United Nations Convention against Corruption
Self-assessment Name: UK Crown Dependency - Isle of Man
Country: United Kingdom of Great Britain and Northern Ireland
Date of creation: 23/11/2017
Assessor: Renny Mendoza
Assessor Position: International Policy Advisor - Joint Anti-Corruption Unit
Release: 3.0.0.15
Comments:
Completed self-assessment checklists should be sent to:
Corruption and Economic Crime Section Division for Treaty Affairs United Nations Office on Drugs and Crime Vienna International Centre PO Box 500 1400 Vienna, Austria
Attn: KAMBERSKA Natasha
Telephone: + (43) (1) 26060-4293 Telefax: + (43) (1) 26060-74293 E-mail: [email protected] A. General information A. General information 1. General information
1519 1 Focal point: See UK submission. 2 Institutions consulted: See UK submission. 3 Please provide information on the ratification/acceptance/approval/accession process of the United Nations Convention against Corruption in your country (date of ratification/acceptance/approval of/accession to the Convention, date of entry into force of the Convention in your country, procedure to be followed for ratification/acceptance/approval of/accession to international conventions etc.). See UK submission. 4 Please briefly describe the legal and institutional system of your country. See UK submission. 5 In a separate communication addressed and e-mailed to the secretariat ([email protected]), please provide a list of relevant laws, policies and/or other measures that are cited in the responses to the self-assessment checklist along with, if available online, a hyperlink to each document and, if available, summaries of such documents. For those documents not available online, please include the texts of those documents and, if available, summaries thereof in an attachment to the e-mail. If available, please also provide a link to, or the texts of, any versions of these documents in other official languages of the United Nations (Arabic, Chinese, English, French, Russian or Spanish). Please revert to this question after finishing your self-assessment to ensure that all legislation, policies and/or other measures you have cited are included in the list. 6 Please provide a hyperlink to or copy of any available assessments of measures to combat corruption and mechanisms to review the implementation of such measures taken by your country that you wish to share as good practices. See UK submission. 7 Please provide the relevant information regarding the preparation of your responses to the self- assessment checklist. See UK submission. 8 Please describe three practices that you consider to be good practices in the implementation of the chapters of the Convention that are under review. See UK submission. 9 Please describe (cite and summarize) the measures/steps, if any, your country needs to take, together with the related time frame, to ensure full compliance with the chapters of the Convention that are under review, and specifically indicate to which articles of the Convention such measures would relate. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 2 of 129 Great Britain and Northern Ireland II. Preventive measures 5. Preventive anti-corruption policies and practices 2. Paragraph 1 of article 5
1. Each State Party shall, in accordance with the fundamental principles of its legal system, develop and implement or maintain effective, coordinated anti-corruption policies that promote the participation of society and reflect the principles of the rule of law, proper management of public affairs and public property, integrity, transparency and accountability.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. In 2013 the IOM adopted a new Bribery Act which is closely based on the UK’s Bribery Act 2010. Under the IOM’s 2013 Act it is an offence for commercial organisations to fail to prevent bribery (subject, as in the UK, to the organisation having a defence if has in place adequate procedures to prevent persons associated with it from engaging in conduct that constitutes an offence under the Act). Following the adoption of the Act the IOM published guidance to assist relevant organisations with compliance:
1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 3 of 129 Great Britain and Northern Ireland Incoming letters of request (ILORs): 2013 2014 Money laundering (ML) 7 8 ML + Corruption 4 2 ML + Fraud 15 14 ML + Drugs 1 0 ML + Tax Evasion 0 2 ML + Organised Crime 0 0 Terrorist Financing 0 0 Corruption 4 3 Tax Evasion 8 5 Fraud 24 17 Drugs 4 1 Other 17 11 Total requests 84 63
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 4 of 129 Great Britain and Northern Ireland 3. Paragraph 2 of article 5
2. Each State Party shall endeavour to establish and promote effective practices aimed at the prevention of corruption.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See information under Article 5(1) and also Article 9. 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See previous answer.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 5 of 129 Great Britain and Northern Ireland 4. Paragraph 3 of article 5
3. Each State Party shall endeavour to periodically evaluate relevant legal instruments and administrative measures with a view to determining their adequacy to prevent and fight corruption.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The IOM introduced a Corruption Act in 2008 in order to comply with various international requirements, including those under this convention. The IOM followed developments in the UK which led to UK’s Bribery Act 2010 and it subsequently agreed that new IOM legislation based on that Act, which was seen as representing a new standard for anti- corruption legislation, should be adopted. The resulting Bribery Act 2013 ensures a similarity in the general principles behind the prosecution of bribery that would in due course enable the IOM to rely on UK judicial authority, where appropriate. 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. Bribery Act 2013
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 6 of 129 Great Britain and Northern Ireland 5. Paragraph 4 of article 5
4. States Parties shall, as appropriate and in accordance with the fundamental principles of their legal system, collaborate with each other and with relevant international and regional organizations in promoting and developing the measures referred to in this article. That collaboration may include participation in international programmes and projects aimed at the prevention of corruption.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The IOM has a close and effective working relationship with the UK, which in turn collaborates with other State Parties and international organisations. 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See above
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 7 of 129 Great Britain and Northern Ireland 6. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. No.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 8 of 129 Great Britain and Northern Ireland 6. Preventive anti-corruption body or bodies 7. Paragraph 1 of article 6
1. Each State Party shall, in accordance with the fundamental principles of its legal system, ensure the existence of a body or bodies, as appropriate, that prevent corruption by such means as: (a) Implementing the policies referred to in article 5 of this Convention and, where appropriate, overseeing and coordinating the implementation of those policies; (b) Increasing and disseminating knowledge about the prevention of corruption.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. A number of IOM bodies have functions that are relevant to this Article. Under the Police Act 1993, the Isle of Man Government’s Department of Home Affairs (DHA) must, after consultation with the Council of Ministers, appoint a fit person to be the Chief Constable for the Isle of Man Constabulary. It is the duty of the DHA to secure the maintenance of an efficient and effective police force for the Island so as to ensure the effective preservation of law and order. The police force is under the direction and control of the Chief Constable. The Department must, after consultation with the Chief Constable and with various other bodies- (a) determine the policies, objectives and priorities of the police force; and (b) prepare and lay before Tynwald once in every year a plan specifying those policies, objectives and priorities and the means by which it is intended that they be achieved. Under section 4A of the Act, the Chief Constable shall, as soon as possible after the 31st March in each year, submit to the Department a general report in writing on the policing of the Island during the year ending on that date. The Department must cause a copy of the report to be laid before Tynwald, and the Minister for Home Affairs must move a resolution that the report be received by Tynwald. In operational matters, therefore, the autonomy and independence of the Constabulary is recognised. The IOM Constabulary has a Financial Crime Unit. By constitutional convention, the Isle of Man’s Attorney General is appointed directly by Her Majesty the Queen and acts as legal adviser to the Island’s Lieutenant Governor, Council of Ministers, Government Departments and Statutory Boards. HM Attorney General is required to offer guidance on matters of law and issues relating to the Isle of Man's domestic and external interests. He is also responsible for representing the Crown in the prosecution of offences and for the drafting of Government legislation. Along with his fellow Crown appointment, HM Solicitor General, the Attorney General has complete autonomy and independence in the prosecution of criminal matters and has a staff of prosecutors under a director of prosecutions. All of these persons are qualified lawyers with experience in criminal matters. In his capacity as adviser to the Government on other matters, HM Attorney General has complete autonomy and independence to give the most accurate and impartial advice to the Government possible. The Isle of Man Financial Services Authority (IOMFSA) is the IOM’s regulator for the IOM’s financial services industry. Its regulatory objectives of the are: 1. securing an appropriate degree of protection for policyholders, members of
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 9 of 129 Great Britain and Northern Ireland retirement benefits schemes and the customers of persons carrying on a regulated activity; 2. the reduction of financial crime; and 3. the maintenance of confidence in the Island’s financial services, insurance and pensions industries through effective regulation, thereby supporting the Island’s economy and its development as an international financial centre. The functions of the IOMFSA as set out in the Financial Services Act 2008 and the Insurance Act 2008 and include - · the regulation and supervision of persons undertaking regulated activities in respect of deposit taking, investment business, services to collective investment schemes, fiduciary services and money transmission services, in or from the Isle of Man; · the regulation and supervision of persons undertaking regulated activities in respect of insurance and pensions, in or from the Isle of Man; · the regulation and supervision of collective investment schemes within the meaning of the Collective Investment Schemes Act 2008; · the regulation and supervision of retirement benefits schemes within the meaning of the Retirement Benefits Schemes Act 2000; · the maintenance and development of the regulatory regime for all of the above; · the conduct of investigations into any potential liability arising from breach of AML/CFT legislation by persons undertaking regulated activities; · the oversight of directors and persons responsible for the management, administration or affairs of commercial entities; · participation in consultative bodies, working groups and other arrangements. The work of the IOMFSA is overseen by not less than seven Members appointed by the Treasury, subject to the approval of Tynwald. The Chief Executive is also a Member. The Isle of Man's Financial Intelligence Unit (FIU) was established by the Financial Intelligence Unit Act 2016 (
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 10 of 129 Great Britain and Northern Ireland 8. Paragraph 2 of article 6
2. Each State Party shall grant the body or bodies referred to in paragraph 1 of this article the necessary independence, in accordance with the fundamental principles of its legal system, to enable the body or bodies to carry out its or their functions effectively and free from any undue influence. The necessary material resources and specialized staff, as well as the training that such staff may require to carry out their functions, should be provided.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See information under 6.1. 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 11 of 129 Great Britain and Northern Ireland 9. Paragraph 3 of article 6
3. Each State Party shall inform the Secretary-General of the United Nations of the name and address of the authority or authorities that may assist other States Parties in developing and implementing specific measures for the prevention of corruption.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1528 1 Has your country provided the information as prescribed above? If so, please also provide the appropriate reference. The IOM is a Crown Dependency and the UK is responsible for the IOM’s international relations. As the State Party the UK is responsible for submitting any such notifications.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 12 of 129 Great Britain and Northern Ireland 10. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. none. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 13 of 129 Great Britain and Northern Ireland 7. Public sector 11. Paragraph 1 of article 7
1. Each State Party shall, where appropriate and in accordance with the fundamental principles of its legal system, endeavour to adopt, maintain and strengthen systems for the recruitment, hiring, retention, promotion and retirement of civil servants and, where appropriate, other non-elected public officials: (a) That are based on principles of efficiency, transparency and objective criteria such as merit, equity and aptitude; (b) That include adequate procedures for the selection and training of individuals for public positions considered especially vulnerable to corruption and the rotation, where appropriate, of such individuals to other positions; (c) That promote adequate remuneration and equitable pay scales, taking into account the level of economic development of the State Party;
(d) That promote education and training programmes to enable them to meet the requirements for the correct, honourable and proper performance of public functions and that provide them with specialized and appropriate training to enhance their awareness of the risks of corruption inherent in the performance of their functions. Such programmes may make reference to codes or standards of conduct in applicable areas.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The IOM has adopted and published “The Government Code” (
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 14 of 129 Great Britain and Northern Ireland 12. Paragraph 2 of article 7
2. Each State Party shall also consider adopting appropriate legislative and administrative measures, consistent with the objectives of this Convention and in accordance with the fundamental principles of its domestic law, to prescribe criteria concerning candidature for and election to public office.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Section 1(1) of the Representation of the People Act 1995 provides that a person may stand as a candidate for, and be elected a member of, the Isle of Man’s House of Keys for a constituency if at the time of nomination as a candidate the person - (a) has reached the age of majority, (b) is either a British citizen or has the right to remain in the Isle of Man, (c) is ordinarily resident in the Island and has been so resident for a period of, or for periods amounting in the aggregate to, 5 years or more, and (d) is registered on the register of electors for any electoral area in the Island, provided that the person is not disqualified under section 1(2). Section 1(2) of the Representation of the People Act 1995 provides that a person is disqualified from being a candidate for election for the Isle of Man’s House of Keys if at the time the person is nominated as a candidate the person - (a) is the holder of an office of profit under the government of any country or territory outside the Island; (b) has been convicted of a relevant offence, unless the conviction is spent for the purposes of the Rehabilitation of Offenders Act 2001; (c) is incapable of being elected to and sitting in the Keys by virtue of section 66 (incapacities on report or conviction of corrupt or illegal practice); (d) is serving a custodial sentence following conviction for any offence; (e) is an undischarged bankrupt; or (f) is subject to any incapacity by virtue of this or any other Act. A “relevant offence” is an offence (wherever committed) involving corruption, bribery or dishonesty or an offence (of any kind) under this Act or under the legislation of another country or territory equivalent to this Act. Part 4 of the Representation of the People Act 1995 sets out a range of offences relative to corrupt and illegal practices in connection with the conduct of elections. If a candidate who has been elected is reported by the High Court to be personally guilty or guilty by his or her agents of any corrupt or illegal practice his or her election shall be void. Once elected, the Government Code (
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 15 of 129 Great Britain and Northern Ireland 13. Paragraph 3 of article 7
3. Each State Party shall also consider taking appropriate legislative and administrative measures, consistent with the objectives of this Convention and in accordance with the fundamental principles of its domestic law, to enhance transparency in the funding of candidatures for elected public office and, where applicable, the funding of political parties.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Part 2 Division 4 of the Representation of the People Act 1995 (
4. Each State Party shall, in accordance with the fundamental principles of its domestic law, endeavour to adopt, maintain and strengthen systems that promote transparency and prevent conflicts of interest.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. As referred to under 7.1, the Isle of Man Government has a range of measures in place to promote transparency and prevent conflicts of interest. Section A3 of the Civil Service Regulations deals with interests by civil servants in contracts with Government Departments. It provides that, unless a civil servant discloses to their Accounting Officer the measure of their interest in any contract with the Isle of Man Government, and the Accounting Officer has given their permission for the contract, purchase or sale to proceed (notwithstanding the interest held by the civil servant): “(i) no Government contract shall be let to a civil servant or to any partnership of which he is a member (apart from a corporation of more than ten persons in which he is a shareholder); (ii) no Government contract shall be let to any company of which a civil servant is a director (except as a nominee of the Government); iii) no civil servant shall be permitted to accept a directorship (except as a nominee of the Government) in any company holding a contract with the Government.” In addition, no purchase for the Government shall be made from, and no sale for the Government made to, any civil servant without the express sanction of their Accounting Officer and, in no circumstances should any civil servant negotiate or arbitrate in any matter affecting a Government contract, purchase or sale, where in his private capacity he is interested either as principal or as a shareholder in a company being one of the principals to the matter under consideration. Lastly, if a civil servant has occasion officially to come into contact with any matter concerning a business organisation in which he or her has an interest (apart from holding shares in corporations of more than ten persons) that interest must be disclosed to his Accounting Officer so that another civil servant may be appointed to deal with the case. The Isle of Man Government’s Whistleblowing (Confidential Reporting) Policy (September 2016) (
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 17 of 129 Great Britain and Northern Ireland Services Authority; the Communications Commission), together with designated publicly owned companies (e.g., Manx Radio; Isle of Man Film Ltd) and other public authorities (e.g., Attorney General’s Chambers; Isle of Man Constabulary; Clerk of Tynwald; Public Services Commission) are now subject to the Freedom of Information Act 2015 which began to come into effect on 1 February 2016 as part of a phased implementation over a period of two years. By 1 February 2018, the Act will have been extended to the Isle of Man’s system of 22 local authorities consisting of 4 town authorities, 2 district authorities, 2 village authorities, and 14 parish authorities. Implementation of the Act is subject to routine exceptions to the right of access to information felt necessary to maintain a balance with regard to rights to privacy, effective government, and value for the taxpayer. There is a dedicated website which takes members of the public through the application procedure in a user-friendly manner: see -
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 18 of 129 Great Britain and Northern Ireland 15. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 19 of 129 Great Britain and Northern Ireland 8. Codes of conduct for public officials 16. Paragraph 1 of article 8
1. In order to fight corruption, each State Party shall promote, inter alia, integrity, honesty and responsibility among its public officials, in accordance with the fundamental principles of its legal system.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See information under Article 7. 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 20 of 129 Great Britain and Northern Ireland 17. Paragraph 2 and 3 of article 8
// 2. In particular, each State Party shall endeavour to apply, within its own institutional and legal systems, codes or standards of conduct for the correct, honourable and proper performance of public functions. 3. For the purposes of implementing the provisions of this article, each State Party shall, where appropriate and in accordance with the fundamental principles of its legal system, take note of the relevant initiatives of regional, interregional and multilateral organizations, such as the International Code of Conduct for Public Officials contained in the annex to General Assembly resolution 51/59 of 12 December 1996.
