The government is prepared to deal with any fallout if the Virgin Islands is censured by global financial watchdogs next month, according to Premier Natalio “Sowande” Wheatley.
His comments come ahead of a June meeting where the Paris-based Financial Action Task Force is expected to decide whether to place the territory on its “grey list” of jurisdictions that require increased monitoring.
The censure would see the VI’s anti-money-crime regime put under extra scrutiny and would impact the territory’s reputation as a financial hub, experts say.
“We are well positioned for whatever the result will be in June — which I won’t pre-empt at all,” Mr. Wheatley said when pressed on the matter during a press conference on Friday afternoon.
Governor Daniel Pruce, who is responsible for law and order in the territory, also downplayed the potential impact of a grey-listing.
“Countries, territories, go onto grey lists, come off of grey lists,” Mr. Pruce said during a separate press conference on Friday morning. “In what I have observed, the crucial factor is how a territory responds to that experience and the nature of what is expected of it during that period.”
Withering report
The grey-list threat has been looming since February 2024, when the FATF’s regional branch, the Caribbean Financial Action Task Force, released a withering report following its mutual evaluation review of the VI.
Like the premier, the governor said the territory has worked hard to follow the CFATF’s recommendations for reform.
“There has been a lot of work conducted across government in response to those initial findings and the mutual evaluation review,” he said. “A lot of credit is due to people who have worked tirelessly to respond to those — and a magnificent effort, I think, across many government ministries.”
The governor added that he does not know what will happen next month.
“It’s not something for me to anticipate — I’m not going to second guess,” he said. “Those discussions will take place in the appropriate forum at the appropriate moment. I’m not going to interpret or exercise a judgement on lots of other commentary about the approach toward the June meeting. We will see what happens at the plenary in June.”
Increased chances?
Experts have suggested that the territory’s chances of being grey-listed increased following the release last month of the second volume of the law-enforcement review by His Majesty’s Inspectorate of Constabulary and Fire and Rescue Services.
The scathing report noted “problems with BVI agencies’ capacity and capability to tackle illicit finance.”
It added, “The [CFATF] report highlighted significant shortcomings in these measures and gave the BVI until February 2025 to make progress. If it fails to do this, the FATF will place the BVI on the ‘grey list’ of jurisdictions under increased monitoring. This would have a negative effect on the BVI economy and potentially affect the UK economy.”
‘Story of resilience’
The premier, however, said on Friday afternoon that he does not accept all the findings in the HMICFRS report.
“We have done quite a bit of work that wasn’t recognised in that law-enforcement review,” he said. “But we are going to make sure that we tell our story, because it’s a story of resilience. It’s a story of seeking to adhere to the highest standards of financial governance.”
He added that the review also included some positive findings.
“I don’t look at these reports as necessarily negatively,” he said. “I look at the opportunity for us to examine our systems and to see how we can improve.”
Other jurisdictions
If the VI is placed on the grey list, it will join 25 other jurisdictions, including Haiti, Angola, Monaco, Syria, Yemen and Vietnam.
The Cayman Islands was taken off the grey list in 2023 after a series of reforms.
