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Anti-Terrorism and Anti-Terrorist Financing in the Cayman Islands

The Cayman Islands fully supports the fight against terrorism. In addition to the robust conventional anti-money laundering provisions directed at the proceeds of crime, the Cayman Islands is committed to doing its utmost to assist global efforts to secure the prevention and suppression of terrorism and terrorist financing. Current measures in force in the Cayman Islands are as follows:

The Iraq (United Nations Sanctions) (Overseas Territories) Order 20001

[SI 2000/3242 of 14 December 2000, as amended most recently by SI 2003/1516]. This Order was made pursuant to UN Security Council Resolution (UNSCR) 661 of 6 August 1990, and does the following –

  1. Crimnalises the making of funds available to the government of the Republic of Iraq or persons resident in Iraq, and the remission or removal of funds to Iraq from the United Kingdom;
  2. Provides for the Governor to require certain suspected Iraqi funds to be frozen;
  3. Prescribes offences and related penalties and proceedings; and
  4. Provides for the obtaining of information for the purposes of enforcement.

The Terrorism (United Nations Measures) (Overseas Territories) Order 2001

[SI 2001/3366 of 10 October 2001]. This Order was made pursuant to UNSCR 1373 of 28 September 2001, and does the following –

  1. Criminalises fundraising for terrorism purposes;
  2. Criminalises making funds and financial services available to terrorists;
  3. Makes it an offence for a relevant institution not to disclosure to the authorities customers who are known or suspected terrorists; and
  4. Gives powers to freeze accounts of known or suspected terrorists.

The Iraq (United Nations Sanctions) (Overseas Territories) Order 2003

[SI 2003/1516 of 14 June 2003].2 This Order was made pursuant to UNSCR 1483 of 22 May 2003 and does the following –

  1. Continues the prohibition of the sale or supply of arms and related materiel to Iraq;
  2. Criminalises holding or dealing in any item of illegally removed Iraqi cultural property;
  3. Grants privileges and immunities to the Development Fund for Iraq and petroleum, petroleum products and natural gas originating in Iraq and proceeds and obligations arising there from; and
  4. Amends SI 2000/3242.

Other relevant Orders in Council are as follows:

The Aviation Security and Piracy (Overseas Territories) Order 2000

[SI 2000/3059 of 6 December 2000], which extends certain provisions of the UK Aviation Security Act 1982 (as amended) and of the Aviation and Maritime Security Act 1990 (with adaptations and modifications) to all the Overseas Territories. The Order covers hijacking, destroying, damaging or endangering safety of aircraft, dangerous articles, air piracy, and protection of aircraft, aerodromes and air navigation installations from acts of violence.

The Afghanistan (United Nations Sanctions) (Overseas Territories) Order 2001

[SI 2001/392 of 16 February 2001] (as amended by SI 2001/2558 of 20 July 2001). This order-

  1. Imposes restrictions pursuant to UNSCR 1333 of 19 December 2000 on the delivery or supply of arms and related material, the provision of technical assistance and training and the supply of acetic anhydride to Afghanistan;
  2. Restricts the use of the Overseas Territories for flights destined to or originating from Afghanistan;
  3. Criminalises making funds available to Osama bin Laden and his associates;
  4. Criminalises the establishment or maintenance of Taliban offices or the carrying on of any business by Ariana Afghan Airlines;
  5. Imposes restrictions pursuant to UN Security Council Resolution 1267 of 15 October 1999 by prohibiting any aircraft from taking off or landing in the Overseas Territories if it is owned, leased or operated by or on behalf of the Taliban or any undertaking owned or controlled by them; and
  6. Freezes assets of the Taliban or any undertaking owned or controlled by them.

Orders pursuant to the relevant UN sanctions are also in force in respect of Iraq [SI 2000/3242] and Liberia [SI 2001/946 and SI 2001/1867(import of rough diamonds)].

In addition –

The executive orders from the President of the United States specifying suspected terrorists and lists from the UN Security Council and other credible sources are circulated to the industry by the Cayman Islands Monetary Authority immediately they are available, so that client lists can be checked and any necessary follow-up action taken. The industry, the Authority and other agencies have responded quickly and thoroughly in such circumstances and will continue to do so.

The Legislature of the Cayman Islands passed in July 2003 comprehensive legislation to deal with terrorism and its financing. It fully implements UN Security Council Resolution 13733 and gives domestic effect to the 1999 UN Convention for the Suppression of the Financing of Terrorism. The new legislation was developed having regard to matters under consideration by the FATF in relation to terrorist financing and relevant US and UK laws. Terrorism is defined in the law as is terrorist property, in ways that criminalise the acts of terrorists and render their assets liable to restraint and confiscation, subject to judicial control, and obligates disclosure to the authorities of suspect funds, using existing confidential channels. Counter-terrorist powers of arrest, detention and search where there is reasonable suspicion that a person is a terrorist are also included, and a range of acts are made terrorist offences.4

As of September 2003

1Such legislation will complement the relevant Order in Council promulgated by the UK on behalf of its Overseas Territories.

2e.g. instructing and receiving instructions in use of firearms, explosives, chemical, biological or nuclear weapons; directing activities of a terrorist organisation; possessing articles relating to commission, preparation or instigation of an act of terrorism; recording or collecting information likely to be useful to a person preparing an act of terrorism; inciting terrorism overseas.

3UN sanctions are as a matter of course extended to the Overseas Territories by Orders promulgated by the UK.

4Revokes SI 1990/1652; SI 1990/1988; SI 1993/1245.