1521 Is your country in compliance with these provisions? 0 (Y) Yes
1523 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with these provisions of the Convention. See information under Article 7. 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 21 of 129 Great Britain and Northern Ireland 18. Paragraph 4 of article 8
4. Each State Party shall also consider, in accordance with the fundamental principles of its domestic law, establishing measures and systems to facilitate the reporting by public officials of acts of corruption to appropriate authorities, when such acts come to their notice in the performance of their functions.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Section 13 of the Bribery Act 2013 (
See also information provided under Article 7. 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 22 of 129 Great Britain and Northern Ireland 19. Paragraph 5 of article 8
5. Each State Party shall endeavour, where appropriate and in accordance with the fundamental principles of its domestic law, to establish measures and systems requiring public officials to make declarations to appropriate authorities regarding, inter alia, their outside activities, employment, investments, assets and substantial gifts or benefits from which a conflict of interest may result with respect to their functions as public officials.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Section A2 of the Civil Service Regulations 2015. It provides that the following general principles apply to all members of the Civil Service: “a) The first duty of a civil servant is to give his undivided allegiance to the State at all times and on all occasions when the State has a claim on his services. b) A civil servant must not subordinate his duty to his private interests, neither is he to put himself in a position where his duty and his private interests conflict and he must not make use of his official position to further those interests. c) Though the State is in general not concerned with civil servants' private activities, they must not be such as might bring discredit on the Service, for example, heavy gambling and speculation are to be avoided, particularly in departments which have access to information which could be turned to private gain. d) It is grossly improper for a civil servant to attempt to procure the intervention of Members of the Legislature or a Member of the Public Services Commission who is not a Member of the Legislature or a non Tynwald Member of any statutory body, in the matter of promotion or otherwise with reference to his position in the Civil Service. Canvassing by applicants seeking transfer or promotion to any post will disqualify them from appointment.” See:
The Isle of Man Government’s Financial Regulations (
FG19 provides further guidance on gifts and rewards: “To ensure a consistency of approach between Departments and Boards in the acceptance, recording, distribution and monitoring of gifts, rewards and hospitality, and to ensure that staff are protected from any potential allegations of impropriety which may arise as a consequence of differing practices: 1. A register should be maintained which records as a minimum: · The date of the offer;
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 23 of 129 Great Britain and Northern Ireland · The name of the officer and their job title; · A description of the gift, reward or hospitality; · The (estimated) value; · Who offered the item; · Whether the item was accepted or refused; · A record of any approvals sought; · The date of disclosure. 2. The de minimus limit below which items of hospitality (e.g. a working lunch) need not be declared in the register is £50.00. 3. Where gifts, other than ‘isolated gifts of low value such as diaries, calendars, flowers and chocolates’ have been accepted, and where the nature of the gifts permits such actions, senior management should ensure that the gifts are distributed in accordance with instruction from the Accounting Officer. 4. In determining the application of de minimus limits the total value of the gift/hospitality provided as borne by the provider should be considered and individual items aggregated if appropriate.”
1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 24 of 129 Great Britain and Northern Ireland 20. Paragraph 6 of article 8
6. Each State Party shall consider taking, in accordance with the fundamental principles of its domestic law, disciplinary or other measures against public officials who violate the codes or standards established in accordance with this article.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The Isle of Man Government’s Anti-Bribery Policy and Procedure (September 2016) makes it clear that the Government is committed to investigating rigorously instances of alleged bribery, assisting police and other appropriate authorities in any resultant prosecution, and taking firm and vigorous action against any individuals involved in bribery. It follows that any violation by public officials of the anti-corruption tenets of this Policy will result in disciplinary action against those involved under the Civil Service Regulations and additional action under the criminal law of the Isle of Man.
1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 25 of 129 Great Britain and Northern Ireland 21. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 26 of 129 Great Britain and Northern Ireland 9. Public procurement and management of public finances 22. Paragraph 1 of article 9
1. Each State Party shall, in accordance with the fundamental principles of its legal system, take the necessary steps to establish appropriate systems of procurement, based on transparency, competition and objective criteria in decision-making, that are effective, inter alia, in preventing corruption. Such systems, which may take into account appropriate threshold values in their application, shall address, inter alia:
(a) The public distribution of information relating to procurement procedures and contracts, including information on invitations to tender and relevant or pertinent information on the award of contracts, allowing potential tenderers sufficient time to prepare and submit their tenders;
(b) The establishment, in advance, of conditions for participation, including selection and award criteria and tendering rules, and their publication;
(c) The use of objective and predetermined criteria for public procurement decisions, in order to facilitate the subsequent verification of the correct application of the rules or procedures;
(d) An effective system of domestic review, including an effective system of appeal, to ensure legal recourse and remedies in the event that the rules or procedures established pursuant to this paragraph are not followed;
(e) Where appropriate, measures to regulate matters regarding personnel responsible for procurement, such as declaration of interest in particular public procurements, screening procedures and training requirements.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. IOM Government has published procurement policy (
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 27 of 129 Great Britain and Northern Ireland maintained. The Invitation to Tender document includes an explanation of the right to appeal. The tender process adopted includes a requirement for the relevant Designated Body to provide feedback and for there to be a 10 day standstill period following award which allows a tenderer to appeal. Notwithstanding this right to appeal, an aggrieved tenderer could still challenge any decision made by a designated body through the courts. The procurement policy and procedures require that all personnel who undertake procurement must declare an interest. For those which are undertaken by centralised procurement services, this requires them to complete a declaration of interest. Procurement training is provided by HM Attorney General’s Chambers. 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 28 of 129 Great Britain and Northern Ireland 23. Paragraph 2 of article 9
2. Each State Party shall, in accordance with the fundamental principles of its legal system, take appropriate measures to promote transparency and accountability in the management of public finances. Such measures shall encompass, inter alia: (a) Procedures for the adoption of the national budget; (b) Timely reporting on revenue and expenditure; (c) A system of accounting and auditing standards and related oversight; (d) Effective and efficient systems of risk management and internal control; and (e) Where appropriate, corrective action in the case of failure to comply with the requirements established in this paragraph.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The Treasury Act 1985
The Audit Act 2006
The Regulations also stipulate: · the proper accounting practices that must be applied in the preparation and presentation of accounts (Regulation 3); · the requirements in relation to Accounting Systems and the keeping of records (Regulation 5); · that all bodies with a gross income or expenditure of >£200k must maintain a system of Internal Audit (Regulation 6); · that accounts need to include a formal statement of internal control (Regulations 7 & 9).
1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. In addition to the above:
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 29 of 129 Great Britain and Northern Ireland Isle of Man Government Budget 2017-18
Tynwald Order Paper No.2 21st February 2017 (Submission of Budget)
Isle of Man Government Accounts 2015/16
Tynwald Order Paper 15th November 2016 (Laying of Government Accounts before Tynwald)
Department of Infrastructure Local Government Accounts Report to Tynwald (March 2017)
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 30 of 129 Great Britain and Northern Ireland 24. Paragraph 3 of article 9 3. Each State Party shall take such civil and administrative measures as may be necessary, in accordance with the fundamental principles of its domestic law, to preserve the integrity of accounting books, records, financial statements or other documents related to public expenditure and revenue and to prevent the falsification of such documents.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The Audit Act 2006
· every public body to have its accounts inspected (audited/reviewed or examined) by an independent and suitably qualified inspector (Section 1); · for the inspector to undertake an examination of the accounts to determine, amongst other things, whether the accounts give a true and fair view of the bodies affairs and whether any transactions undertaken by the body have been or will be contrary to law (Sections 4 and 4A); · providing the inspector with a statutory right of access to documents and information (Section 5); · for the public body to make the inspectors report and the relevant accounts available for public inspection within 21 days of the inspectors report.
In addition, the Treasury Act 1985
1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. Publication of Audited/Inspected Accounts: Isle of Man Government Accounts 2015/16
Department of Infrastructure Local Government Accounts Report to Tynwald (March 2017)
Financial Directions issued by The Treasury to Designated Bodies (per Section 3 of the Treasury Act 1985): Isle of Man Government Financial Regulations (September 2017)
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 31 of 129 Great Britain and Northern Ireland No. of internal financial whistleblowing reports made: · 2014/15: 20 reports; · 2015/16: 32 reports; · 2016/17: 30 reports.
Additional relevant policies: Isle of Man Government Anti-Bribery Policy & Procedure
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 32 of 129 Great Britain and Northern Ireland 25. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. Treasury is currently undertaking a review of the Accounts & Audit Regulations issued in accordance with the Audit Act 2006 - it is anticipating going out to consultation with revised regulations prior to the 2018/19 accounting period.
Treasury is also undertaking a fundamental review of the Financial Directions(the ‘Financial Regulations’) issued pursuant to Section 3 of the Treasury Act - again it is anticipating implementing revised Directions for the 2018/19 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. Accounts & Audit Regulations review: Treasury is receiving technical assistance from Grant Thornton Limited.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 33 of 129 Great Britain and Northern Ireland 10. Public reporting 26. Subparagraph (a) of article 10
Taking into account the need to combat corruption, each State Party shall, in accordance with the fundamental principles of its domestic law, take such measures as may be necessary to enhance transparency in its public administration, including with regard to its organization, functioning and decision-making processes, where appropriate. Such measures may include, inter alia: (a) Adopting procedures or regulations allowing members of the general public to obtain, where appropriate, information on the organization, functioning and decision-making processes of its public administration and, with due regard for the protection of privacy and personal data, on decisions and legal acts that concern members of the public;
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. All Isle of Man Government Departments and Statutory Boards (e.g., the Financial Services Authority; the Communications Commission), together with designated publicly owned companies (e.g., Manx Radio; Isle of Man Film Ltd) and other public authorities (e.g., Attorney General’s Chambers; Isle of Man Constabulary; Clerk of Tynwald; Public Services Commission) are now subject to the Freedom of Information Act 2015 (
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 35 of 129 Great Britain and Northern Ireland 27. Subparagraph (b) of article 10
Taking into account the need to combat corruption, each State Party shall, in accordance with the fundamental principles of its domestic law, take such measures as may be necessary to enhance transparency in its public administration, including with regard to its organization, functioning and decision-making processes, where appropriate. Such measures may include, inter alia: ... (b) Simplifying administrative procedures, where appropriate, in order to facilitate public access to the competent decision-making authorities; and
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See information under 10(a). 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See information under 10(a).
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 36 of 129 Great Britain and Northern Ireland 28. Subparagraph (c) of article 10
Taking into account the need to combat corruption, each State Party shall, in accordance with the fundamental principles of its domestic law, take such measures as may be necessary to enhance transparency in its public administration, including with regard to its organization, functioning and decision-making processes, where appropriate. Such measures may include, inter alia: ... (c) Publishing information, which may include periodic reports on the risks of corruption in its public administration.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See information under 10(a). 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See information under 10(a).
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 37 of 129 Great Britain and Northern Ireland 29. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 38 of 129 Great Britain and Northern Ireland 11. Measures relating to the judiciary and prosecution services 30. Paragraph 1 of article 11
1. Bearing in mind the independence of the judiciary and its crucial role in combating corruption, each State Party shall, in accordance with the fundamental principles of its legal system and without prejudice to judicial independence, take measures to strengthen integrity and to prevent opportunities for corruption among members of the judiciary. Such measures may include rules with respect to the conduct of members of the judiciary.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The Isle of Man judiciary have a Code of Conduct which can be seen at
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 39 of 129 Great Britain and Northern Ireland 31. Paragraph 2 of article 11
2. Measures to the same effect as those taken pursuant to paragraph 1 of this article may be introduced and applied within the prosecution service in those States Parties where it does not form part of the judiciary but enjoys independence similar to that of the judicial service.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The prosecution function rests with HM Attorney General’s Chambers. The Prosecution Division is supervised by HM Solicitor General. Prosecutors are public servants and are subject to the Government Code:
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 40 of 129 Great Britain and Northern Ireland 32. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 41 of 129 Great Britain and Northern Ireland 12. Private sector 33. Paragraphs 1 and 2 of article 12
1. Each State Party shall take measures, in accordance with the fundamental principles of its domestic law, to prevent corruption involving the private sector, enhance accounting and auditing standards in the private sector and, where appropriate, provide effective, proportionate and dissuasive civil, administrative or criminal penalties for failure to comply with such measures. 2. Measures to achieve these ends may include, inter alia: (a) Promoting cooperation between law enforcement agencies and relevant private entities; (b) Promoting the development of standards and procedures designed to safeguard the integrity of relevant private entities, including codes of conduct for the correct, honourable and proper performance of the activities of business and all relevant professions and the prevention of conflicts of interest, and for the promotion of the use of good commercial practices among businesses and in the contractual relations of businesses with the State; (c) Promoting transparency among private entities, including, where appropriate, measures regarding the identity of legal and natural persons involved in the establishment and management of corporate entities; (d) Preventing the misuse of procedures regulating private entities, including procedures regarding subsidies and licences granted by public authorities for commercial activities; (e) Preventing conflicts of interest by imposing restrictions, as appropriate and for a reasonable period of time, on the professional activities of former public officials or on the employment of public officials by the private sector after their resignation or retirement, where such activities or employment relate directly to the functions held or supervised by those public officials during their tenure; (f) Ensuring that private enterprises, taking into account their structure and size, have sufficient internal auditing controls to assist in preventing and detecting acts of corruption and that the accounts and required financial statements of such private enterprises are subject to appropriate auditing and certification procedures.
1521 Is your country in compliance with these provisions? 0 (Y) Yes
1523 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with these provisions of the Convention. The Audit Act 2006
The IOM has established a central register of beneficial ownership under the Beneficial Ownership Act 2017:
The Audit Act 2006
Under the Bribery Act 2013
1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 43 of 129 Great Britain and Northern Ireland 34. Paragraph 3 of article 12
3. In order to prevent corruption, each State Party shall take such measures as may be necessary, in accordance with its domestic laws and regulations regarding the maintenance of books and records, financial statement disclosures and accounting and auditing standards, to prohibit the following acts carried out for the purpose of committing any of the offences established in accordance with this Convention:
(a) The establishment of off-the-books accounts;
(b) The making of off-the-books or inadequately identified transactions;
(c) The recording of non-existent expenditure;
(d) The entry of liabilities with incorrect identification of their objects;
(e) The use of false documents;
(f) The intentional destruction of bookkeeping documents earlier than foreseen by the law.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. There are record-keeping requirements and related offences for non-compliance which apply to all financial institutions and designated non-financial businesses and professions (as defined by FATF). These are contained in the Anti-Money Laundering and Countering the Financing of Terrorism Code 2015
a) Paragraphs 32(b) and 33(1)(a) - records on transactions, both domestic and international must be kept for at least five years following completion of the transaction. b) Paragraphs 32(a) and 33(1)(b) - all records through customer due diligence measures must be retained for at least five years following the termination of the business relationship or after the date of the transaction. This includes business correspondence, analysis, account files etc. c) Paragraph 32(c) - requires transaction records to be sufficient to permit the reconstruction of individual transactions. d) Paragraph 33(2) - the records required by the Code must be kept as long as required by a constable or competent authority if a suspicious transaction report has been made to the FIU; the relevant person knows or believes that a matter is under investigation; or the relevant person becomes aware that a request for information or an enquiry is underway by a competent authority. e) Paragraph 34 - requires hard copy records to be capable of retrieval without undue delay if kept within the Isle of Man and available within no more than seven working days if kept outside the Isle of Man. If records are not in hard copy they must be able to be retrieved without undue delay.
Under s15 and Schedule 2 of the Financial Services Act 2008
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 44 of 129 Great Britain and Northern Ireland auditor. The provision also gives powers of entry and access, and taking possession of all such books, accounts and documents as, and for so long as, may be necessary for supervisory purposes. Similar provisions are in place under sec. 36 and Schedule 5 of the Insurance Act 2008
Under para. 2(1) of Schedule 2 of the FSA 2008, the IOMFSA may request any person whom it reasonably believes may hold information that it reasonably requires for the performance of its functions to provide that information. According to para. 2(3) if the request was made of a permitted person, former permitted person, recognised auditor or former recognised auditor, the IOMFSA may issue directions to that person to secure that effect is given to its request. If a person contravenes any direction by the IOMFSA, the Authority may undertake action for a breach. The IOMFSA is also able to compel production of information from any other person whom it has reason to believe holds relevant information when it is authorised to do so by a justice of the peace (magistrate) under para. 3. Similar powers are vested with the IOMFSA in para. 2 of Schedule 5 to the IA 2008 and sec. 15 of the DBRO Act.
Under s39 of the FSA 2008 it is stated;-
“ If a person
(a) knows or suspects that an investigation by the Authority is being or is likely to be carried out; and (b) falsifies, conceals, destroys or otherwise disposes of, or causes or permits the falsification, concealment, destruction or disposal of documents which that person knows or suspects are or would be relevant to such an investigation, that person is guilty of an offence unless it is proved that there was no intention of concealing the facts disclosed by the documents from persons carrying out such an investigation.”
Under s40 of the FSA 2008 it is stated;-
(1) A person (“A”) who - (a) furnishes or sends to the Authority for any purpose under this Act a document which A knows to be false or misleading in a material particular; or (b) recklessly furnishes or sends to the Authority for the purposes of this Act a document which is false or misleading in a material particular; or (c) in furnishing information to the Authority for the purposes of this Act - (i) makes a statement which A knows to be false or misleading in a material particular; or (ii) recklessly makes a statement which is false or misleading in a material particular, is guilty of an offence.”
