Jersey AML Consultation Closes on MLCO and CDD Reliance Reforms

The Jersey Financial Services Commission’s consultation on proposed changes to the island’s anti-money laundering Handbook closes at 5:00pm on 18 August 2026. The consultation focuses on two areas: the money laundering compliance officer (MLCO) framework and the rules governing reliance on other obliged persons for customer due diligence.

The proposals are intended to reflect recent amendments to the Money Laundering (Jersey) Order 2008 and form part of Jersey’s Financial Services Competitiveness Programme, a joint initiative involving the Government of Jersey, the JFSC and Jersey Finance. The stated objective is to make elements of the regime more flexible and proportionate while maintaining safeguards against money laundering, terrorist financing and proliferation financing.

Changes proposed for the MLCO framework

Under the consultation, firms that decide to operate without appointing an MLCO would face clearer requirements around how that decision is made and documented. The JFSC is also proposing guidance to help firms assess whether an MLCO remains necessary in their circumstances.

The proposed guidance also addresses situations where an appointed MLCO is supported by other appropriately skilled persons, including group-level or external specialists. This is relevant to firms that distribute compliance responsibilities across wider group structures or use specialist external resources while retaining local accountability.

Reliance on third parties for customer due diligence

The second part of the consultation concerns Jersey’s reliance framework for CDD. One proposed change would remove existing obligations and guidance on mandatory testing and replace them with a more risk-based requirement for firms to evidence that they have taken adequate steps to satisfy themselves that identity evidence can be obtained from the relied-on obliged person when required.

The JFSC is also proposing updated guidance on written assurances and on the ongoing assessment of reliance arrangements. Firms would need to consider whether it remains appropriate to continue relying on an obliged person for other customer relationships after a particular reliance relationship has ended.

The consultation contains 14 questions across the two regimes. Respondents are asked to indicate whether they support, support with concerns, or do not support each proposal and to explain their reasoning. The JFSC has said it will review responses, consider whether changes are required and publish a final Handbook update with industry notice before implementation.

For compliance teams, the proposals are important because they move parts of Jersey’s AML framework away from prescriptive process requirements and toward documented risk-based judgement. That may reduce unnecessary operational burden, but it also places greater emphasis on firms being able to evidence why their MLCO and CDD-reliance arrangements remain appropriate.