The purpose of this page is to provide a brief explanation of how the Isle of Man can cooperate with and assist overseas regulatory bodies and law enforcement authorities on matters related to financial activities. This statement provides direct links to the persons who can provide assistance.
The Isle of Man Financial Services Authority (“the Authority”) is the regulator for financial services activities in the Isle of Man, including deposit taking, pensions and other investment business, insurance businesses, corporate and trust services and money service businesses including bureaux de change.
The Authority believes that appropriate international cooperation between regulators is fundamental to the integrity of the international financial system and is committed to meeting its international obligations. In addition, the Authority believes that responsible and appropriate international cooperation can be an effective and powerful tool assisting both supervisory authorities and law enforcement agencies in the protection of global financial systems from those who would wish to abuse them to launder money, or to finance terrorist activities or the proliferation of weapons of mass destruction.
The Authority recognises the importance of establishing new relationships, as well as maintaining and developing further existing relationships with other supervisory authorities internationally as well as those closer to home, to allow the appropriate and timely exchange of information to facilitate cross-border and cross-sectoral supervision of both the individual legal entity and on a group-wide basis.
The Authority is committed to compliance with the Basel Core Principles in prudential regulation of banking institutions, with the Insurance Core Principles of the International Association of Insurance Supervisors (“IAIS”) in respect of insurance business and with the International Organisation of Securities Commission’s (“IOSCO”) Objectives and Principles of Securities Regulation. It is committed to compliance with the Financial Action Task Force (FATF) Recommendations on the prevention of money laundering and the countering of the financing of terrorism. The Authority also adopts a policy of keeping its legislation and regulatory gateways up-to-date to meet international standards of cooperation and assistance as they develop.
The Authority is a member of the IAIS, IOSCO and the International Organisation of Pension Supervisors (“IOPS”) and has been accepted as a signatory to both the IAIS and the IOSCO Multilateral Memoranda of Understanding (“MMOUs”) in respect of cooperation and the exchange of Information. The Authority is also a member of GIFCS (the Group of International Financial Centre Supervisors which was formerly known as the Offshore Group of Banking Supervisors) and GIICS (Group of International Insurance Centre Supervisors which was formerly known as the Offshore Group of Insurance Supervisors). In addition, the Authority is a member of, and participates in, a number of supervisory colleges in respect of groups of which Isle of Man insurers are members and liaises with supervisors in the Isle of Man and elsewhere about matters of common interest including systemic risk, group-wide solvency and group crisis management plans.
The Isle of Man, along with the Crown Dependencies of Jersey and Guernsey, has been a participant in the AML/CFT evaluation processes of MONEYVAL since December 2012. Although the Isle of Man is not a member of the European Union, the Authority believes that its powers of regulatory co-operation and assistance are fully compatible with EU requirements in the critical areas.
Power to exchange information
Similar to other supervisory bodies, the Authority has a statutory duty of confidentiality in respect of information collected in the performance of its functions under relevant legislation. Such information is classified as restricted information and may only be disclosed to third parties with the consent of the person from whom the information was received and, if different, the person to whom it relates, subject to the statutory gateways set out in Schedule 6 to the Insurance Act 2008 (“IA08”) and Schedule 5 to the Financial Services Act 2008 (“FSA08”).
These gateways permit the Authority to disclose relevant restricted information, subject to certain safeguards, with recognised regulators and other agencies for a valid supervisory purpose or in respect of any criminal proceedings or investigations which have been or may be initiated in the Island or elsewhere.
Memorandums of Understanding
The legal powers of Schedule 6 to the IA08 and Schedule 5 to the FSA08, which enable the Authority to co-operate with other regulatory organisations both domestically and internationally, are supported by a number of bilateral Memorandums of Understanding with regulatory authorities world-wide, as well as by the MMOU’s of the IAIS and IOSCO. The purpose of a memorandum of understanding is to establish an agreed mechanism under which the signatories commit to using their statutory powers of co-operation to assist each other.
The Authority does not require a memorandum of understanding to be in place with a regulatory authority before it will co-operate with or share information with that authority under its general powers.