Under s41(3) of the FSA 2008 the penalties are for;-
“A person guilty of an offence under any of section 36 to 39 is liable - (a) on summary conviction to a fine not exceeding £5,000 or to custody for a term not exceeding 6 months, or to both; (b) on conviction on information to a fine or to custody for a term not exceeding 5 years, or to both.”
Under s41(4) of the FSA 2008 the penalties are for;- “A person guilty of an offence under section 40 or paragraph 1(4) or 3(8) of Schedule 2 is
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 45 of 129 Great Britain and Northern Ireland liable - (a) on summary conviction to a fine not exceeding £5,000 or to custody for a term not exceeding 6 months, or to both; (b) on conviction on information to a fine or to custody for a term not exceeding 2 years, or to both.”
Under s42 of the FSA 2008 any offence committed under the FSA 2008 also applies to a body corporate.
The competent authorities conducting investigations can obtain access to all necessary documents and information for use in investigations, prosecutions, and related actions through various provisions under the Proceeds of Crime Act 2008
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 46 of 129 Great Britain and Northern Ireland 35. Paragraph 4 of article 12
4. Each State Party shall disallow the tax deductibility of expenses that constitute bribes, the latter being one of the constituent elements of the offences established in accordance with articles 15 and 16 of this Convention and, where appropriate, other expenses incurred in furtherance of corrupt conduct.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Under section 30(1) of the Income Tax Act 1970 (
“(1) No deduction shall be allowed for any purpose under the Income Tax Acts in respect of expenses incurred - (a) in making a payment if the making of the payment constitutes a criminal offence, or (b) in making a payment outside the Island if the making of a corresponding payment in the Island would constitute a criminal offence in this Island.” 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 47 of 129 Great Britain and Northern Ireland 36. Technical Assistance
The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 48 of 129 Great Britain and Northern Ireland 13. Participation of society 37. Paragraph 1 of article 13
1. Each State Party shall take appropriate measures, within its means and in accordance with fundamental principles of its domestic law, to promote the active participation of individuals and groups outside the public sector, such as civil society, non-governmental organizations and community-based organizations, in the prevention of and the fight against corruption and to raise public awareness regarding the existence, causes and gravity of and the threat posed by corruption. This participation should be strengthened by such measures as: (a) Enhancing the transparency of and promoting the contribution of the public to decision-making processes; (b) Ensuring that the public has effective access to information (c) Undertaking public information activities that contribute to non-tolerance of corruption, as well as public education programmes, including school and university curricula; (d) Respecting, promoting and protecting the freedom to seek, receive, publish and disseminate information concerning corruption. That freedom may be subject to certain restrictions, but these shall only be such as are provided for by law and are necessary: (i) For respect of the rights or reputations of others; (ii) For the protection of national security or ordre public or of public health or morals.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. In relation to Government transparency, the IOM has passed the Freedom of Information Act 2015 (
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 49 of 129 Great Britain and Northern Ireland 38. Paragraph 2 of article 13
2. Each State Party shall take appropriate measures to ensure that the relevant anti-corruption bodies referred to in this Convention are known to the public and shall provide access to such bodies, where appropriate, for the reporting, including anonymously, of any incidents that may be considered to constitute an offence established in accordance with this Convention.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The public can report knowledge or reasonable suspicions of bribery to the Isle of Man Constabulary.
Reports can be made anonymously through Isle of Man Crimestoppers:
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 50 of 129 Great Britain and Northern Ireland 39. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 51 of 129 Great Britain and Northern Ireland 14. Measures to prevent money-laundering 40. Subparagraph 1 (a) of article 14
1. Each State Party shall: (a) Institute a comprehensive domestic regulatory and supervisory regime for banks and non-bank financial institutions, including natural or legal persons that provide formal or informal services for the transmission of money or value and, where appropriate, other bodies particularly susceptible to money-laundering, within its competence, in order to deter and detect all forms of money-laundering, which regime shall emphasize requirements for customer and, where appropriate, beneficial owner identification, record-keeping and the reporting of suspicious transactions;
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The Isle of Man Financial Services Authority (IOMFSA) is the regulatory supervisory body for the entire financial sector, including the insurance and pensions sector, but excluding online gambling and casinos which are supervised by the Gambling Supervision Commission (GSC). As well as being responsible for prudential regulation they are also responsible for AML/CFT supervision. The IOMFSA’s regulatory functions and objectives are contained within the Financial Services Act 2008 which can be seen at;
The businesses in the financial sector regulated by the IOMFSA are determined by the Regulated Activities Order 2009 (as amended) which can be seen at;
The Isle of Man regulates Trust and Corporate Service Providers, Captive Insurance companies and institutions like payroll agents and virtual currency operators which are beyond those entities required to be regulated for AML/CFT purposes under the relevant international standards (FATF Recommendations). The IOMFSA also has oversight of non- financial businesses such as lawyers, accountants, tax advisors, etc. for AML/CFT purposes as per the Designated Businesses (Registration and Oversight) Act 2015 which can be seen at:
The IOMFSA has issued various policy statements, guidance including sector specific and an AML/CFT Handbook which along with relevant current legislation can be seen at:
Sector specific guidance for Money Transmission Services can be seen at:
The Isle of Man AML/CFT regime is operated on a risk based approach and a National Risk Assessment (NRA) was published in March 2016. The NRA can be seen at:
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 52 of 129 Great Britain and Northern Ireland The Isle of Man has also published its Financial Crime Strategy for 2017-2020 which sets out the government’s commitment and policy with regards combatting financial crime, especially money laundering and terrorist financing. The strategy can be seen at:
The main legislation responsible for requiring businesses to have in place AML/CFT systems and policies for customer and beneficial ownership identification, know-your- customer checks, record retention etc. are contained in the Anti-Money Laundering and Countering the Financing of Terrorism Code 2015, which can be seen at Appendix A of the IOMFSA’s AML/CFT Handbook which can be seen at;
1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. The IOMFSA and the GSC both have powers to prevent criminals and their associates from entering the market and being the beneficial owners or directors of supervised entities. The IOMFSA has prevented both legal and natural persons from entering or continuing in the market (the latter group through disqualification procedures or giving notice to an employer or prospective employer of activities or circumstances prejudicial to an individual’s fitness and propriety under regulatory legislation). The IOMFSA has received 32 applications from legal persons under the Financial Services Act 2008 between 2013 and 2015, of which nine had been discouraged from pursuing licensing due to AML/CFT concerns and withdrawn their applications (so that it was not necessary to use statutory powers).
At the request of the IOMFSA, the court has successfully disqualified persons (company officers) in 12 cases from holding corporate office (in the IoM and elsewhere) since 2008 (the most recent of which was in 2011), where in some instances previous criminal charges have been present. Other cases are currently pending. This sanction is considered when there has been general corporate misconduct and disqualification is not limited to regulated activities.
Every licensed entity is subject to regular off-site supervision. The IOMFSA policy regarding onsite visits is that, taking account of risk: (i) banks are usually visited annually or every two years; (ii) fund and investment business licence holders are visited on a one to three year cycle; (iii) in a typical year, more than 40 on-site visits to TCSPs are conducted (with an average visit cycle of between 3 and 4 years); (iv) there are frequent visits to MVTS; and (v) a series of onsite inspection visits of life assurance companies has taken place. All of these visits would have an element of AML/CFT compliance being assessed.
The following table provides information on the number of AML/CFT onsite examinations conducted by the IOMFSA in the period from 1 March 2014 to 28 February 2015.
Sector Registered Total number Number of of on-site visits AML/CFT specific on-site visits Banks 26 13 11
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 53 of 129 Great Britain and Northern Ireland Funds and investment services 88 43 4 Life assurance 15 13 13 MSBs and exchange offices 6 3 2 Trust & company services 55 7 46 providers 177
The range of sanctions available to the authorities is broad. Sanctions range from written warnings, followed by a remediation process (after an on-site visit), to withdrawal of a licence, and include fining powers. The main supervisory action used is a written warning followed by a remediation process. Action may also be taken against natural persons.
The following table sets out remedial and other regulatory actions taken under the Financial Services Act 2008 by the IOMFSA;
Financial Services Act 2008 2015 2016 Directions - under s. 14 and 18 50 - of which 18 were remedial 42 - of which FSA08 Fixed penalties relating to late filings 25 22 Section 11 - warning notices None 5 S. 23 apptmnt of reporting 3 2 accountant Section 22 - successful application to 1 1 court for for the appointment of a business manager
FSA 08 licences suspended/revoked 1 None
The number of suspicious transaction reports received by the FIU were:
STRs Filed 2013 2014 2015 Total 1,539 1,321 1,821
The number of intelligence reports related to STRs disseminated by the FIU were:
Disseminations 2013 2014 Total 789 537
The number of disseminations for investigation or other action were;
Dissemination for 2013 2014 investigation Total 230 130
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 54 of 129 Great Britain and Northern Ireland 41. Subparagraph 1 (b) of article 14
1. Each State Party shall: ... (b) Without prejudice to article 46 of this Convention, ensure that administrative, regulatory, law enforcement and other authorities dedicated to combating money-laundering (including, where appropriate under domestic law, judicial authorities) have the ability to cooperate and exchange information at the national and international levels within the conditions prescribed by its domestic law and, to that end, shall consider the establishment of a financial intelligence unit to serve as a national centre for the collection, analysis and dissemination of information regarding potential money-laundering.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Income Tax Division The IoM is a member of the Global Forum on Transparency and Exchange of Information for Tax Purposes (OECD). Global Forum members are subject to a peer review process and, following its 2011 peer review report, the IoM was one of only 22 Global Forum Members from the 94 reviewed to date to receive the top ‘compliant’ rating. The IoM is also among the first countries to implement international standards on automatic exchange of information under the EU Savings Directive FATCA and will in 2017 commence automatic exchange of information under the Common Reporting Standard. The countries with which the Isle of man has signed a Tax Information Exchange Agreement can be seen at;
Customs & Excise Division (CED) The CED cooperates closely with their UK counterparts, i.e. HMRC and the UK Border Force, especially where competences are shared, such as the import/export of potential dual-use goods, day to day customs, and excise and VAT matters. Whilst Mutual Legal Assistance requests are routed via the Attorney General’s Chambers, mutual administrative assistance in customs and indirect taxation, import and export controls and trade controls on the trafficking and brokering of weapons and other sensitive goods, as well as UN/EU sanctions, including where criminal activity might be involved, takes place with - HMRC; UK Border Force; the UK National Crime Agency; VAT and customs authorities in other EU Member States; customs attaches in London embassies and high commissions; the UK Export Control Organisation; and with the UK Foreign and Commonwealth Office and HM Treasury in respect of UN/EU sanctions. In the 5 years to 2016, the CED handled 194 mutual administrative assistance requests, with 134 dealt with by its Law Enforcement Section because of a suspicion of fiscal fraud or other illegal activity. The Law Enforcement Section also undertook 11 investigation cases which related to mutual assistance requests.
FIU The Isle of Man FIU has been a member of the Egmont Group since 2001 and exchanges information regularly with foreign counterparts. Most of the communications dealt with UK related cases and therefore the UK-FIU (NCA) is viewed as the main partner in
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 55 of 129 Great Britain and Northern Ireland exchanging financial intelligence internationally. The figures dating back to 2009 show that the FIU, on average, seeks financial information around seventy (70) times per year. Most cases where the FIU takes a pro-active approach deal with the UK. The FIU acts as a national centre in the Isle of Man for the collection, analysis and dissemination of information regarding potential money-laundering and other forms of financial crime. It can exchange information with all the relevant domestic authorities.
Financial Crime Unit (FCU)
The FCU cooperates internationally through INTERPOL and directly with its UK counterparts.
IOMFSA
The IOMFSA does not need to have a co-operation agreement in place in order to seek and provide assistance. Nevertheless, the IOMFSA has entered into many co-operation arrangements. The IOMFSA is also a full signatory to the IOSCO Multilateral Memorandum of Understanding (‘IOSCO MMOU’) under which it co-operates and exchanges information for the purposes of regulatory enforcement of securities matters. As well as detailing the type of co-operation required by signatories, the IOSCO MMOU ensures that no domestic laws or regulations can prevent securities regulators from sharing information with their counterparts in other jurisdictions.
The Isle of Man is one of 54 signatories to the IAIS MMOU which is a global framework for cooperation and information exchange between insurance supervisors. The IOMFSA has entered into 27 Co-operation Agreements under the EU’s Alternative Investment Fund Managers Directive. In addition, the IOMFSA has over 30 regulatory and supervisory MOUs. The Annual Report of the former Financial Supervision Commission for the year ended 31 March 2015 recorded that over the period of the report, the FSC sent 130 letters to other supervisors for regulatory purposes, and received 83. The IOMFSA 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, exposure to ML/FT risks and group crisis management plans. The IOMFSA is also a member of a UK based regulatory and law enforcement forum (FIN-NET) which meets every 6 weeks to discuss emerging AML/CFT, fraud and criminal trends and to consider how best to deal with them.
Attorney General’s Chambers (AGC) The AGC is the Central Authority in the IoM responsible for making and receiving Mutual Legal Assistance requests in respect of investigation and prosecution of crime, criminal asset tracing, restraint and confiscation, and civil recovery (non-conviction based confiscation). The Attorney General is assisted in dealing with incoming letters of request (“ILORs”) by a full-time qualified lawyer within AGC with the title “Legal Officer, International Cooperation”. The following table sets out the offence in relation to which ILORs have been received;
2013 2014 Money laundering (ML) 7 8 ML + Corruption 4 2 ML + Fraud 15 14 ML + Drugs 1 0 ML + Tax Evasion 0 2 ML + Organised Crime 0 0 Terrorist Financing 0 0 11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 56 of 129 Great Britain and Northern Ireland Corruption 4 3 Tax Evasion 8 5 Fraud 24 17 Drugs 4 1 Other 17 11 Total requests 84 63
The Isle of Man's Financial Intelligence Unit (FIU) was established by the Financial Intelligence Unit Act 2016.
Prior to the creation of the independent FIU it was one of the functions of the Isle of Man Constabulary Financial Crime Unit. The Isle of Man's FIU purpose is to protect the integrity of the Isle of Man's financial system and contribute to the administration of justice through its expertise in detecting financial crime, countering money laundering and the financing of terrorism.
The FIU is a full member of the Egmont Group of FIUs, and adheres to the Egmont Group Statement of Purpose and its Principles for Information Exchange between FIUs.
The FIU is supervised by the FIU Board, which is a statutory board established by the FIU Act 2016. The FIU Board is made up of the Attorney General (Chair), the Chief Constable and the Collector of Customs and Excise. The Director is delegated operational functions, acts as Accounting Officer and reports to the FIU Board. The FIU Act 2016 can be seen at:
The FIU has the ability to exchange information with all relevant Isle of Man government departments. The relevant government departments who have any involvement in AML/CFT besides the FIU are The Isle of Man Constabulary, Customs & Excise, The Isle of Man Financial Services Authority, the Gambling Supervisory Commission, the Tax Division, the Department of Home Affairs and the Cabinet Office.
1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 57 of 129 Great Britain and Northern Ireland 42. Paragraph 2 of article 14
2. States Parties shall consider implementing feasible measures to detect and monitor the movement of cash and appropriate negotiable instruments across their borders, subject to safeguards to ensure proper use of information and without impeding in any way the movement of legitimate capital. Such measures may include a requirement that individuals and businesses report the cross-border transfer of substantial quantities of cash and appropriate negotiable instruments.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The Isle of Man applies a cross-border cash declaration system. A person entering or leaving the Isle of Man and carrying, or otherwise having in their possession or control, cash with a value in excess of EUR 10,000 must declare that value to a customs officer (sec. 76C(1) of the Customs & Excise Management Act 1986 (CEMA)). A copy of CEMA can be found at:
The requirement applies to movement of cash within the Common Travel Area (the UK, Ireland, the Channel Islands and the IoM) and to or from any other place: Part VA of CEMA, sec. 76B (exporting or importing goods), 76CA (sending or receiving postal packets) and 76E (cash on ships and aircraft or in goods). Cash includes notes and coins in any currency and Bearer Negotiable Instruments as defined in the FATF Recommendations Glossary (sec. 76A(1) of CEMA). Since June 2015, it also includes stored value cards and other documents, devices, coins or tokens with a monetary value.
Information on the cash declaration system is provided on the Government website and within a public notice on the Custom & Excise Division (CED) front page (An introduction to cash entering or leaving the IoM). A further public notice (Notice 9011) and the form (Form C9011 MAN) for making the declaration are also available on the website. The form requires the declarant to provide prescribed details. The website can be found at:
The requirement applies to cash sent in the mail (including mail moving to and from the UK, which is otherwise treated as domestic) or sent or carried in cargo, by courier fast parcel service, or in any other way: sec. 76B (exporting or importing goods), 76CA (sending or receiving postal packets) and 76E (cash on ships and aircraft or in goods) of CEMA.
