An assessment of the risk of Jersey being used as a conduit for the funding of terrorist activity has been published today (Tuesday 20 April).
‘Bailiwick of Jersey: National Risk Assessment of Terrorist Financing’ concludes that the risk of either financial services or non-profit organisations being used to fund terrorism is medium-low. The report also confirms that, while Jersey has largely adequate systems and controls in place to mitigate the risks, there are areas where additional action is required to test and strengthen existing controls.
The report has been produced in response to requirements by the Financial Action Task Force (FATF), the international standard-setter on financial crime.
The Minister for External Relations and Financial Services, Senator Ian Gorst, said: “Understanding terrorist financing risk is a particularly complex challenge for all international finance centres due to the lack of common indicators to detect its occurrence. This is Jersey’s first report into terrorist financing and, as such, sets the baseline for mitigating the risks Jersey faces of being misused by criminals.
“Over the next 18 months, work will be done to determine if the medium-low rating could be lower, and Jersey’s finance industry is likely to be asked to provide additional data to that end. By its nature, however, terrorist financing is constantly evolving, and we must continue to be on our guard and prepared to take action to assess and mitigate against those risks.”
The report recommends that Jersey’s public and private sectors should both develop a more robust skills base to identify, investigate and supervise compliance with terrorist financing requirements.
“Preventing terrorists’ access to funds is seen as a crucial mechanism in the global fight against extremist atrocities, and combatting terrorist financing has been prioritised by the G20, the FATF, and other organisations such as the International Monetary Fund, and the World Bank. As an international finance centre, we are committed to combatting financial crime and upholding international standards, and it is essential that Jersey is able to demonstrate that we are meeting the FATF standards.”
The report was produced by the National Risk Assessment (NRA) Working Group, which included officers from the Government of Jersey, Jersey Financial Services Commission, Law Officers’ Department, States of Jersey Police, Jersey Overseas Aid, Jersey Customs & Immigration Service, and the Office of the Jersey Charity Commissioner. It was compiled using a methodology produced by the World Bank, enhanced by documents produced by the FATF as well as work conducted between Jersey and other IFCs.
The report forms part of an ongoing programme of financial crime risk assessment work and follows the publication of Jersey’s first national risk assessment of money laundering in September 2020.