Isle of Man updates AML and CFT framework for FATF 'consistency'

The Isle of Man Financial Services Authority, in conjunction with the Department of Home Affairs and Treasury, has led a revision of the Proceeds of Crime Act 2008 (POCA) and the Designated Business (Registration and Oversight) Act 2015 (DBROA).

Those amendments took effect from Friday 25 October 2024, while the new Travel Rule (Transfer of Virtual Assets) Code 2024 came into operation from Monday 28 October 2024.

The intention was to achieve consistency across the Island’s AML/CFT legislation and ensure greater alignment with international standards and the definitions and terminology set by the Financial Action Task Force (FATF), the organisation that leads global action to counter money laundering, terrorist financing and proliferation financing, the regulator said in a statement on 25 October.

Further information will be published to explain the changes, with new guidance being produced to raise awareness of the obligations and expectations of the Travel Rule Code among firms in the Virtual Asset Service Provider (VASP) sector. This includes compliance with the requirement to transfer and retain certain customer information when conducting virtual asset transactions.

The legislative updates reflect feedback to two public consultations issued earlier this year and are being made through:

The Proceeds of Crime (Business in the Regulated Sector) (Amendment) Order 2024, which amends Schedule 4 to the POCA.
The Designated Businesses (Amendment) Order 2024, which amends Schedule 1 to the DBROA.

Ashley Whyte, Head of AML/CFT Supervision at the Authority, said: "We have worked in collaboration with the Department of Home Affairs and Treasury to modernise the Island’s AML/CFT framework and introduce the Travel Rule Code.

"Firms are encouraged to take note of the changes, which are aimed at keeping the Island in line with globally recognised standards. Guidance documents will be published shortly on the Authority’s website to provide additional support and clarity.’

The Authority will also be publishing a recorded webinar to provide an overview of the Travel Rule (Transfer of Virtual Assets) Code 2024, how it aligns with international standards and what it means for the VASP sector in the Island.