Customs officers may ask questions about the origin of cash and its intended use and questions designed to find out if the cash is property obtained through unlawful conduct or is intended to be used for ML or other unlawful conduct or activities related to terrorism (sec. 76F of CEMA). Questions may be asked by a customs officer not only upon the discovery of a false declaration or a failure to declare, but also whenever a person makes a truthful declaration. The officer may also require evidence in support of any information to be provided.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 58 of 129 Great Britain and Northern Ireland Persons who make a false declaration or fail to submit a declaration are liable to a custodial penalty of up to 2 years, or a fine, or both. In serious cases, the provisions of money laundering or terrorist financing legislation could be applied, with charges of Money Laundering and/or confiscation or forfeiture of the cash involved.
Customs officers may seize cash, whether or not in excess of EUR 10, 000, where: (i) a person refuses to make a declaration or disclosure to an officer; (ii) an officer reasonably believes that a declaration or disclosure is untrue in a material particular; (iii) an officer has required further evidence in support of information provided in respect of a cash movement, and this has not been provided, or does not support the information; or (iv) the officer reasonably believes that any cash is property obtained by unlawful conduct, or is intended for use in ML, other unlawful conduct, or activities related to terrorism. (Sec. 76G of the CEMA, sec. 46 to 54 of POCA). The seized cash may be detained for as long as the reasonable suspicion remains or for an initial period of 48 hours.
The CED may exchange any information in its possession with foreign authorities pursuant to sec. 174B of CEMA including information about cross-border cash declaration matters. Declarations received by the CED are passed to, and collated by, and maintained within the FIU.
In addition to those penalties contained in Part VA of CEMA set out above, the provisions of Part 4 (ML) of the Proceeds of Crime Act 2008 or sec. 10 (ML) of the Anti-Terrorism and Crime Act 2003 would also apply. These provide for a custodial sentence not exceeding 14 years or a fine, or both - on conviction. Cash which is seized under sec. 76G of CEMA includes cash being imported or exported, which the customs officer reasonably suspects is property obtained through unlawful conduct, or is intended to be used for ML or other unlawful conduct of activities or related to terrorism. This includes cash which does not exceed the declaration threshold (currently EUR 10 000) where such suspicions arise. Once seized under sec. 76G, sec. 47 to 54 of the POCA 2008 apply. Sec. 50 of POCA 2008 provides for the High Bailiff to order forfeiture of detained cash (or any part of it) if satisfied that the cash (or the part of it) is recoverable property or in intended for use by any person in unlawful conduct (conduct which is unlawful under the criminal law of the IoM or unlawful under the criminal law of another country and which would be unlawful if it occurred in the IoM). 1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. During 2016 an outgoing postal packet addressed to the UK was detained at the Sea Terminal, opened and found to contain a sum of cash liable to detention (below the €10,000 declaration threshold, but suspected of being linked to the purchase of illegal drugs). During 2015, the CED carried out 16 operations at the Sea Terminal in conjunction with the police canine unit using drugs and cash detection dogs. It also carried out 8 visits to freight haulier/courier premises, again with the police canine unit. The canine unit also carries out regular checks on domestic (UK) mail with the co-operation of the Post Office.
Outreach activities have been provided to the security personnel (private sector and government employees) who are most likely to come upon illicit cash. The staff were provided with pocket-sized cards summarising the requirements, the definition of what is regarded as being “cash”, and what to do if any suspect cash were found. As a direct result of the outreach, and following a suggestion from the private sector airport personnel, the Treasury amended the definition of “cash” in the legislation to widen it, particularly to include “stored-value cards” which had been identified as a potential risk.
The following table shows the number of cross-border cash and bearer negotiable bearer instrument declarations made; 11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 59 of 129 Great Britain and Northern Ireland Year Amount Forfeited Where Seized 2013 £16,546.00 3 x Post 2014 £29,601.88 4 x Post 2015 £24,105.02 5 x Post 2016 £1,200 + £12,000 Case pending 2 x Post
In 2015 the Isle of Man was included on the UK national committee concerned with cross- border cash declarations and seizures, so enabling it to improve connection, facilitate the flow of information, intelligence and news of new concerns, trends etc. The Isle of Man law enforcement authorities in 2017 will be given access to flight and ferry passenger lists before vessels and aircraft land or depart which will also indicate if tickets have been paid by cash. This will better aid intelligence to spot and intercept possible cash couriers.
It should be noted that all the Isle of Man air and ferry connections are all with the British Isles, and nowhere else. The Isle of Man does not have a cash based economy and its currency is not accepted/used outside of the Island. It also has the lowest crime figures within the British Isles. The banks notify the authorities when large amounts of cash are withdrawn or deposited.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 60 of 129 Great Britain and Northern Ireland 43. Paragraph 3 of article 14
3. States Parties shall consider implementing appropriate and feasible measures to require financial institutions, including money remitters:
(a) To include on forms for the electronic transfer of funds and related messages accurate and meaningful information on the originator;
(b) To maintain such information throughout the payment chain; and
(c) To apply enhanced scrutiny to transfers of funds that do not contain complete information on the originator.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The Isle of Man implements (with appropriate modifications) the requirements on wire transfers as set out in the appropriate European Union Regulations. This is done by means of orders made by the Council of Ministers, which constitutes secondary legislation in the Isle of Man. Previously Reg. (EC) 1781/2006 (EU. Reg. on wire transfers) was transposed by this means into Manx legislation. Under this EU Regulation there are stricter requirements for the information accompanying electronic transfers of funds between an EU Member State and a 3rd country or territory than for transfers between Member States or within a Member State. However, this EU Regulation permits the European Commission to authorise a Member State to conclude agreements, under national arrangements, with a country or territory which does not form part of the territory of the EU, derogating from this Regulation, in order to allow for transfers of funds between that country or territory and the Member State concerned to be treated as transfers of funds within that Member State.
The Commission may only authorise such a derogation if all of the following conditions apply: (a) the country or territory concerned shares a monetary union with the Member State concerned, forms part of the currency area of that Member State or has signed a Monetary Convention with the European Community represented by a Member State; (b) payment service providers in the country or territory concerned participate directly or indirectly in payment and settlement systems in that Member State; and (c) the country or territory concerned requires payment service providers under its jurisdiction to apply the same rules as those established under this Regulation.
In relation to the United Kingdom the Isle of Man met conditions (a) and (b) above. To comply with condition (c) above, the powers in the European Communities (Isle of Man) Act 1973 were used to make an Order to apply, with certain modifications, Regulation (EC) No 1781/2006 as part of the law of Island and then to make Regulations to implement/enforce this EU Regulation as it had effect in the Island.
Following a review of the Island’s legislation by the European Commission, the UK was authorised to conclude an agreement with the Isle of Man to allow transfers of funds between the United Kingdom and the Island to be treated as transfers of funds within the United Kingdom. Similar arrangements apply between the UK and each of the Channel
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 61 of 129 Great Britain and Northern Ireland Islands. In 2015 the European Union adopted a new Regulation following the revision of the FATF Recommendations which repealed and replaced Regulation (EC) No 1781/2006. Regulation (EU) 2015/847 of the European Parliament and of the Council of 20 May 2015 on information accompanying transfers of funds and repealing Regulation (EC) No 1781/2006, fully implements Recommendation 16 of the FATF’s revised Recommendations in the Member States of the European Union. Regulation (EU) 2015/847 applied from 26 June 2017.
From the 26 June 2017 the Isle of Man fully meets all the requirements within FATF Recommendation 16 regarding identifying the originator and beneficiary, the information being made available throughout the money transmission trail and the application of enhanced scrutiny when there is incomplete information provided.
The European Union (Information Accompanying Transfers of Funds) Order 2016 can be seen at:
1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. The IOMFSA have issued specific guidance relating to wire transfers at Appendix H of their AML/CFT Handbook. The Appendix can be seen at;
The IOMFSA have also issued specific guidance to Money Transmitters which can be seen at:
The guidance will shortly be revised to take into account the implementation of Regulation (EU) 2015/847 into Manx legislation.
Money Transmitters are a regulated financial activity in the Isle of Man and are under full regulatory supervision by the IOMFSA. They are subject to regular onsite and offsite inspections and the full remit of sanctions afforded to the regulator. Money transmitters can be seen at Class 8 in the Regulated activities Order 2009 which can be seen at:
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 62 of 129 Great Britain and Northern Ireland 44. Paragraph 4 of article 14
4. In establishing a domestic regulatory regime and supervisory regime under the terms of this article, and without prejudice to any other article of this Convention, States Parties are called upon to use as a guideline the relevant initiatives of regional, interregional and multilateral organizations against money-laundering.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The IoM Government published a formal commitment in 2012 to adopting the revised Financial Action Task Force (FATF) 40 Recommendations concerning International Standards on Combating Money Laundering and the Financing of Terrorism and Proliferation. A copy of this document can be seen at:
Furthermore, the Council of Ministers has endorsed the Isle of Man Government Anti- Money Laundering and Combating the Financing of Terrorism National Strategy 2016- 2018 based on the Isle of Man National Risk Assessment of Money Laundering and Financing of Terrorism (NRA). The NRA is currently being revised but the current version can be seen at:
The National Strategy identifies areas where the IoM Government will revise or enhance existing activities, review where new policies or guidance may be appropriate, and work with regulators and law enforcement to improve transparency. The National Strategy identifies three overarching strategic themes which underpin each of the 10 goals that make up the strategy. These themes are: 1) Monitoring and maintaining compliance with international obligations and standards and supporting measures aimed at tackling money laundering, terrorist financing and combating proliferation; 2) Ensuring that the Isle of Man Government’s national risk assessment and risk appetite for anti-money laundering and combating the financing of terrorism is adopted nationally by government, regulators and industry; 3) Raising awareness and increasing knowledge concerning the threat of terrorist financing. The National Strategy can be seen at:
The Isle of Man has undergone regular evaluations by international organisations. The most recent ones where:
The International Monetary Fund inspected the Isle of Man against the FATF Recommendations and Special recommendations in 2008 and published its report in 2009 , which can be seen at:
The International Monetary Fund carried out a Financial System Stability Assessment under its Financial Sector Assessment Program which involved looking at some aspects of implementation of FATF Recommendations and published its report in 2009 which can be seen at: 11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 63 of 129 Great Britain and Northern Ireland
The Global Forum on Transparency and Exchange of Information for Tax Purposes carried out a peer review of the Isle of Man in 2011 which encompassed a review of the regulatory aspects of the FATF Recommendations where relevant e.g. record keeping etc. Their report can be seen at: http://www.keepeek.com/Digital-Asset-Management/oecd/taxation/global-forum-on- transparency-and-exchange-of-information-for-tax-purposes-peer-reviews-isle-of-man- 2011_9789264115002-en#.WYLrYoeovcs#page9
The Global Forum on Transparency and Exchange of Information for Tax Purposes is currently undertaking a new peer review of the Isle of Man and its report is expected to be adopted at the OECD plenary scheduled to be held in Paris in October 2017.
The Isle of Man joined the FATF regional body for European jurisdictions - MONEYVAL - in October 2012 for the purpose of mutual evaluation and MONEYVAL is now responsible for evaluating the Isle of Man’s implementation of the FATF Recommendations. In 2016 it carried out its first mutual evaluation of implementation of the revised FATF Recommendations and published its report in February 2017 which can be seen at:
Other international bodies initiatives which the Isle of Man authorities takes account of when implementing its AML/CFT regime are Egmont, CARIN, IOSCO, IAIS, GIFCS, GIICS, EU Money laundering Directives and the Basle Group on Banking Supervision. Due to the close economic and political ties with the United Kingdom the Isle of Man also closely follows and sometimes mirrors UK developments e.g. the creation of a register of beneficial ownership in 2017. As a British Crown Dependency the Isle of Man is not normally empowered to sign or ratify international conventions on its own behalf, but following requests by the Isle of Man Government, the UK’s ratification of conventions can be extended to the Isle of Man. Conventions ratified by the UK extending to the Isle of Man currently include the Vienna Convention (2/12/93); Terrorist Financing Convention (25/09/08); the Merida Convention (09/11/09); OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (2001) and; the Palermo Convention (01/07/12). In February 2006, the United Kingdom ratified the United Nations Convention against Corruption and it was agreed that the Convention should be extended to the Isle of Man. The biggest single influence on the Isle of Man’s AML/CFT regime is the FATF Recommendations.
An example of using/following an international body’s guideline is that the Isle of Man used the World Bank NRA template, self-assessment tool and methodology to create its NRA. World Bank officials directly assisted in the process.
1525 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. A good measure of how well the Isle of Man has implemented the requirements of the FATF Recommendations into its legislation and general AML/CFT regime is shown by the very high marking of the MONEYVAL assessment team for Technical Compliance Rating. The Isle of Man was marked Compliant or largely compliant for all but five of the 40 FATF Recommendations. Of the five where a marking of Partially Compliant was given, the one for FATF Recommendation 16 was marked below Largely Compliant or Compliant due to a
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 64 of 129 Great Britain and Northern Ireland technicality, which has now been rectified. FATF Recommendation 16 relates to wire transfers and the negative points were due to the new FATF requirements for beneficiary details to be attached to wire transfers not being complied with. At the time of the assessment the Isle of Man could not implement these requirements due to having to mirror exactly the requirements laid down by the European Union. The EU was implementing the new requirements across its members by implementation of the 4th Money laundering Directive. All EU member states had to implement the ML Directive on 26th June 2017 and for the Isle of Man to satisfy the criteria for the EU, it had to bring in legislation which required beneficiary details to attach to wire transfers on 26 June as well. This was so the Isle of Man could operate under derogation of the EU rules as explained previously above to treat wire transfers between the UK and itself as domestic transfers. The assessors under the FATF rules could not mark Recommendation 16 highly because the assessment took place before the 26 June and only what was in place at the time of the assessment could be taken into account. Now that new legislation is in place fully complying with FATF Recommendation 16, the Isle of Man will be applying for the marking of partially compliant to be upgraded by MONEYVAL. MONERYVAL’s technical ratings for the Isle of Man implementing the individual FATF recommendations were as shown in the following table:
FATF R1 R2 R3 R4 R5 R6 R7 R8 LC C C LC LC LC LC LC R11 R12 R13 R14 R15 R16 R17 R18 LC LC C LC C PC LC LC R 21 R22 R23 R24 R25 R26 R27 R28 LC LC PC PC PC LC LC LC R31 R32 R33 R34 R35 R36 R37 R38 C LC LC LC PC LC LC LC (C = Compliant: LC = Largely Compliant: PC = Partially Compliant: NC = Non-Compliant)
Taking into account UNCAC and the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions amongst other factors in 2010 the UK brought in new legislation. The UK’s Bribery Act 2010 was at the time described as the toughest anti-corruption legislation in the world. It was the result of an amalgamation of the previous statutory and common law offences relating to bribery and corruption. The Isle of Man decided to introduce a comparable piece of legislation rather than amend the Corruption Act 2008 and brought in its own Bribery Act 2013.
Included in the provisions of the Act is a corporate offence. A relevant commercial organisation (being (1) a body incorporated in the Isle of Man (2) a partnership formed under the law of the Isle of Man (3) a body incorporated or a partnership formed elsewhere but which carries on a business (or part of a business) in the Isle of Man) (an "Organisation") is guilty of an offence if a person associated with it bribes another person with the intention of obtaining or retaining business or an advantage in the conduct of business for the Organisation. The expression "associated" person is given a wide meaning and means a person who performs services for or on behalf of someone else, determined by reference to all the relevant circumstances and not merely by the nature of the relationship between the two parties.
It is a strict liability offence and it makes no difference if the organisation had no knowledge of the bribe, where in the world the bribery takes place, nor if it occurs in a foreign jurisdiction where such behaviour constitutes accepted practice.
The offence is triable on information and punishable with an unlimited fine. The only defence available is can the organisation prove it had adequate procedures in place to
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 65 of 129 Great Britain and Northern Ireland prevent persons associated with it from committing bribery offences under the Act.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 66 of 129 Great Britain and Northern Ireland 45. Paragraph 5 of article 14 5. States Parties shall endeavour to develop and promote global, regional, subregional and bilateral cooperation among judicial, law enforcement and financial regulatory authorities in order to combat money- laundering.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The Isle of Man authorities are involved in a number of international fora. Some of the main ones are:
MONEYVAL - the IOM has had membership as a British Crown Dependency along with Guernsey and Jersey since 2012. The Isle of Man takes an active part in all MONEYVAL activities and two government officials are trained as AML/CFT assessors to carry out Mutual Evaluations of member states. One is currently involved in the MONEYVAL assessment of the AML/CFT regime of the Ukraine. The Isle of Man has provided personnel to be part of the MONEYVAL delegations to recent FATF plenaries.
Group of International Finance Centre Supervisors (GIFCS) - the Isle of Man is a long-time member of this group, participating and providing speakers to all their plenaries. For several years the CEO of the Isle of Man FSA was the Chair of this group until his retirement in 2015 (he has retained the role as Chair). The IOM was one of the contributors to the Standard on the Regulation of Trust and Corporate Service Providers which was issued by GIFCS in October 2014.
Crown Dependency Tri-party AML/CFT Meetings - Isle of Man government officials regularly attend the meetings which are chaired on a revolving basis by the Attorneys General of Jersey, Guernsey and the Isle of Man. The meetings aims are to promote better co-ordination, understanding and assistance on AML/CFT related matters between the three Islands.
