Caribbean countries are taking a page out of the United State’s book and going all-in on banking. Banking has been the number one industry in the United States for more than three decades and now the Caribbean is starting to catch up.
Tropical weather, a vibrant culture, and a cheap cost of living are not the only things that the Caribbean offers visitors and foreign investors. For more than fifteen years, the Caribbean has slowly become the go-to place for Americans to open a foreign bank.
There are many reasons behind this, to operate from different jurisdictions and gain ahead in the market, relatively low cost of the license, and to take advantage of all the tax incentives offered by all these tropical paradises.
Dominica is one country in the Caribbean that is often overlooked when American investors are looking for a place to open a bank. I recommend you take a look at Dominica as the future looks bright for this small island.
In the country of Dominica, the authority that all International Banks must follow is called the Financial Services Unit. This government institution is in charge of regulating all the financial activities done inside of the country.
Under the Financial Services Unit, you will also find the Money Laundering Supervisory Authority. The Money Laundering Supervisory Authority is in charge of conducting risk assessments, installing policies, procedures, control methods, and all other relevant risks identified while performing international banking activities in the country.
Some of the documents that you have to comply with in order to pass the strict due diligence requirements include:
– Fingerprint and Photograph Verification
– Approved Medical Certificate
– Passport of all involved Parties
– Birth Certificate
– Proof of Residential Address
– One Professional Reference
– Financial Statements
– Business Plan
– Letter to the Minister
– Bank References
– Personal References
– Investment Schedule
– Audited Financial Reports
Professionals on the island will make sure that every document that they receive from you is analyzed and reviewed properly. It is important to notarize and apostille documents that apply in the Dominica Consulate.
Recent years have seen the regulatory framework of the country of Dominica grow and become more stringent. Although the country is extremely welcoming of foreign investors and basically anyone who wishes to open an offshore bank, they are looking for quality offshore banks, not quantity.
For this reason, the Financial Service Unit in Dominica is known to be one of the harshest in the Caribbean. Their due diligence requirements are known to be strict, but not impossible. At this moment there are 8 offshore banks operating in the country.
International Banks who are currently operating in Dominica include Cathedral Investment Bank, Arton Bank Corporation, Barnett Capital Bank, Commonwealth Bank, BBP Bandenia Private Bank, IBank Corporation, Zuma Bank Corporation, Interoceanic Bank of the Caribbean, Paxum Bank Limited, and Standard Commerce Bank.
2017 was the year when Dominica joined many developed countries around the world in strengthening their Anti Money Laundering Laws replacing the old regulations by adapting them to what is currently going on regarding anti-money laundering and online banking.
Although it is not exactly similar, you can get an idea of what these new laws look like by looking up Anti Money Laundering laws in your country. Some of the activities that will be under a lot of scrutinies are tax evasion, counterfeiting, copyright infringement, and market manipulation.
One of the biggest challenges that was imposed by the law is how banks should choose which customers to work with. The new regulations make it hard for any bank to do business with a client who does not provide all the necessary information.
Secrecy Laws apply under the regulatory framework, but in order for them to comply with the Financial Service Authority of Dominica, the identity of the individual who is doing business must be verified and approved.
Next Article we will talk about how to get a banking license in Dominica, but you must first take into consideration all of the guidelines that are currently protecting the industry in order for you to decide to invest.