Mutual Assistance - who to approach with a request for assistance
In the Isle of Man there are a number of bodies which can deal with mutual assistance requests in differing circumstances. The details set out below are high level summaries of some of the key powers.
The Isle of Man Financial Services Authority is able to provide assistance to overseas authorities in relation to the regulation and supervision of licensed financial services businesses. This power is of particular importance in the global financial services market place to ensure consolidated supervision of regulated groups. Examples can include:
The Authority does not regulate the customers of the entities it regulates and it is therefore appropriate that the power to obtain information relating to customers is focused upon regulatory matters and circumstances where it is needed for the protection of a customer of an entity regulated by the Authority.
However, it is important that powers are available to cover circumstances where the Isle of Man has been used to abuse regulatory laws and requirements in other countries, even though there may not have been a specific breach of local Isle of Man legislation. If information about a customer is needed for other purposes such as the following there are appropriate powers through which information can be sought:
- a securities investigation;
- an investigation into Insider Dealing;
- an investigation into Serious and Complex Fraud or any other criminal matters; or
- a customs investigation.
If you require any regulatory information about a financial institution (including an insurance company, insurance broker or pensions provider) you should contact the Authority.
Breaches of Securities Law – Isle of Man Financial Services Authority powers
The Authority recognises the importance of ensuring the integrity of financial markets. Where an overseas securities regulator has entered into a mutual assistance agreement with the Authority, the Authority is empowered to exercise powers on their behalf to assist in the exercise of their functions.
Thus, the Authority can exercise its powers of inspection and investigation, including the power to obtain written and oral explanations and to require the production of documents, on behalf of that regulator.
The Authority may also communicate to that regulator information which is in its possession, whether or not as a result of the exercise of any of its powers, subject to certain legal safeguards and conditions.
These broad powers have been used to assist other regulators in investigating allegations of market manipulation and market abuse.
Insider dealing – Isle of Man Financial Services Authority powers
Under the Insider Dealing Act 1998, the Authority may appoint an inspector, following a request from the authorities in another jurisdiction, to investigate activities in the Island which, whether taken alone or in conjunction with activities elsewhere, might have amounted to insider dealing. Enquiries in relation to Insider Dealing should be addressed to the Authority.
The Attorney General’s Chambers and Financial Intelligence Unit
The Attorney General’s Chambers is the main point of contact for enquiries relating to non-regulatory criminal matters.
The Financial Intelligence Unit (“FIU”) is the contact point for submission of all suspicious activity reports. The FIU is a member of the EGMONT Group of Financial Intelligence Units. It is therefore possible for other EGMONT FIUs to contact the FIU using the EGMONT secure channels of communication.
The FIU works closely with the Attorney General’s Chambers in relation to requests for assistance from overseas authorities. If assistance is sought in relation to the following, please contact the Attorney General’s Chambers in the first instance. When making a request to the Attorney General’s Chambers, enquirers will need to provide sufficient supporting information to demonstrate that the alleged misdemeanour is:
- money laundering;
- terrorist financing;
- serious or complex fraud;
- criminal matters;
- restraint (freezing) and confiscation of assets held in the Island which we suspected to represent the proceeds of crime; or
- civil recovery of the proceeds of crime.
Customs and Excise
The Isle of Man is in a customs union with the UK and is part of the customs territory of the European Community (Community customs law generally applies in the Island).
The Island is fully committed to upholding international sanctions, whether imposed by the United Nations (“UN”) or European Union (“EU”). Customs and Excise is the relevant enforcement agency for trade and financial sanctions in most cases.
Customs and Excise will normally deal with requests for cooperation concerning:
- customs matters;
- excise matters;
- UN and EU financial/economic sanctions;
- trade sanctions and embargoes;
- export licensing (including cultural goods); and
- trade licenses for “trafficking and brokering” i.e. moving of certain restricted goods.
Gambling Supervision Commission
The Gambling Supervision Commission is the main point of contact for enquiries relating to gambling and e-gaming matters.
The Companies Registry is the repository for public information about Isle of Man Companies.