FIN-NET - an IOMFSA official attends all meetings of FIN-NET which are held on a bi- monthly basis in London. FIN-NET is a UK initiative where members of the UK government, Secret Intelligence Service and law enforcement agencies meet with financial sector association representatives, selected foreign government officials and other invited bodies to share relevant financial intelligence, typologies and provide contact points on financial crime, corruption, fraud and AML/CFT issues.
Egmont - The Isle of Man FIU is a full and active member of Egmont and attends all its plenaries and other select meetings. It has been a member since 2001. The Director of the FIU is Joint-Chair of the Euro II Group of FIU’s in Egmont.
International Organisation of Securities Commissions (IOSCO) - The Isle of Man has successfully passed the vetting procedures to be a member of the IOSCO Multi- memorandum of Understanding and in the financial year 2015/16 dealt with 9 requests for information/evidence from six different IOSCO MMOU member states. The Isle of Man also posts on a regular basis public warnings on the IOSCO website. For several years until recently, members of staff from the IOMFSA have served on one of the jurisdictional vetting teams for membership of the IOSCO MMOU.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 67 of 129 Great Britain and Northern Ireland The Group of International Insurance Centre Supervisors (GIICS) - The Isle of Man’s Insurance & Pensions Authority (IPA) (who recently merged with the financial regulator to create the present IOMFSA) was a long-time member of GIICS and the CEO of the IPA was for many years its Chair. The IOMFSA has carried on the membership.
The Enlarged Contact Group on the Supervision of Collective Investment Funds - the IOMFSA is an active member of the group and has previously hosted one of its international meetings and chaired the event.
International Association of Insurance Supervisors (IAIS) - The IOMFSA is an active member of this international body and has for many years been a participant on its Multi- Memorandum of Understanding.
International Association of Gaming Regulators (IAGR) - The IOM’s Gambling Supervision Commission chairs the IAGR’s e-gambling working group which focusses on AML/CFT and in particular the sharing of AML/CFT information.
Gaming Regulators European Forum (GREF) - the IOM GSC in March 2017 at the GREF conference, presented on its approach to virtual currency gambling and it’s recently published virtual currency AML/CFT guidance. The GSC along with France will produce an “AML/CFT Benchmarking” white paper by Q2 2018. This will provide an overview of the gambling AML/CFT controls and international cooperation methods in use in IAGR and GREF member jurisdictions.
International Olympic Committee’s International Forum for Sports Integrity - GSC participates in their conferences and has contributed to an expert panel on intelligence and investigations.
C5 International Anti-Corruption Conference - in February 2017 a GSC member was a panellist discussing AML/CFT and its application in a gambling context.
Camden Assets Recovery Interagency Network - the Isle of Man is a member of CARIN.
International Anti-Money Laundering Operational Network (AMON) - The Isle of Man Constabulary is an active member of this informal network of national contacts from law enforcement anti-money laundering units. AMON’s website can be found at;
UK’s National Crime Agency - Economic Crime Command - The Isle of Man Constabulary is included in the Economic Crime Command as part of a wider MOU with the NCA. A Police representative sits on the Crown Dependencies Group which meets every 6 months. This is the IOM’s NCA portal for operational support and tasking if required through economic crime command.
Interpol - The Isle of Man Constabulary actively use Interpol. Also all outbound Letters of Requests are routinely forwarded from the AG’s Chambers to the like legal body in another jurisdiction. However, some jurisdictions like Cyprus for example will only act upon them if they are also routed through Interpol desks in London & Cyprus.
The Isle of Man also operates on a LEA to LEA basis with a number of forces but in particular the Irish Garda’s Criminal Assets Bureau (CAB); the Merseyside Criminal Assets Team; the Procurator Fiscal’s Office, Scotland; the UK’s HMRC and all the UK’s NW Regional Asset Recovery Teams.
1525 11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 68 of 129 Great Britain and Northern Ireland 1 Please provide examples of the implementation of those measures, including related court or other cases, available statistics etc. Attorney General’s Chambers - The number of International Letters of request seeking evidence and/or information is as follows:
2010 2011 2012 2013 2014 2015 Nov.) 54 80 82 84 63 50
IOMFSA - The IOMFSA does not need to have a co-operation agreement in place in order to seek and provide assistance. Nevertheless, the IOMFSA has entered into many co- operation arrangements. The IOMFSA is a full signatory to the IOSCO Multilateral Memorandum of Understanding (‘IOSCO MMOU’) under which it co-operates and exchanges information for the purposes of regulatory enforcement of securities matters. As well as detailing the type of co-operation required by signatories, the IOSCO MMOU ensures that no domestic laws or regulations can prevent securities regulators from sharing information with their counterparts in other jurisdictions.
The IoM is one of over 54 signatories to the IAIS MMOU which is a global framework for cooperation and information exchange between insurance supervisors. The IOMFSA has entered into 27 Co-operation Agreements under the EU’s Alternative Investment Fund Managers Directive. In addition, the IOMFSA has over 30 regulatory and supervisory MOUs. The Annual Report of the former FSC for the year ended 31 March 2015 recorded that over the period of the report, the FSC sent 130 letters to other supervisors for regulatory purposes, and received 83. The IOMFSA is a member of and participates in a number of supervisory colleges in respect of groups of which IoM insurers are members and liaises with supervisors in the IoM and elsewhere about matters of common interest including systemic risk, group-wide solvency, exposure to ML/FT risks and group crisis management plans.
Gambling Supervision Commission - The GSC has concluded formal information sharing agreements with the following countries: Denmark - November 2011; Malta - August 2012; Estonia - May 2013; UK - July 2013; Jersey - June 2014; Alderney - October 2014; Seychelles - April 2016. The GSC has also signed a letter of intention with the Netherlands in May 2015. The information sharing agreement with the UK is the most actively used arrangement. This is because the UK market is a large gambling market and many IoM licensees are active in that market. The GSC has also approached other gambling authorities for information sharing MOUs since 2009 and the approach has been declined by those countries.
FIU - The FIU exchanges information regularly with foreign counterparts within the Egmont Group. Since 2013 the Isle of Man has received 185 requests from Egmont and sent 18. However, most communications deal with UK related cases and therefore the UK- FIU (NCA) is the main partner in exchanging financial intelligence internationally. Dating back to 2009 the FIU, on average, sought financial information around 70 times per year and received approximately 200 requests from the UK.
Customs - customs receive and seek mutual administrative assistance with/from UK Customs; UK Border Force; the UK National Crime Agency; VAT and customs authorities in other jurisdictions; customs attaches in London embassies and high commissions; the UK Export Control Organisation; and with the UK Foreign and Commonwealth Office and HM Treasury in respect of UN/EU sanctions. In the 5 years to 2016, the CED handled 194 mutual administrative assistance requests, with 134 dealt with by its Law Enforcement Section because of a suspicion of fiscal fraud or other illegal activity. The Law Enforcement Section also undertook 11 investigation cases which related to mutual
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 69 of 129 Great Britain and Northern Ireland assistance requests.
Tax Division - The IoM is a member of the Global Forum on Transparency and Exchange of Information for Tax Purposes (OECD). Global Forum members are subject to a peer review process and, following its 2011 peer review report, the IoM is one of only 22 Global Forum Members from the 94 reviewed to date to receive the top ‘compliant’ rating. The IoM is also among the first countries to implement international standards on automatic exchange of information under the EU Savings Directive FATCA and will in 2017 commence automatic exchange of information under the Common Reporting Standard.
The Tax Division provides constructive information assistance to its overseas partners. During the period from the April 2010 to March 2015, 398 requests for information were received by the Isle of Man. No requests were declined, while 54 requests were withdrawn by the Treaty partners and 333 requests were dealt in full.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 70 of 129 Great Britain and Northern Ireland 46. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. A number of actions have been identified within the recent Mutual Evaluation undertaken by MONEYVAL. An action plan has been developed by the Isle of Man authorities and is being progressed. This is a part of the MONEYVAL follow-up process which takes place after each jurisdiction is assessed. The improvements in meeting the FATF Recommendation requirements which will flow from this follow-up process will also improve the implementation of this article.
None of the required actions require outside technical assistance and will be completed by the Isle of Man authorities themselves. The Isle of Man’s first follow-up report to MONEYVAL will be submitted in February 2018 for consideration at the MONEYVAL Plenary to be held in April 2018 in Strasbourg. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 71 of 129 Great Britain and Northern Ireland V. Asset recovery 51. General provision 225. Article 51 1. The return of assets pursuant to this chapter is a fundamental principle of this Convention, and States Parties shall afford one another the widest measure of cooperation and assistance in this regard.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1524 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention, including identifying both any legal authorities/procedures for accepting requests for asset recovery and assessing that these requests are reasonably substantiated and supplemented as well as any time frame established under domestic laws and procedures for their execution, taking into account requests received from countries with similar or different legal systems and any challenges faced in this context. The IOM has a wide range of powers to give cooperation and assistance to State Parties with regard to asset recovery. These include provisions relating to investigation, freezing and confiscation, in relation to both criminal and non-conviction based confiscation investigations and proceedings.
The provisions for the return of assets which can be attributed to corruption offences to State Parties are set out in full at Articles 54 and 55 below.
1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See below.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 72 of 129 Great Britain and Northern Ireland 226. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. Historically there have been low levels of confiscation in the Isle of Man. Systematic parallel financial investigations have not been taking place, nor has the seizing of suspected proceeds of crime been taking place soon enough, leading to a risk of asset- flight. The authorities have therefore created a new unit, the International Cooperation and Asset Recovery Team (ICART) established by HM Attorney General in December 2016. ICART brings together two key components; international cooperation which was already a well-established operation of HM Attorney General’s Chambers and a new lawyer-led Asset Recovery Unit (ARU) with dedicated financial investigators. The strategic aims of the ICART in relation to asset recovery by the ARU are to: • Prioritise identification, restraint and recovery of assets resulting from serious and organised crime, with particular focus on economic crime, both in the Isle of Man and overseas; • Pursue, through all available statutory powers, the assets of all who profit from crime wherever committed, when it is proper to do so; • Assist international law enforcement agencies by enforcing asset recovery in the IOM on their behalf and otherwise assist them when necessary; and • Improve the enforcement of domestic and international confiscation orders. ICART will work proactively with other international jurisdictions and with colleagues within the Isle of Man. Guidelines will also be issued in respect of the application of the proportionality principle both in restraint and confiscation proceedings. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 73 of 129 Great Britain and Northern Ireland 52. Prevention and detection of transfers of proceeds of crime 227. Paragraph 1 of article 52
1. Without prejudice to article 14 of this Convention, each State Party shall take such measures as may be necessary, in accordance with its domestic law, to require financial institutions within its jurisdiction to verify the identity of customers, to take reasonable steps to determine the identity of beneficial owners of funds deposited into high-value accounts and to conduct enhanced scrutiny of accounts sought or maintained by or on behalf of individuals who are, or have been, entrusted with prominent public functions and their family members and close associates. Such enhanced scrutiny shall be reasonably designed to detect suspicious transactions for the purpose of reporting to competent authorities and should not be so construed as to discourage or prohibit financial institutions from doing business with any legitimate customer.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Schedule 4 of the Proceeds of Crime Act 2008
The IOMFSA publishes guidance on the obligations placed on businesses in the regulated sector by the Island’s AML/CFT legislation. This guidance comprises the IOMFSA’s AML/CFT Handbook
Paragraphs 10, 11 and 12 of the Code deal with the requirement to verify identity, specifically paragraph 10
The requirement to take reasonable steps to identify beneficial owners of any customer of a financial institution (including banks) is found in paragraphs 10, 11 and 12 where the customer is a natural person who is not acting on behalf of another and in paragraph 13 11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 74 of 129 Great Britain and Northern Ireland
Individuals who are or have been entrusted with prominent public functions, their family members and close associates fall within the Code definition of “politically exposed person” or “PEP”. The definition is a broad one which includes domestic and foreign PEPs and can be found in the interpretation section of the Code
The meaning of “enhanced customer due diligence” can be found in the interpretation section and the specific circumstances where enhanced due diligence must be obtained is set out in paragraph 15
1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. The IOMFSA undertakes supervision of its Financial Institution licenceholders by way of regular on-site visits which include review of the institution’s compliance with the Code. Any breaches of compliance with the requirements of the Code are recorded in a visit report, a copy of which is provided to the institution. The institution is then required to enter into a programme of remediation in order to rectify any breaches within a defined timescale. Cases involving serious breaches or failure to undertake the required remediation result in the matter being referred to Enforcement Division of the IOMFSA and may involve enforcement action being taken against the institution and/or key staff of that institution. Two examples of such enforcement action are given below.
OCRA (Isle of Man) Limited was an Isle of Man licensed Trust and Corporate Service Provider.
OCRA failed to address the risks associated with the activities of its clients; this significant risk was raised by the IOMFSA following a 2010 supervisory visit. By 2013 OCRA had not concluded the 2010 mandatory remediation action to risk grade its clients to the standard required by the AML/CFT Codes and OCRA’s own documented procedures. The overall findings of the 2013 visit were that in practise the OCRA Board did not demonstrate satisfactory implementation and oversight of operational and internal controls and communications, and as such, OCRA failed to comply effectively with fundamental regulatory requirements. Specific breaches arising from the 2013 visit included significant issues in OCRA’s ability to comply effectively with the statutory requirements of AML/CFT Code including risk assessment/identification procedures/new business procedures/ongoing monitoring/politically exposed persons/ staff training. Enforcement action resulted in two individuals being prohibited and one receiving a warning notice. One of the prohibited individuals is currently appealing the IOMFSA’s decision so details cannot be provided.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 75 of 129 Great Britain and Northern Ireland The other individual’s details can be found on the ’IOMFSAs website
As a result of an investigation undertaken by the IOMFSA following a routine supervisory visit, the IOMFSA identified that Apex Fund Services (IOM) Limited had contravened a number of aspects of the Anti-Money Laundering and Countering the Financing of Terrorism Code 2015. The IOMFSA reported such contraventions to the Attorney General’s Chambers (the prosecuting authority for such matters in the Isle of Man). On 21 March 2017 Apex were convicted of 3 criminal contraventions of the Code and were fined £13,500.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 76 of 129 Great Britain and Northern Ireland 228. Subparagraph 2 (a) of article 52
2. In order to facilitate implementation of the measures provided for in paragraph 1 of this article, each State Party, in accordance with its domestic law and inspired by relevant initiatives of regional, interregional and multilateral organizations against money-laundering, shall: (a) Issue advisories regarding the types of natural or legal person to whose accounts financial institutions within its jurisdiction will be expected to apply enhanced scrutiny, the types of accounts and transactions to which to pay particular attention and appropriate account-opening, maintenance and record-keeping measures to take concerning such accounts; and
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The requirements of the Code set out in the response to paragraph 1, question 2 above should be read in conjunction with the following.
The Code sets out specific requirements as to when enhanced scrutiny should be undertaken. In essence this should be undertaken when a customer poses a higher risk of ML/TF as assessed by the customer risk assessment carried out in accordance with paragraph 7 or in the event of any unusual activity. Such enhanced scrutiny includes obtaining enhanced customer due diligence (paragraph 15
The Code requirements regarding record keeping are found at paragraph 32
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 77 of 129 Great Britain and Northern Ireland During the first half of 2017 the IOMFSA undertook 44 on-site visits to Financial Institutions and Designated Non-Financial Businesses and Professions.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 78 of 129 Great Britain and Northern Ireland 229. Subparagraph 2 (b) of article 52
2. In order to facilitate implementation of the measures provided for in paragraph 1 of this article, each State Party, in accordance with its domestic law and inspired by relevant initiatives of regional, interregional and multilateral organizations against money-laundering, shall: ... (b) Where appropriate, notify financial institutions within its jurisdiction, at the request of another State Party or on its own initiative, of the identity of particular natural or legal persons to whose accounts such institutions will be expected to apply enhanced scrutiny, in addition to those whom the financial institutions may otherwise identify.
1520 Is your country in compliance with this provision? 0 (N) No
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The IOM Government is not aware of any circumstances where financial institution would be notified by any IOM Government agency either at the request of another State or on the IOM’s own initiative of the identity of particular natural or legal persons whom the FI would be expected to apply enhanced scrutiny to.
