NIA CHARLESTOWN NEVIS (APRIL 12, 2013) — Facilitator of the Nevis Financial Services Regulation and Supervision Department’s 2013 AML/CFT Awareness Seminar and Training Workshop Mr. Kem Warner, believes it would be in the interest of Regional Governments if they understood the Foreign Account Tax Compliance Act (FATCA) implemented by the United States and use it to their benefit.
Mr. Warner, who is also the Managing Director of KAW Management Services Ltd. of Antigua, a Banker, Certified Anti-Money Laundering Specialist and Certified Fraud Examiner, made the comment in response to questions posed by local journalist on the impact of FATCA on Nevis and St. Kitts and the wider Caribbean.
“It [FTCA] is coming; it is there. There’s something we can do about it but we have to be creative in terms of our thinking from heads of governments, whether it is from the St. Kitts Head to Nevis Head, to understand the importance of it and of course use that law to be beneficial to the jurisdictions and of course to the Caribbean as a whole,” he said.
According to Mr. Warner, the Legislation had far-reaching effects and he said the Nevis Financial Services Regulation and Supervision Department’s awareness seminar and training workshop was a means of sensitising the people of Nevis of the importance of the legislation, not just on Nevis and St. Kitts but in the Caribbean and the world.
“This piece of legislation has far reaching effects in terms of burdens on financial institutions to ensure they comply by US requirements.
“So the purpose really, was to pretty much sensitise them on these matters and what systems they need to put in place to identify the US clients, the US accounts and of course understanding the data challenges and complexities in terms of dealing with FATCA issues, working with the IRS or finding consultants who are capable of assisting them in doing so, so that they don’t find themselves in unnecessary cost in terms of burdening their jurisdiction and of course to a lesser extent the financial institution on a whole,” he explained.
Mr. Warner added that the legislation would have some effect on the way the jurisdictions operated and the institutions that were classified as foreign financial institutions would have to comply with FATCA requests and would have to ensure that certain requirements within the systems were changed. As such he stated that customers who dealt with the banks would have to face new data requirements, new application forms and new systems.
Notwithstanding, he was certain that once the jurisdiction was compliant and in line with international standards they would not lose business.
“At the end of the day if we do it right, the key thing is to show we are going to be compliant with international standards and of course ensuring that it does not put additional burden that would of course drive business away from this jurisdiction.
“So the key thing is to use it to your advantage because it’s not going anywhere it’s already passed. Though fundamentally, I don’t agree with all aspects of the FATCA but of course it’s there and it is our responsibility to ensure that it is actually put in place and our systems are adjusted to suit it,” he said.
The Act which was introduced by the United States Government was designed to crack down on tax avoidance by wealthy US citizens involved in the Offshore Industry. It will take effect in July 2013.