years 2013-2018 – gave the island a score of 0.4/1 in quality of FIU intelligence gathering, and 0.5/1 for capacity of resources for FC investigation.

The scores highlight a potential vulnerability to financial crime on an island which, despite being easy to overlook geographically, ranks among the top 60 financial centres in the world in 2020.

One concern for the island is its lack of adequate training for FIU staff. Because of this, financial intelligence personnel have not had the relevant up-skilling to keep Jersey’s efforts at pace with international developments in AML practice, the report said.

In addition, the absence of sufficient legal expertise in examining individual cases of potential fraud was criticised. The ability to sort the cases which merit further investigation from the cases which don’t is key in ensuring that no resources are wasted, the report noted.  

Along with neighbouring Guernsey, Jersey forms part of the Channel Islands which each retain almost complete autonomy over domestic affairs, but whose defence and international relations are administered by the UK government.

The small jurisdictions function largely as independent states and are mostly free to pursue their own financial policy.

Concerns have been raised by British MPs in the past over the islands’ vulnerability to money-laundering, and the threat that it could pose to the financial integrity of the UK. Additionally, The Tax Justice Network have previously described the islands as ‘among the worst tax havens worldwide’.

Jersey Minister for External Relations Ian Gorst noted that “as an International Finance centre, Jersey is inevitably exposed to money laundering threats.”

He added that the report, “will determine the threats faced by Jersey on a national basis as well as threats which are specific to individual sectors of our finance industry.”

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