The IOM Government understands that this provision is not about UN, EU or other sanctions which prohibit financial institutions from dealing with identified particular natural or legal persons (to which IOM financial institutions are subject to). 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. N/A
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 79 of 129 Great Britain and Northern Ireland 230. Paragraph 3 of article 52
3. In the context of paragraph 2 (a) of this article, each State Party shall implement measures to ensure that its financial institutions maintain adequate records, over an appropriate period of time, of accounts and transactions involving the persons mentioned in paragraph 1 of this article, which should, as a minimum, contain information relating to the identity of the customer as well as, as far as possible, of the beneficial owner.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The Code contains detailed provisions regarding record keeping and record retention which require Financial Institutions to maintain adequate records including those pertaining to risk assessment and ongoing monitoring and customer due diligence in respect of all their customers, not just those that are subject to enhanced scrutiny. The requirements to keep such records are found at paragraph 32
Paragraph 33
During the first half of 2017 the IOMFSA undertook 44 on-site visits to Financial Institutions and Designated Non-Financial Businesses and Professions.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 80 of 129 Great Britain and Northern Ireland 231. Paragraph 4 of article 52
4. With the aim of preventing and detecting transfers of proceeds of offences established in accordance with this Convention, each State Party shall implement appropriate and effective measures to prevent, with the help of its regulatory and oversight bodies, the establishment of banks that have no physical presence and that are not affiliated with a regulated financial group. Moreover, States Parties may consider requiring their financial institutions to refuse to enter into or continue a correspondent banking relationship with such institutions and to guard against establishing relations with foreign financial institutions that permit their accounts to be used by banks that have no physical presence and that are not affiliated with a regulated financial group.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The IOMFSA General Licensing Policy
The Interpretation section of the Code defines a “shell bank” as a bank that is incorporated in a jurisdiction in which it has no physical presence and is not affiliated with a financial services group that is subject to effective consolidated supervision - see paragraph 3
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 81 of 129 Great Britain and Northern Ireland 232. Paragraph 5 of article 52
5. Each State Party shall consider establishing, in accordance with its domestic law, effective financial disclosure systems for appropriate public officials and shall provide for appropriate sanctions for non- compliance. Each State Party shall also consider taking such measures as may be necessary to permit its competent authorities to share that information with the competent authorities in other States Parties when necessary to investigate, claim and recover proceeds of offences established in accordance with this Convention.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Under the Bribery Act 2013 it is an offence for public officials not to disclose knowledge or reasonable suspicion of bribery. The IOM Government has also adopted an Anti-Bribery Policy which links to the Act:
1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 82 of 129 Great Britain and Northern Ireland 233. Paragraph 6 of article 52
6. Each State Party shall consider taking such measures as may be necessary, in accordance with its domestic law, to require appropriate public officials having an interest in or signature or other authority over a financial account in a foreign country to report that relationship to appropriate authorities and to maintain appropriate records related to such accounts. Such measures shall also provide for appropriate sanctions for non-compliance.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The IOM has adopted and published “The Government Code” (
1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 83 of 129 Great Britain and Northern Ireland 234. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 84 of 129 Great Britain and Northern Ireland 53. Measures for direct recovery of property 235. Subparagraph (a) of article 53
Each State Party shall, in accordance with its domestic law: (a) Take such measures as may be necessary to permit another State Party to initiate civil action in its courts to establish title to or ownership of property acquired through the commission of an offence established in accordance with this Convention;
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The ability to take action for recovery of property in the Isle of Man is based upon the location (in a jurisdictional sense) of the matter at issue (e.g. the location of the property to be recovered) and not the location of the parties. A State would be in the same position as any other party wishing to commence proceedings in the IOM in that they would have to establish that the Island’s courts have the jurisdiction to decide upon the point at issue. The fact that the State is not resident or located on the Island would not be a bar to commencing action.
The only other relevant point is that a party must be a “person”. This can be a real person or a legal person (e.g. a company or other corporate body). In the case of a foreign State this may need to be established (based upon the local law of that State) if their standing as a party is challenged.
The rules of the High Court are secondary legislation made pursuant to the High Court Act 1991 (
1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. The IOM is not aware of any other states using this mechanism to recover property.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 85 of 129 Great Britain and Northern Ireland 236. Subparagraph (b) of article 53
Each State Party shall, in accordance with its domestic law: ... (b) Take such measures as may be necessary to permit its courts to order those who have committed offences established in accordance with this Convention to pay compensation or damages to another State Party that has been harmed by such offences; and
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. If a judgement has been given for those damages in another jurisdiction then the Isle of Man does have reciprocal enforcement rights to the extent set out in the Judgements (Reciprocal enforcement) (Isle of Man) Act 1968 (
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 86 of 129 Great Britain and Northern Ireland 237. Subparagraph (c) of article 53
Each State Party shall, in accordance with its domestic law: ... (c) Take such measures as may be necessary to permit its courts or competent authorities, when having to decide on confiscation, to recognize another State Party’s claim as a legitimate owner of property acquired through the commission of an offence established in accordance with this Convention.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. A State would not be precluded from bringing an action through the IOM courts for recovery of property on the basis that they are the legitimate owner of that property acquired through the commission of an offence.
To date, this situation has not arisen in the IOM courts as the Isle of Man has comprehensive mutual legal assistance legislation, which is used effectively on behalf of other states. Another State Party’s claim as a legitimate owner of such property can be recognised, and the Proceeds of Crime Act 2008 permits the Isle of Man Treasury to enter into asset sharing agreements, including agreements for the full amount recovered to be repatriated where appropriate, including cases involving corruption offences. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 87 of 129 Great Britain and Northern Ireland 238. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 88 of 129 Great Britain and Northern Ireland 54. Mechanisms for recovery of property through international cooperation in confiscation 239. Subparagraph 1 (a) of article 54
1. Each State Party, in order to provide mutual legal assistance pursuant to article 55 of this Convention with respect to property acquired through or involved in the commission of an offence established in accordance with this Convention, shall, in accordance with its domestic law: (a) Take such measures as may be necessary to permit its competent authorities to give effect to an order of confiscation issued by a court of another State Party;
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Section 66 of the Proceeds of Crime Act 2008 (“POCA”) deals with the making of a confiscation order and provides for the court to determine whether a defendant has a criminal lifestyle. If so, whether he has benefited from his general criminal conduct, and if not, whether he has benefited from his particular criminal conduct. The court then determines a recoverable amount and makes a confiscation order requiring the Defendant to pay that amount. Sections 66 - 73 of POCA contain further provisions regarding confiscation orders including determination of the recoverable amount, determination of the Defendant’s benefit and determination of the available amount. Section 215 of POCA provides for the making of secondary legislation to enable confiscation orders made outside the Island to be given effect to and enforced in the Island, and the 2009 Order came into force on 1 November 2009. For the purposes of Mutual Legal Assistance or international cooperation, the Proceeds of Crime (External Requests and Orders) Order 2009 (“POCERO”) provides for confiscation orders issued by a court outside the IOM (referred to in the legislation as “external orders”) to be registered in court here and enforced with regard to property held in the IOM and identified in a request from an overseas authority for assistance in giving effect to a confiscation order. There are a number of conditions, including that the external order was made consequent on the conviction of the person named in the order, and that the order is in force with no appeal outstanding. Provision is made for confiscation in respect of money, and property other than money. No distinction need be made between laundered property, proceeds of, or property of equivalent value, from money laundering, predicate offences (including offences established in accordance with this Convention), or terrorist financing. In most cases, the money or property in the IOM will be confiscated in partial satisfaction of a sum determined in the external order, and there is no need to show a direct link between the money or other property and the offences in question. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See table (attached).
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 89 of 129 Great Britain and Northern Ireland The regime for non-conviction based confiscation, referred to as “civil recovery”, is set out in Part 1 of POCA and can be applied in cases of mutual legal assistance requests by virtue of POCERO. To date, only two such requests have been received. A request received from England and Wales in 2015 was withdrawn as the investigation in that jurisdiction was discontinued. An earlier request, contained in a letter dated 13 November 2009, was successfully executed in 2010 and is described in the case review below.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 90 of 129 Great Britain and Northern Ireland 240. Subparagraph 1 (b) of article 54
1. Each State Party, in order to provide mutual legal assistance pursuant to article 55 of this Convention with respect to property acquired through or involved in the commission of an offence established in accordance with this Convention, shall, in accordance with its domestic law: ... (b) Take such measures as may be necessary to permit its competent authorities, where they have jurisdiction, to order the confiscation of such property of foreign origin by adjudication of an offence of money-laundering or such other offence as may be within its jurisdiction or by other procedures authorized under its domestic law; and
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. As outlined above, section 66 of the Proceeds of Crime Act 2008 (“POCA”) deals with the making of a confiscation order and provides for the court to determine whether a defendant has a criminal lifestyle. If so, whether he has benefited from his general criminal conduct, and if not, whether he has benefited from his particular criminal conduct. The court then determines a recoverable amount and makes a confiscation order requiring the Defendant to pay that amount. Sections 66 - 73 of POCA contain further provisions regarding confiscation orders including determination of the recoverable amount, determination of the Defendant’s benefit and determination of the available amount. These provisions apply in the case of property of foreign origin, and where proceeds of offences established in accordance with this convention, have been laundered in and remain in the Isle of Man. (Money laundering can be prosecuted as a stand-alone offence.) Under section 222 of POCA, sums of money confiscated may be transferred to State Parties by the Isle of Man Government Treasury.
As outlined above, it is possible for the IOM to institute criminal proceedings, confiscate domestically and then transfer whole or part of the confiscated sum to the appropriate state party. Given practical considerations such as extradition, in this jurisdiction such cases would be dealt with by way of registration of the confiscation order of a State Party and enforcement here. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 91 of 129 Great Britain and Northern Ireland 241. Subparagraph 1 (c) of article 54
1. Each State Party, in order to provide mutual legal assistance pursuant to article 55 of this Convention with respect to property acquired through or involved in the commission of an offence established in accordance with this Convention, shall, in accordance with its domestic law: ... (c) Consider taking such measures as may be necessary to allow confiscation of such property without a criminal conviction in cases in which the offender cannot be prosecuted by reason of death, flight or absence or in other appropriate cases.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Non-conviction based confiscation is referred to as “civil recovery” in the Isle of Man. Part 1 of POCA enables the Attorney General to bring proceedings for recovery of property before the High Court. Property which is, or which represents, property obtained through unlawful conduct, or which is intended to be used in unlawful conduct, can be recovered. These powers are exercisable whether or not any proceedings have been brought for an offence in connection with the property. POCERO extends these powers to cases of international cooperation, allowing for registration and enforcement of foreign non-conviction based confiscation orders. It is not necessary for criminal proceedings to have been brought in the requesting jurisdiction. To date, only one international cooperation request regarding civil recovery (received from the UK) has been executed (see case summary below), but the Attorney General’s Chambers has successfully restrained funds and sought production orders for evidence gathering under the civil provisions of POCA, POCERO and the Proceeds of Crime (External Investigations) Order 2011. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. Case Summary Civil Recovery Under the Proceeds of Crime Act 2008 Beneficial Ownership Asset Sharing Service out of the Jurisdiction
Overview
For a number of years, the Attorney General’s Chambers had been in communication with the Asset Recovery Agency in the United Kingdom (“the ARA”) (which later became the Serious Organised Crime Agency (“SOCA”)) in relation to a matter that the ARA had been pursuing, where funds of around £450,000 were held in the Isle of Man. The funds related to alleged drug trafficking by individuals who fled the UK before they could be arrested. Whilst the funds had been restrained in the Isle of Man at the request of the Crown Prosecution Service of the United Kingdom since 1993, the ARA wished for the funds to be confiscated. The ARA obtained a recovery order under sections 243 and 266 of the Proceeds of Crime Act 2002 (and Act of Parliament) in November 2006 in the UK.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 92 of 129 Great Britain and Northern Ireland It was this matter which prompted the Attorney General’s Chambers to submit a paper to the Council of Ministers for reform in this area of law, as no domestic legislation existed at the time which allowed for the enforcement in the Isle of Man of a recovery order made by the UK courts. On 22 October 2008 Part 1 of the Proceeds of Crime Act 2008 (an Act of Tynwald) relating to civil recovery came into operation, enabling enforcement of the recovery order in the Isle of Man. This was the first (and only) time the Attorney General’s Chambers had made an application for civil recovery.
Background
In 1991, officers of the Midland Regional Crime Squad Financial Investigations Unit began conducting enquiries into the financial affairs of two individuals (“the Suspects”), in relation to suspected offences under the Drug Trafficking Offences Act 1986. It was believed that the Suspects were part of a criminal organisation involved in the importation and supply of cannabis resin, which at the time was a designated Class B substance by virtue of the Misuse of Drugs Act 1976. Over the course of the investigation, a total of 1,531 kilos of resin were recovered and twelve arrests made. One of the Suspects (“Suspect 1”) was the principal in the organisation in arranging and financing the importations. Both he and his partner (“Suspect 2”) managed to avoid arrest after having been tipped off, and fled to Calais. It was unknown whether Suspect 2 was actually involved in the importation of drugs but in any event, she had been aware of and benefitted financially from Suspect 1’s misdemeanours, as well as participating in the suspected laundering. Suspect 1 had no known legitimate source of income other than being a director of a company (“the Company”), which traded in the reconditioning of second-hand television sets and videos. It appeared to be a vehicle used to launder the proceeds of drug trafficking, and the accounts showed that it was responsible for purchasing properties owned by the Suspects. Financial enquiries showed that the Company had received the sum of £15,000 from another company (“the IOM Company”), which was registered in the Isle of Man. The sum was apparently advanced in the form of a loan, although there were no indications that any repayments had been made against the loan. Following the execution of a search warrant of the Suspect’s home address in Worcestershire, it became apparent that Suspect 2 (on behalf of the Company) was intending to purchase a property in Worcestershire. Both the firm of solicitors acting on behalf of Suspect 2 and the firm acting for the vendor were subsequently served with a Production Order pursuant to section 27 of the Drug Trafficking Offences Act 1986. It also transpired that Suspect 2 had made a deposit of £20,000 in connection with the house purchase and, at the time of making the deposit, was in company with Suspect 1. The funds were transferred from a second Isle of Man registered company (“the Second IOM Company”). Both the Suspects indicated that the balance for the purchase of the property would come from the same source as the deposit. Consequently, an application was made to the High Court of England and Wales under section 8 of the Drug Trafficking Offences Act 1986 for a Restraint Order to be imposed over assets held by the Suspects in the UK. It was believed that unless the monies were restrained, attempts may have been made to remove them from the jurisdiction. Meanwhile, in the Isle of Man, following communication from the ARA, the Attorney General’s Chambers (with assistance from the Isle of Man Constabulary) made an application to the Isle of Man High Court at the request of the Crown Prosecution Service for a Production Order under section 22 of the Drug Trafficking Offences Act 1987 in respect of any accounts held in the names of the Suspects and the Second IOM Company, in addition to any other company records held by a particular corporate service provider in relation to the Second IOM Company, or any other company records connected with the Suspects. As a result of the service of the Production Order, and subsequent examination of records produced by the corporate service provider, it became apparent that the sum of
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 93 of 129 Great Britain and Northern Ireland £184,324.80 was being held on deposit by the corporate service provider in the name of the Second Isle of Man Company, which was beneficially owned by Suspect 2. Following the making of a Restraint Order by the Isle of Man High Court on 17 March 1993, the funds were consequently moved to a suspense account pending the final outcome of the criminal proceedings in the UK. An examination of the documentation produced by the corporate service provider also revealed that the monies referred to above had been transferred from an account held by Suspect 2 with a bank in the Isle of Man. This account also became subject to a Restraint Order which was made on 18 March 1993 by the Isle of Man High Court. After it was discovered in 2005 that Suspect 1 had been arrested for drugs offences in Panama and was being detained in a Panamanian prison, the ARA contacted the Attorney General’s Chambers to enquire as to whether a civil recovery order obtained in the courts of England and Wales could be enforced in the Isle of Man. The Attorney General’s Chambers determined that such an order could only be enforceable in the Isle of Man if a specific Act of Tynwald was enacted providing that such orders would be recognised and enforced in the Island. At that point in time, the Isle of Man had neither domestic civil recovery legislation in place, nor legislation for the enforcement of external civil recovery orders. Since it appeared that a trial of Suspect 1 in the UK was unlikely to be possible, the ARA still went ahead with an application for a civil recovery order under Part 5 of the UK Proceeds of Crime Act 2002 in relation to the funds held in the corporate service provider’s and Suspect 2’s accounts in the Isle of Man. An Order was subsequently granted by the High Court of England and Wales pursuant to section 266 of the UK Proceeds of Crime Act 2002 (as amended) on 27 November 2006. The Order vested the recoverable property in the Trustee for Civil Recovery (an employee of the ARA appointed by the Court to give effect to the Recovery Order).
