Jamaica’s recent removal from the European Union’s anti-money laundering (AML) high-risk third country list represents a major step forward for the country’s financial sector. The European Parliament’s decision, following a recommendation from the European Commission, comes after years of reforms, monitoring, and cooperation between Jamaican authorities, the Financial Action Task Force (FATF), and EU regulatory bodies. This development signals international confidence in Jamaica’s AML and counter-terrorism financing (CTF) framework, opening the door to expanded investment, trade, and financial services.

The EU’s list of high-risk third countries is part of its legal framework designed to protect the bloc’s financial system from money laundering and terrorist financing risks. Under Regulation (EU) 2016/1675, the European Commission maintains and regularly updates the list in line with the findings and recommendations of the FATF. Being on the list triggers enhanced due diligence requirements for financial institutions in the EU when dealing with entities or transactions involving the listed country, often resulting in delays, increased compliance costs, and reputational damage for the affected jurisdiction.

Jamaica’s removal from the list was not a mere procedural change but the culmination of a coordinated national response to address gaps identified by the FATF. These efforts have been monitored by both the FATF’s International Cooperation Review Group and the EU’s own regulatory arms, ensuring that progress is both substantial and sustainable.

Understanding the EU High-Risk List and FATF Grey List Dynamics

The European Union’s high-risk third country list functions as a key pillar of the bloc’s broader anti-financial crime apparatus. As mandated by Article 9 of Directive (EU) 2015/849 (the Fourth AML Directive, as amended), the list serves to identify jurisdictions with strategic deficiencies in their AML/CTF regimes that pose a significant threat to the financial system of the Union. Placement on this list means that EU-based obliged entities must apply enhanced customer due diligence measures in any business relationship or transaction involving the listed country.

Jamaica’s journey with international AML monitoring began in earnest when the FATF placed the country on its “grey list” in February 2020, following a Mutual Evaluation Report (MER) conducted by the Caribbean Financial Action Task Force (CFATF) in 2017. The assessment found strategic shortcomings in areas such as beneficial ownership transparency, risk-based supervision, and the investigation and prosecution of money laundering offenses. These deficiencies placed Jamaica under increased global scrutiny, affecting correspondent banking relationships and leading to its parallel listing by the EU.

Removal from the FATF grey list in October 2023 reflected the successful completion of a FATF-monitored action plan. This outcome was a prerequisite for the EU’s own process, as the Commission’s methodology closely aligns with the FATF’s findings. The European Parliament’s approval on July 9, 2025, represents the final formal step, affirming Jamaica’s upgraded status and triggering the removal of enhanced due diligence requirements for EU financial institutions.

Key AML/CTF Reforms Driving Jamaica’s Delisting

Jamaica’s exit from the high-risk lists was achieved through a robust, multi-year reform program addressing the FATF and EU-identified deficiencies. Key legislative and regulatory measures included:

• Updating Legal Frameworks: Major amendments to Jamaica’s Proceeds of Crime Act, Terrorism Prevention Act, and the Companies Act to address beneficial ownership and predicate offenses. These changes provided greater clarity on money laundering definitions and established stronger mechanisms for asset forfeiture and the freezing of terrorist assets.
• Strengthening Supervisory Structures: The Bank of Jamaica and the Financial Services Commission enhanced their supervisory approach, implementing risk-based supervision in line with FATF Recommendation 26. Increased training and resources for on-site and off-site inspections contributed to greater effectiveness.
• Improving Beneficial Ownership Transparency: Jamaica established a central register of beneficial ownership for legal persons, accessible to competent authorities, as required under FATF Recommendation 24 and mirrored in Article 30 of the EU AMLD.
• Enhancing Investigative and Prosecution Capabilities: Specialized financial crime units within law enforcement agencies received targeted training, and prosecution rates for money laundering offenses improved. The Director of Public Prosecutions and the Financial Investigations Division (FID) reported increased asset recoveries and successful convictions.
• Risk-Based Approach Implementation: Jamaica’s National Risk Assessment, updated in 2022, informed the adoption of a risk-based approach to AML/CTF across all financial institutions and designated non-financial businesses and professions (DNFBPs).

Each of these measures was subjected to rigorous follow-up monitoring by the FATF, the Caribbean FATF, and EU observers, with evidence of implementation forming the basis for delisting decisions.

Impact on Financial Institutions, Trade, and the Wider Economy

Removal from the EU high-risk list marks a turning point for Jamaica’s financial sector. Banks and other regulated entities can now expect smoother relationships with European counterparties, as transactions involving Jamaican parties will no longer be subject to the EU’s mandatory enhanced due diligence regime under Article 18a of the Fourth AML Directive.

