Press Release - 20 March 2003
JERSEY PLANS TO MONITOR BUREAUX DE CHANGE
Consultation process starts this week
The Jersey Financial Services Commission began consulting this week on proposals to ensure that all bureaux de change, money transmitters, and cheque-cashers (collectively referred to as money services businesses) have systems and controls in place to prevent money laundering.
The JFSC's consultation paper contains proposals which are relevant for businesses such as hotels and travel agents, which are not part of the financial sector but which provide money services business facilities. The options proposed aim to apply a lighter touch to ensure that such businesses also comply with existing anti-money laundering requirements.
Jersey legislation requires money services businesses to have systems and controls in place to prevent money laundering. Most bureaux de change and money transmission business is conducted by banks in Jersey and so their compliance with anti-money laundering defences is already fully monitored by the JFSC. However, there is no authority responsible for monitoring whether these systems and controls are implemented effectively in the handful of money services businesses that are not part of banking groups. This puts Jersey technically at variance with international standards.
The JFSC's consultation paper sets out four ways in which the Island's anti-money laundering framework might be amended to ensure that the Island complies with international standards. Each option anticipates some form of licensing or registration of activities and provides for oversight of the non-bank money services sector to ensure that it is following existing legal requirements.
Apart from the clearing banks, in Jersey the bureau de change market is represented by Jersey Post, and a handful of travel agents - while money transmission facilities are offered by both Moneygram and Western Union. In addition, many hotels offer a foreign exchange service as an ancillary service to their guests. Cheque cashing services are offered in Jersey by some retailers.
Other jurisdictions already monitor compliance by money services businesses with anti-money laundering obligations. In the United Kingdom, for example, money services businesses are required to register with HM Customs, which has powers to enter premises and inspect documents and records to ensure compliance with anti-money laundering requirements.
Taking powers to oversee money services will also allow the Jersey authorities to consider how money services businesses comply with legislation in place in Jersey to counter the financing of terrorism and whether further measures are needed.
The consultation paper on money services businesses is now available on the Commission's website.
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