Letter of Request
Despite the matter having been extant for quite some time, a Letter of Request in relation to the enforcement of the 2006 Civil Recovery Order was not actually received from the ARA (which had then become SOCA) until 13 November 2009. By this point, legislation had been enacted in the Island (the Proceeds of Crime (External Requests and Orders) Order 2009) which enabled the Isle of Man High Court to hear proceedings for recovery orders pursuant to the registration of an external order, and vest the recoverable property detailed in the external order, in an Isle of Man Trustee for Civil Recovery. SOCA requested the assistance of the Attorney General’s Chambers in order to bring proceedings in the Isle of Man to enforce the order and recover the property through the Island’s domestic legislation. A separate letter was received on the same date in relation to the sharing of any property recovered as a result of proceedings between SOCA and the Attorney General’s Chambers. It was agreed that 80% of all property recovered would be paid over to SOCA, and the remaining 20% would remain with Chambers. The Attorney General’s Chambers subsequently applied to the Isle of Man High Court for the original Restraint Orders that had been made in 1993 over the relevant accounts to be discharged, and a property freezing order pursuant to Article 10(1) of the Proceeds of Crime Act 2008 granted in their place. Service also proved to be an obstacle to the UK and Isle of Man authorities finally being able to conclude the case. Due to the fact that Suspect 1 was serving a prison sentence in a Panamanian jail and Suspect 2 could not be traced, an Order for service out of the jurisdiction on Suspect 1, and by an alternative method on Suspect 2 was required. This was the first such application to be made in the Island and involved the use of recently enacted primary and secondary legislation, as well as the new Rules of the High Court of Justice of the Isle of Man 2009. The application was ultimately successful and on 12 January 2011, the Attorney General’s Chambers obtained an order from the Isle of Man High Court for the enforcement of the civil recovery order that had been made by the
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 94 of 129 Great Britain and Northern Ireland English High Court in November 2006. The property recovered was divided as previously agreed between the ARA and the Attorney General’s Chambers.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 95 of 129 Great Britain and Northern Ireland 242. Subparagraph 2 (a) of article 54
2. Each State Party, in order to provide mutual legal assistance upon a request made pursuant to paragraph 2 of article 55 of this Convention, shall, in accordance with its domestic law: (a) Take such measures as may be necessary to permit its competent authorities to freeze or seize property upon a freezing or seizure order issued by a court or competent authority of a requesting State Party that provides a reasonable basis for the requested State Party to believe that there are sufficient grounds for taking such actions and that the property would eventually be subject to an order of confiscation for purposes of paragraph 1 (a) of this article;
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Part 2 of POCA provides for restraint (freezing) and confiscation in respect of all crimes (except terrorism offences which are dealt with in specific legislation). Section 97 of POCA empowers the Court of General Gaol Delivery (the higher criminal court) to make an order (a “restraint order”) prohibiting any specified person from dealing with any realisable property held by that person. The restraint order may apply to all realisable property held by a specified person, whether the property is described in the order or not. The person specified need not be the suspected offender. The restraint order may be made subject to exceptions and conditions such as allowing for reasonable living expenses and reasonable legal expenses. The Court may exercise these powers provided any of the conditions specified in section 96 are satisfied. These conditions allow a restraint order to be made once an investigation has been started rather than requiring proceedings to be instituted and require that there is reasonable cause to believe that the alleged offender has benefited from his criminal conduct. The restraint order may continue until the conclusion of the proceedings.
Section 215 of POCA provides for the making of secondary legislation to enable restraint orders made outside the Island to be enforced in the Island, or restraint orders made at the request of another jurisdiction where assets are held in the IOM. POCERO came into force on 1 November 2009. For the purposes of international cooperation, POCERO provides for restraint orders made outside the IOM to be registered in court in the IOM and enforced, or as above, for a restraint order to be made in the IOM upon receipt of a request for international cooperation from another state, with regard to property held in the IOM which is identified in a request from an overseas authority to prohibit dealing with relevant property. An application can be made either on the basis that a criminal investigation has started in the requesting country, or proceedings have been commenced there. Therefore, a restraint order may be obtained before a suspect is arrested or charged with an offence. Property is “relevant property” if there are reasonable grounds to believe that it may be needed to satisfy an external order which has been or which may be made. For the purposes of restraint, no distinction need be made between laundered property, proceeds of, or property of equivalent value, from money laundering, predicate offences or terrorist financing.
The external request (in the form of a letter of request for international cooperation) must show that there is reasonable cause to believe that the alleged offender, or defendant, 11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 96 of 129 Great Britain and Northern Ireland has benefited from their criminal conduct. Criminal conduct is conduct which constitutes an offence in the IOM or would constitute an offence in the IOM if it occurred here. (Therefore, although dual criminality is required, the conduct underlying the offence, rather than the terms in which it is expressed in the legislation of the requesting country, is considered in assessing whether that requirement is met.) 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See table attached.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 97 of 129 Great Britain and Northern Ireland 243. Subparagraph 2 (b) of article 54
2. Each State Party, in order to provide mutual legal assistance upon a request made pursuant to paragraph 2 of article 55 of this Convention, shall, in accordance with its domestic law: ... (b) Take such measures as may be necessary to permit its competent authorities to freeze or seize property upon a request that provides a reasonable basis for the requested State Party to believe that there are sufficient grounds for taking such actions and that the property would eventually be subject to an order of confiscation for purposes of paragraph 1 (a) of this article; and
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See above. A restraint order may be made upon an application of the Attorney General on behalf of a requesting State. This is not dependent upon there already being a domestic order for restraint in the requesting State. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 98 of 129 Great Britain and Northern Ireland 244. Subparagraph 2 (c) of article 54
2. Each State Party, in order to provide mutual legal assistance upon a request made pursuant to paragraph 2 of article 55 of this Convention, shall, in accordance with its domestic law: ... (c) Consider taking additional measures to permit its competent authorities to preserve property for confiscation, such as on the basis of a foreign arrest or criminal charge related to the acquisition of such property.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See above. A restraint order may be made on the basis that a criminal investigation has commenced. It is not necessary for a suspect to have been arrested or charged with an offence for a restraint order to be made (and the application for a restraint order may be made without notice to the suspect if appropriate in the circumstances.)
1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See above (statistics with regard to the basis upon which the application was made on behalf of the requesting state are not kept).
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 99 of 129 Great Britain and Northern Ireland 245. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 100 of 129 Great Britain and Northern Ireland 55. International cooperation for purposes of confiscation 246. Paragraph 1 of article 55
1. A State Party that has received a request from another State Party having jurisdiction over an offence established in accordance with this Convention for confiscation of proceeds of crime, property, equipment or other instrumentalities referred to in article 31, paragraph 1, of this Convention situated in its territory shall, to the greatest extent possible within its domestic legal system: (a) Submit the request to its competent authorities for the purpose of obtaining an order of confiscation and, if such an order is granted, give effect to it; or (b) Submit to its competent authorities, with a view to giving effect to it to the extent requested, an order of confiscation issued by a court in the territory of the requesting State Party in accordance with articles 31, paragraph 1, and 54, paragraph 1 (a), of this Convention insofar as it relates to proceeds of crime, property, equipment or other instrumentalities referred to in article 31, paragraph 1, situated in the territory of the requested State Party.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The Chambers of H.M. Attorney General for the Isle of Man (“AGC”) is the Central Authority for mutual legal assistance or international cooperation requests in the Isle of Man. Due to the size of the jurisdiction, letters of request are both received and executed by officers within AGC. Upon receipt of a letter of request for assistance in registering and enforcing an external confiscation order in the Isle of Man, the letter is allocated (usually to the Legal Officer, International Cooperation) who liaises with the requesting authority and the IOM court. The Attorney General then makes an application on behalf of the requesting state for registration, and subsequently enforcement of the external confiscation order. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 101 of 129 Great Britain and Northern Ireland 247. Paragraph 2 of article 55
2. Following a request made by another State Party having jurisdiction over an offence established in accordance with this Convention, the requested State Party shall take measures to identify, trace and freeze or seize proceeds of crime, property, equipment or other instrumentalities referred to in article 31, paragraph 1, of this Convention for the purpose of eventual confiscation to be ordered either by the requesting State Party or, pursuant to a request under paragraph 1 of this article, by the requested State Party.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The legal basis for the provision of a full range of international cooperation in the IOM is not confined to one Act, although the advent of POCA and its secondary legislation, specifically, the Proceeds of Crime (External Investigations) Order 2011 (“POCEI”) has updated and streamlined the IOM’s approach to international cooperation in criminal matters.
As well as specific international cooperation powers, domestic provisions relating to the gathering of information, witness statements and documentary evidence (including banking and fiduciary records), searches, restraint and confiscation are extended to use in executing international letters of request (“ILOR”), primarily via secondary legislation to POCA. Investigative mechanisms (for example customer information orders and account monitoring orders) can also be used in response to an ILOR.
These investigative measures are also available for use in civil recovery (non-profit based confiscation) investigations.
The following types of assistance are available: i) The production, search and seizure of information, documents or evidence (including financial, fiduciary and fiscal records) from financial institutions, or other natural or legal persons; ii) The taking of evidence and statements from persons; iii) Providing originals or copies of relevant documents and records as well as any other information and evidentiary items; iv) Effecting service of judicial documents; and v) Facilitating the voluntary appearance of persons for the purpose of providing information or testimony to a requesting country. (These elements are in accordance with Article 18 of the Palermo Convention regarding Mutual Legal Assistance.)
The most commonly used provision is section 21 Criminal Justice Act 1991, which provides for taking of evidence (including financial, fiduciary and fiscal documentation) and witness statements in response to an ILOR. Systems are in place for dealing with non-urgent requests for witness statements and documentary evidence on a rolling basis. The IOM court holds eight witness hearings per month as standard, with scope for more, held on an urgent basis if necessary. Most of the MLA provisions outlined below are well suited to use on an urgent basis when the need arises.
In addition to the more formal methods outlined below, the Central Authority for MLA in
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 102 of 129 Great Britain and Northern Ireland the Isle of Man, the Attorney General’s Chambers (“AGC”), and the International Cooperation Team at the Financial Intelligence Unit (“FIU”) provide assistance in facilitating voluntary interviews and witness statements, as well as the use of facilities at the IOM Court for witnesses to give evidence in trials in other jurisdictions via video link.
1) Service of Judicial Documents
Section 30 Criminal Justice Act 1991
Section 30 provides that in response to an ILOR, the Attorney General may arrange for service (including personal service) of a summons or other process requiring a person in the IOM to appear as defendant or attend as a witness in criminal proceedings in another country, or a document recording the decision of a criminal court in another jurisdiction. Proof of service is provided to the requesting authority.
2) Production, Search and Seizure of Information, the Taking of Evidence and Statements (Including Financial Records, and Natural & Legal Persons)
Sections 24 & 25 Criminal Justice Act 1990 - power to obtain information, search warrants and answers to questions
Section 24 confers investigatory powers, exercisable at the discretion of the Attorney General, where there is a suspected offence (wherever committed) of serious or complex fraud or a serious or complex offence under the Bribery Act 2013. A person under investigation, or any other person believed to have relevant information, may be required to produce documents and provide an explanation of them. In certain circumstances, for example where serving a notice might prejudice the investigation, a warrant may be issued to search premises and take possession of documents. (These powers can be used both for domestic investigations and in response to an ILOR.) Section 25 allows for dissemination of information obtained to authorities outside the IOM. Sections 24 & 25 are a useful tool as no application to court is required, and in most cases of serious or complex fraud there is associated money laundering. IOM case law confirms that section 24 assistance can be given in fiscal matters, (see In the Matter of Frederiksen and Seven Others MLR 1996-98 286.)
Sections 21, 21A & 22 and Schedule 2 Criminal Justice Act 1991 - power to obtain evidence, witness statements and search warrants
Section 21 provides for evidence to be received by the High Bailiff (equivalent to a stipendiary magistrate). Upon receipt of a request for assistance in obtaining evidence in the IOM in connection with a criminal investigation or proceedings in another country, the Attorney General may make an application to the High Bailiff for a witness to be summoned to give evidence. Dual criminality is not required. Section 21A makes it an offence for a financial institution to disclose that section 21 has been brought into play. Section 22 provides for search and seizure in relation to material relevant to section 21 upon an application to a Deemster (a judge in the higher court). Dual criminality is required for search and seizure under s22. Schedule 2 provides a framework for the use of section 21, dealing with securing the attendance of witnesses, the power of the High Bailiff to administer oaths, transmission of evidence and costs (stipulating that no order for costs shall be made. Schedule 2 also deals with privilege of witnesses, including inter alia provision that the witness cannot be compelled to give any evidence or information which he could not be compelled to give in criminal proceedings in the country or territory from which the request for the evidence or information has come. Supporting case law includes In the matter of the Petition of Benno Paul Hafner (judgement of 17th July 2006) - it is no abuse to seek evidence from multiple jurisdictions and the Attorney General is not required to act as a filter as to nature, breadth and time frame of questions posed
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 103 of 129 Great Britain and Northern Ireland and/or information and documents requested.
Article 14 POCEI - Production Orders
In cases of a money laundering or confiscation investigation, or a civil recovery (non- conviction based confiscation) or detained cash investigation, a Deemster (a judge in the higher court) may make an order requiring a person in possession or control of material relevant to the investigation, to produce it or give access to it within a period stated in the order. Material may be in the form of documents or articles.
Article 22 POCEI - Search and Seizure Warrants
A Deemster may issue a search and seizure warrant where a production order has not been complied with or a production order is not available. Under the warrant an authorised person can enter and search premises, and seize and retain material of value to the investigation. These provisions work in conjunction with the 2011 Order, meaning that the appropriate aspects of the primary domestic search and seizure legislation (the Police Powers and Procedures Act 1998) is extended to use in MLA requests.
Article 27 POCEI - Disclosure Orders
A Deemster may make a disclosure order authorising an appropriate officer to give notice in writing to require a person with information relevant to the investigation to: i) Answer questions; and/or ii) Provide information; and/or iii) Produce documents at once, or at a specified time and in a specified manner. It is an offence to fail to comply.
Article 33 POCEI - Customer Information Orders
A Deemster may make an order specifying that all financial institutions, particular descriptions of financial institutions or particular financial institutions must, if required by notice in writing, provide information they hold relating to a specified person. Failure to comply with the notice is an offence.
Article 40 POCEI - Account Monitoring Orders
A Deemster may make an order that a financial institution must, for the period specified in the order, provide specified information at, or by, a certain time or times.
As outlined above, the AGC is the Central Authority in the IOM for the transmission and execution of requests for international cooperation. All incoming and outgoing requests are dealt with by one full-time, legally qualified employee in the role of “Legal Officer, International Cooperation” and are prioritised in terms of urgency. There are no specific domestic provisions setting out timescales to be observed in dealing with incoming MLA requests. However, as a matter of good practice, the following standards are applied:
i) ILORs are acknowledged within 3 working days of receipt; ii) Simultaneously, a copy of the ILOR is sent to the International Cooperation Team at the FIU for preliminary investigation and, if relevant information is held, witness liaison; iii) The time taken to investigate, progress to the relevant procedural step or to get the matter before the court varies according to various factors, for example complexity, the volume of documents for the witness to collate and court availability. In non-
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 104 of 129 Great Britain and Northern Ireland urgent cases, the aim is for execution within four months of receipt.
International cooperation is available during an investigation, throughout the prosecution and in relation to post conviction proceedings, such as confiscation. For execution of the majority of requests, it is sufficient that a criminal investigation has commenced.
As the IOM’s regime is legislation based, there is no requirement for Mutual Legal Assistance treaties to be in place (although a number have been entered into by, or extended to, the IOM). Further, there is no requirement for reciprocity.
Dual criminality is required only for coercive investigative processes, such as search and seizure, and the conduct underlying the offence, rather than the terms in which it is expressed in foreign legislation, is considered in assessing whether dual criminality exists.
The IOM does not have an overarching policy or regime of banking secrecy. Witnesses from banks, TCSPs and online casinos are summoned to give evidence and witness statements on a monthly basis.
The ’Bankers Books Evidence Act 1935
“7. Judge may order inspection, etc On the application of any party to a legal proceeding a judge may order that such party be at liberty to inspect and take copies of any entries in a banker’s book for any of the purposes of such proceedings. An order under this section may be made either with or without summoning the bank or any other party, and shall be served on the bank three clear days before the same is to be obeyed, unless the judge otherwise directs.”
1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See table attached.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 105 of 129 Great Britain and Northern Ireland 248. Paragraph 3 of article 55
3. The provisions of article 46 of this Convention are applicable, mutatis mutandis, to this article. In addition to the information specified in article 46, paragraph 15, requests made pursuant to this article shall contain: (a) In the case of a request pertaining to paragraph 1 (a) of this article, a description of the property to be confiscated, including, to the extent possible, the location and, where relevant, the estimated value of the property and a statement of the facts relied upon by the requesting State Party sufficient to enable the requested State Party to seek the order under its domestic law; (b) In the case of a request pertaining to paragraph 1 (b) of this article, a legally admissible copy of an order of confiscation upon which the request is based issued by the requesting State Party, a statement of the facts and information as to the extent to which execution of the order is requested, a statement specifying the measures taken by the requesting State Party to provide adequate notification to bona fide third parties and to ensure due process and a statement that the confiscation order is final; (c) In the case of a request pertaining to paragraph 2 of this article, a statement of the facts relied upon by the requesting State Party and a description of the actions requested and, where available, a legally admissible copy of an order on which the request is based.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. If any requests are defective the IOM liaises with the requesting authority and makes every effort to ensure that a complete application can be made to the IOM court of registration and enforcement of an external confiscation order.
