Why Curaçao organisations must prioritise compliance

With the regulator taking a tougher stance on know your customer (KYC) and anti-money-laundering (AML) rules, Curaçao’s finance businesses need to fine-tune their compliance processes

Curaçao’s central bank is becoming stricter on organisations failing to implement adequate compliance procedures.

Regulators are conducting more frequent and thorough checks to ensure sufficient know your customer (KYC) and anti-money-laundering (AML) processes are in place, and to assess corporate governance generally.

Banks, lenders and investment houses – alongside connected notaries, lawyers and accountants – are at the sharp end of these efforts, which are adding significantly to their administrative burden.

But the sweep extends beyond financial services. The regulator is increasingly interested in any business that handles large amounts of cash, from construction material merchants to real estate agents.

Curaçao has a reputation for compliance

The central bank is demanding more transparency to protect Curaçao’s reputation for compliance.

The island is on the Organisation for Economic Cooperation and Development (OECD) white list of countries that are not considered tax havens – and it is determined to preserve this status.

It is also determined to enhance its reputation as a jurisdiction that is serious about the elimination of money laundering and the financing of terrorism.

While relevant compliance laws have been on the statute book for some time, many organisations have taken the view that they could get away with the bare minimum in terms of corporate oversight, AML and KYC. The recent upswing in activity suggests this is no longer the case.

The increase in checks can also be seen in an international light. Around the world, regulators are demanding more in terms of transparency.

Curaçao is a stable and compliant jurisdiction for investors, a fiduciary service provider and financial services provider.

What does the focus on compliance mean for Curaçao businesses?

While the focus on compliance is welcome, it does place an extra administrative burden on financial services providers.

Data gathering and reporting for compliance purposes can be complex and time-consuming. The remediation of files requires painstaking attention to detail. Regulatory changes must be tracked, interpreted and implemented.

In-house personnel may lack the depth of knowledge required for such tasks. Besides, they would generally rather get on with their core roles.

Organisations in other sectors are likely to get caught up in the sweep of anti-money-laundering efforts. Real-estate agents and firms linked to the construction industry should be prepared for greater scrutiny.

How can Curaçao organisations prepare?

Organisations that might be affected are asking how they can prepare their processes to meet increased regulator demands.

For a start, banks, investment firms and other financial businesses need to set up compliance frameworks that can be used again and again.

They need procedures in place for monitoring and reporting AML and KYC efforts and measuring activity against agreed KPIs. They need to make sure that the remediation of files is always accurate and timely.

All organisations serving the financial services industry – including accountants and lawyers – need to train staff in the relevant legislation and its practical implementation.

This is a major undertaking, and outsourcing to a third-party provider such as Intertrust Group can save businesses a major administrative headache.

We can provide personnel to make remediation processes more efficient and help set up monitoring and reporting systems. We can train your staff to be aware of compliance responsibilities, in adherence to local regulations.

It’s also true that, for businesses in all sectors, the presence of an independent third party can help reassure banks and regulators that relevant checks are in place.

We can quickly pre-screen construction or real-estate customers to confirm that their business interests are legitimate.

Curaçao is entering a new era of compliance and organisations that fail to comply risk serious financial and reputational damage. Outsourcing compliance processes can help keep your business in good regulatory standing.

Why Intertrust Group?

• Intertrust Group is well established in Curaçao and can guide clients through the entire process of creating and maintaining effective corporate governance, AML and KYC processes.
• We can take care of all fiduciary and compliance matters.
• As a strategic partner, our use of innovative technologies is combined with global knowledge and experience to deliver a wide range of added-value services.
• Intertrust Group is a publicly listed company with 70 years’ experience in providing world-class trust and corporate services to clients around the world.