The impact is expected to be most pronounced in the areas of:

• Correspondent Banking: Many Jamaican banks experienced de-risking, with some foreign institutions curtailing or terminating correspondent relationships during the high-risk listing period. Removal from the list makes it easier to maintain and re-establish these relationships, ensuring continued access to international payment systems.
• Trade Facilitation: Jamaican exporters and importers faced higher compliance costs and delays when engaging with European partners. Enhanced due diligence by EU banks often meant longer onboarding times, more documentation requests, and increased transaction scrutiny. Delisting should lower these barriers, making Jamaican goods and services more competitive in the EU market.
• Investment Flows: The removal enhances Jamaica’s attractiveness to foreign investors, particularly in the financial services sector. Venture capital and private equity funds, fintech firms, and multinational banks assess AML/CTF risk as part of their investment due diligence. Reduced risk perception translates to a more favorable investment climate.
• Tourism and Remittances: With fewer financial frictions, the remittance corridors between Jamaica and the EU are expected to benefit, supporting one of the country’s most vital sources of foreign exchange.

It is important to note that these benefits are not automatic. Ongoing vigilance and the maintenance of robust AML/CTF controls remain critical to avoid any backsliding that could trigger renewed international scrutiny.

Ongoing Obligations and Future Challenges

Although Jamaica’s removal from high-risk status is an achievement, it does not signal the end of regulatory oversight or the need for continued progress. FATF and EU standards are subject to periodic updates, and the risk landscape evolves as criminal actors adapt.

Some key areas requiring ongoing attention include:

• Sustained Implementation: Jamaica must maintain the effectiveness of its AML/CTF framework through consistent application of laws and regulations. The FATF’s effectiveness ratings, not just technical compliance, remain a global benchmark.
• Emerging Risks: The rise of virtual assets, fintech innovations, and new payment systems introduces novel risks that require agile regulatory responses. Jamaica’s regulatory bodies must continue to monitor and adapt to these developments, as highlighted by the FATF’s recent guidance on virtual asset service providers (VASPs).
• Capacity Building: Continuous investment in training and resources for regulators, supervisors, law enforcement, and judiciary is necessary to ensure skills keep pace with evolving financial crime threats.
• International Cooperation: Ongoing collaboration with regional partners and international agencies is needed to share intelligence, coordinate investigations, and harmonize approaches to AML/CTF challenges.
• Public-Private Partnerships: Encouraging effective communication between regulators and private sector actors, including financial institutions and DNFBPs, supports the detection and reporting of suspicious activity.

Jamaica’s next scheduled mutual evaluation by the Caribbean FATF will be a critical milestone, testing the durability of recent reforms and offering another opportunity to demonstrate leadership in the region’s fight against financial crime.

Conclusion: A Model for Regional AML Progress

Jamaica’s removal from the EU’s AML high-risk list is more than a bureaucratic achievement; it reflects a determined, sustained commitment to strengthening the country’s financial system and meeting international standards. The experience highlights the importance of legal reform, supervisory vigilance, and a risk-based approach in overcoming strategic deficiencies. Other Caribbean and developing nations facing similar challenges may find valuable lessons in Jamaica’s approach: leadership engagement, cross-sector collaboration, and responsiveness to international evaluation processes.

As Jamaica moves forward, it must remain alert to the evolving threat landscape and uphold the reforms that led to its delisting. The positive economic, reputational, and systemic effects of this achievement are already visible, but only ongoing compliance and continuous improvement will ensure lasting benefits for the nation’s financial sector and its partners worldwide.

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Related Links

• Regulation (EU) 2016/1675 — Official EU AML High-Risk Third Countries List
• FATF Public Statement on Jamaica Delisting
• Jamaica Proceeds of Crime Act (POCA)
• EU Fourth Anti-Money Laundering Directive (Directive (EU) 2015/849)
• Bank of Jamaica – AML/CFT Guidance

Other FinCrime Central Articles About the Caribbean

• Uniting the Caribbean to Combat Money Laundering and Terrorism Financing
• Cayman Islands Bolsters Virtual Asset Laws to Secure Top FATF Standing
• Cayman Islands Implements Mandatory Crypto Firm Licensing for Investor Protection

Source: Radio Jamaica News

Some of FinCrime Central’s articles may have been enriched or edited with the help of AI tools. It may contain unintentional errors.

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