1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. Due to the status of the IOM as an international finance centre, many more ILORs are received than issued, and although the number of outgoing ILORs is increasing (following the establishment of a separate FIU), to date all have been requests for evidence gathering, rather than confiscation in another state.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 106 of 129 Great Britain and Northern Ireland 249. Paragraph 4 of article 55
4. The decisions or actions provided for in paragraphs 1 and 2 of this article shall be taken by the requested State Party in accordance with and subject to the provisions of its domestic law and its procedural rules or any bilateral or multilateral agreement or arrangement to which it may be bound in relation to the requesting State Party.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. All decisions and actions undertaken in response an ILOR are in accordance with provisions of the law of the IOM. See information provided elsewhere under this Article. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 107 of 129 Great Britain and Northern Ireland 250. Paragraph 5 of article 55 5. Each State Party shall furnish copies of its laws and regulations that give effect to this article and of any subsequent changes to such laws and regulations or a description thereof to the Secretary-General of the United Nations.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1527 1 Please provide a reference to the date these documents were transmitted, as well as a description of any documents not yet transmitted. The IOM is a Crown Dependency for whose international relations the UK is responsible. As such responsibility for compliance with this provision rests with the UK, although the IOM would of course cooperate with the UK in ensuring compliance.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 108 of 129 Great Britain and Northern Ireland 251. Paragraph 6 of article 55
6. If a State Party elects to make the taking of the measures referred to in paragraphs 1 and 2 of this article conditional on the existence of a relevant treaty, that State Party shall consider this Convention the necessary and sufficient treaty basis.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. This question is not applicable to the IOM. International cooperation is legislation based and not conditional upon reciprocity or the existence of treaties or other arrangements. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. N/A
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 109 of 129 Great Britain and Northern Ireland 252. Paragraph 7 of article 55
7. Cooperation under this article may also be refused or provisional measures lifted if the requested State Party does not receive sufficient and timely evidence or if the property is of a de minimis value.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Incoming ILORS are assessed on a case by case basis. As outlined above, if the ILOR contains insufficient information, or does not include relevant court orders or other documents, the Legal Officer, International Cooperation liaises with their counterpart in the central authority of the requesting state, and in most cases it is possible to clarify and complete the ILOR to the point where an application based upon it can be made to the IOM court. In some cases this is not possible, or the investigation or proceedings are discontinued in the requesting state (see above tables in relation to Article 54, which give some examples). In such cases, the requesting state is informed that the ILOR will be marked withdrawn, but that if new information or evidence can be provided in the future, a supplementary ILOR will be considered. In the IOM it is rare to receive ILORs which may be refused due to de minimis value of assets. Again, each case is considered on its own merits. No ILORs requesting confiscation have been refused for this reason. The IOM does sometimes receive ILORS requesting information in relation to very low value crimes (often credit card thefts connected with online gambling). These are referred to the FIU or Financial Crime Unit of the IOM Constabulary to be dealt with as a request for intelligence, or on a police-to-police basis. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. N/A
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 110 of 129 Great Britain and Northern Ireland 253. Paragraph 8 of article 55
8. Before lifting any provisional measure taken pursuant to this article, the requested State Party shall, wherever possible, give the requesting State Party an opportunity to present its reasons in favour of continuing the measure.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. There have been no cases where provisional measures requested have been varied or lifted other than at the request of the requesting state. In one confiscation matter ongoing at the time of writing an application has been made by the defendant for registration of the external restitution order to be reversed. This application is being opposed by the Attorney General, upon the instructions of the requesting state. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. N/A
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 111 of 129 Great Britain and Northern Ireland 254. Paragraph 9 of article 55
9. The provisions of this article shall not be construed as prejudicing the rights of bona fide third parties.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Specific provision is made in the POCA dealing with what amounts to recoverable property (in matters of civil recovery) and relevant property (in criminal confiscation). Issues such as joint ownership and tainted gifts are dealt with in the legislation, and most orders state that affected parties shall have liberty to apply to the court in respect of their rights. The rights of bona fide third parties can therefore be considered safeguarded in the domestic provisions, so that the provisions of this article are not construed as prejudicial to them. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. In the case of one request (from England and Wales) difficulties were encountered as the confiscation request referred to a matrimonial home in which young children were residing. That request was ultimately withdrawn by the requesting authority. Although this demonstrates that there can be difficulties with third party rights, it does not indicate non-compliance with the Convention provision. It is not incompatible, and it is right that the court should consider such issues on a case by case basis.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 112 of 129 Great Britain and Northern Ireland 255. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 113 of 129 Great Britain and Northern Ireland 56. Special cooperation 256. Article 56
Without prejudice to its domestic law, each State Party shall endeavour to take measures to permit it to forward, without prejudice to its own investigations, prosecutions or judicial proceedings, information on proceeds of offences established in accordance with this Convention to another State Party without prior request, when it considers that the disclosure of such information might assist the receiving State Party in initiating or carrying out investigations, prosecutions or judicial proceedings or might lead to a request by that State Party under this chapter of the Convention.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. This is the function of the FIU; please refer to information submitted in response to Article 58. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 114 of 129 Great Britain and Northern Ireland 257. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 115 of 129 Great Britain and Northern Ireland 57. Return and disposal of assets 258. Paragraph 1 of article 57
1. Property confiscated by a State Party pursuant to article 31 or 55 of this Convention shall be disposed of, including by return to its prior legitimate owners, pursuant to paragraph 3 of this article, by that State Party in accordance with the provisions of this Convention and its domestic law.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. Please refer to section 22 of POCA. The Isle of Man is able to transfer the whole or part of any confiscated property. No formal arrangements for asset sharing are in place at present, but discussions with the USA in relation to an asset sharing agreement are underway and expected to result in a formal agreement in the near future. This demonstrates that the Isle of Man is willing and able to enter into such agreements at the request of other jurisdictions. In practice, the flexibility engendered by the absence of formal arrangements can be an advantage. The Island can deal with asset repatriation and sharing on a case by case basis, taking into account all the circumstances of the particular matter. Primary among these considerations are any losses suffered by victims of the underlying crimes. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. The IOM has entered into case specific asset sharing agreements with England and Wales on a number of occasions. There has not yet been a case where victims (including the state itself) of the relevant crimes were identified.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 116 of 129 Great Britain and Northern Ireland 259. Paragraph 2 of article 57
2. Each State Party shall adopt such legislative and other measures, in accordance with the fundamental principles of its domestic law, as may be necessary to enable its competent authorities to return confiscated property, when acting on the request made by another State Party, in accordance with this Convention, taking into account the rights of bona fide third parties.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See above. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. N/A
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 117 of 129 Great Britain and Northern Ireland 260. Subparagraph 3 (a) of article 57
3. In accordance with articles 46 and 55 of this Convention and paragraphs 1 and 2 of this article, the requested State Party shall: (a) In the case of embezzlement of public funds or of laundering of embezzled public funds as referred to in articles 17 and 23 of this Convention, when confiscation was executed in accordance with article 55 and on the basis of a final judgement in the requesting State Party, a requirement that can be waived by the requested State Party, return the confiscated property to the requesting State Party;
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See above. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. N/A
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 118 of 129 Great Britain and Northern Ireland 261. Subparagraph 3 (b) of article 57
3. In accordance with articles 46 and 55 of this Convention and paragraphs 1 and 2 of this article, the requested State Party shall: ... (b) In the case of proceeds of any other offence covered by this Convention, when the confiscation was executed in accordance with article 55 of this Convention and on the basis of a final judgement in the requesting State Party, a requirement that can be waived by the requested State Party, return the confiscated property to the requesting State Party, when the requesting State Party reasonably establishes its prior ownership of such confiscated property to the requested State Party or when the requested State Party recognizes damage to the requesting State Party as a basis for returning the confiscated property;
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See above. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. N/A
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 119 of 129 Great Britain and Northern Ireland 262. Subparagraph 3 (c) of article 57
3. In accordance with articles 46 and 55 of this Convention and paragraphs 1 and 2 of this article, the requested State Party shall: ... (c) In all other cases, give priority consideration to returning confiscated property to the requesting State Party, returning such property to its prior legitimate owners or compensating the victims of the crime.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See above. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. N/A
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 120 of 129 Great Britain and Northern Ireland 263. Paragraph 4 of article 57
4. Where appropriate, unless States Parties decide otherwise, the requested State Party may deduct reasonable expenses incurred in investigations, prosecutions or judicial proceedings leading to the return or disposition of confiscated property pursuant to this article.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See above. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. N/A
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 121 of 129 Great Britain and Northern Ireland 264. Paragraph 5 of article 57
5. Where appropriate, States Parties may also give special consideration to concluding agreements or arrangements, on a case-by-case basis, for the final disposal of confiscated property.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. See above. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. N/A
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 122 of 129 Great Britain and Northern Ireland 265. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 123 of 129 Great Britain and Northern Ireland 58. Financial intelligence unit 266. Article 58
States Parties shall cooperate with one another for the purpose of preventing and combating the transfer of proceeds of offences established in accordance with this Convention and of promoting ways and means of recovering such proceeds and, to that end, shall consider establishing a financial intelligence unit to be responsible for receiving, analysing and disseminating to the competent authorities reports of suspicious financial transactions.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. The Isle of Man is in compliance with the above provision in so far as the Financial Intelligence Unit was formed and created in statute as a body corporate on by the Financial Intelligence Unit Act 2016 (
(a) in respect of assigned matters and revenue matters, the Treasury; (b) the Isle of Man Financial Services Authority; (c) the Isle of Man Gambling Supervision Commission; (d) in relation to matters of consumer protection and trading standards, the Isle of Man Office of Fair Trading; (e) any other person who is charged with the duty of investigating offences or charging offenders; and (f) any other person who is engaged outside the Island in the carrying on of activities similar to any carried on by the FIU, the police force, the Collector of Customs and Excise or a law enforcement agency mentioned in paragraphs (a) to (e);
The dissemination of information to LEAs is one of the functions of the FIU, and is set out at section 5 (1)(c) where it specifically states that the FIU will co-operate with LEAs. As well as co-operating and sharing information with domestic LEAs, the FIU also receives and disseminates information both spontaneously and upon request with international FIUs and LEAs. The Isle of Man FIU is a full member of the Egmont Group of FIUs and information is received and disseminated via the Egmont Secure Web portal.
Additionally, it is an offence under the Proceeds of Crime Act 2008 Sections 139 to 141 to launder criminal property; 11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 124 of 129 Great Britain and Northern Ireland Section 139 - Concealing, disguising, converting, transferring, removing from the jurisdiction criminal property Section 140 - Facilitating the acquisition, retention, use or control of criminal property Section 141 - Acquisition, use and possession of criminal property
Failure to report suspicions or knowledge of money laundering are offences in their own right; Section 142 - Failure to disclose knowledge or suspicion etc. of money laundering - businesses in the regulated sector Section 143 - Failure to disclose knowledge or suspicion etc. of money laundering - nominated officers in the regulated sector Section 144 - Failure to disclose knowledge or suspicion etc. of money laundering - other nominated officers
A statutory defence to the above offences for the regulated sector is available if a disclosure is made to the FIU in the prescribed form and manner; Section 155 POCA. 1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. The FIU meets on a weekly basis with the Constabulary’s Financial Crime Unit and the Attorney General’s International Co-operation and Asset Recovery Unit. At these weekly tasking and co-ordinating meetings each agency agrees the activity it will undertake in regards emerging financial crime issues and reports on outcomes of previously agreed tasking. Most emerging issues arise from Suspicious Activity Reports which have been submitted to the FIU in terms of Section 155 of POCA. The three agencies started working together at the beginning of 2017 and to date, September 2017, over £31 million has been restrained and a cash seizure made of £9522 resulting from SARs.
Additionally, the FIU regularly meets with the Isle of Man Constabulary, Isle of Man Customs & Excise, Income Tax Division, Isle of Man Financial Services Authority and the Gambling Supervision Commission and participates in the high level Joint Tasking Group process which is chaired by the Constabulary.
The FIU has signed Memorandums of Understanding with Isle of Man Customs and Excise and Isle of Man Financial Services Authority. By the end of this calendar year there will be a Memorandum of Understanding signed with Isle of Man Constabulary, Isle of Man Gambling Supervision Commission, International Co-Operation and Asset Recovery Unit and the Income Tax Division.
The FIU does not need MOUs to share information in the international arena. However, it will sign them where MOUs are required.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 125 of 129 Great Britain and Northern Ireland 267. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. Following the Isle of Man’s National Risk Assessment process and subsequent report in 2015, the FIU was created in statute and a number of areas for additional resourcing were identified in order to ensure its compliance with international standards and in particular the FATF 40 Recommendations and 11 Immediate Outcomes.
Funding was provided to support the recruitment of additional staff, training and resources over a three year period. This has resulted in the appointment of a Director and two new supervisors, three new intelligence officers, an administrative officer and an IT Lead. As a result of this, there has been a significant focus on providing internationally recognised training in the investigation of money laundering and terrorism financing.
There has also been significant investment in hardware and software to support the online reporting process, data analysis, and both operational and strategic analysis. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (OT) Others: please specify The Isle of Man Financial Intelligence Unit has actively built upon the previous relationships the FCU had with partners within both the UK and Internationally. ML training has been provided by the UK NCA and TF training by the Metropolitan Police Counter Terrorism Command.
The FIU attends meetings with the UK NCA, NTFIU, and Egmont group of FIUs and the FIU Director is presently co-chair of the Euro II group of FIUs at Egmont. 1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. An experienced member of the FIU will shortly be attending the Egmont Strategic Analysis course in order to maximise the potential of the recently purchased hardware and software. This specialist training will then be cascaded to other members of the FIU.
The FIU recognises the commonality of issues faced by the other UK Crown Dependencies of Jersey and Guernsey and regularly interacts with their counterparts. The FIU will be hosting the annual CD Tri-Islands FIU meeting later this year and Gibraltar will also be attending for the first time. Additionally, all staff members have completed the Egmont e-Learning course on Operational Analysis.
The FIU is supported in its training programme by the NCA and Metropolitan Police Service.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 126 of 129 Great Britain and Northern Ireland 59. Bilateral and multilateral agreements and arrangements 268. Article 59
States Parties shall consider concluding bilateral or multilateral agreements or arrangements to enhance the effectiveness of international cooperation undertaken pursuant to this chapter of the Convention.
1520 Is your country in compliance with this provision? 0 (Y) Yes
1522 1 Please describe (cite and summarize) the measures/steps your country has taken, if any, (or is planning to take, together with the related appropriate time frame) to ensure full compliance with this provision of the Convention. A number of bilateral mutual legal assistance treaties concluded by the UK that have been extended to the IOM: i) Spain - Agreement between the UK and Spain concerning the prevention and suppression of drug trafficking and the misuse of drugs; ii) Bahamas - Agreement between the UK and the Bahamas concerning the investigation of drug trafficking and confiscation of the proceeds of drug trafficking; iii) Saudi Arabia - Agreement between the UK and Saudi Arabia concerning the investigation of drug trafficking and confiscation of the proceeds of drug trafficking; iv) Sweden - Agreement between the UK and Sweden concerning the restraint and confiscation of proceeds of crime; v) USA - Treaty between the UK and USA on Mutual Legal Assistance in Criminal Matters Treaty Series No.14 (1997); also Agreement between the UK and the USA on Investigation of Drug Trafficking Offenses and the Seizure and Forfeiture of the Proceeds of Drug Trafficking; vi) Mexico - Agreement between the UK and Mexico concerning mutual assistance in relation to drug trafficking; also Agreement between the UK and Mexico on Mutual Assistance in the Investigation, Restraint and Confiscation of the Proceeds of Crime other than Drugs Trafficking; vii) Ukraine - Agreement between the UK and the Ukraine concerning the Restraint and Confiscation of Proceeds and Instrumentalities of Criminal Activity other than Drug Trafficking Treaty Series No.47 (1997); also Agreement between the UK and the Ukraine on Mutual Assistance in Relation to Drug Trafficking; viii) Thailand - Treaty between the UK and Thailand on Mutual Assistance in Criminal Matters; and ix) Hong Kong - Agreement between the UK and Hong Kong concerning mutual assistance in criminal matters.
The UK’s ratification of the Council of Europe’s 1959 European Convention on Mutual Legal Assistance has been extended to the IOM.
It should be noted, however, that the IOM providing legal assistance is not conditional on the existence of a bilateral or multilateral treaty between the IOM and the requesting Party.
1526 1 Please provide examples of the implementation of those measures, including related court or other cases, statistics etc. See above.
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 127 of 129 Great Britain and Northern Ireland 269. Technical Assistance The following questions on technical assistance relate to the article under review in its entirety.
1529 1 Please outline actions required to ensure or improve the implementation of the article under review and describe any specific challenges you might be facing in this respect. None. 1530 Do you require technical assistance for the implementation of this article? If so, please specify the forms of technical assistance that would be required. For example: 0 (NO) No assistance would be required
1531 1 Is any technical assistance already being provided to you? If so, please provide a general description of the nature of the assistance, including donor information. None
11/01/2018 United Kingdom of UK Crown Dependency - Isle of Man Page 128 of 129 Great Britain and Northern Ireland B. Other information B. Other information 270. Other information Please provide any other information you believe is important for the Conference of the States Parties to the United Nations Convention against Corruption to consider at this stage regarding aspects of, or difficulties in, implementing the Convention other than those mentioned above.
511 1 Please provide any other information you believe is important for the Conference of the States Parties to the United Nations Convention against Corruption to consider at this stage regarding aspects of or difficulties in implementing the Convention other than those mentioned above None.
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