Jamaica, first Caribbean country to sign FX Global Code

BY ABBION ROBINSON
Business reporter
robinsona@jamaicaobserver

Friday, August 09, 2019

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JAMAICA is the only Caribbean country to sign on to the Bank of International Settlements' Foreign Exchange Global Code of Conduct, according to the president of the Cambio Association of Jamaica (CAJ), Heather Ferguson Fearon.

Ferguson Fearon told reporters and editors at this week's Jamaica Observer Monday Exchange that all 54 cambio operators have signed the code which mandates them to observe the principles of global best practices in the foreign exchange market.

“[Bank of Jamaica, local cambios and commercial bankers] arrived at a code of conduct that we would be able to not just say we have signed on to, but [able to] practice and demonstrate to the various stakeholders that, yes, we mean business and this is how we will be operating our businesses to internationally best practice standards,” she said at the newspaper's headquarters in St Andrew.

While Jamaica may be the first country in the region to sign and observe the code designed to reform and modernise the local foreign exchange market, Ferguson Fearon said not all 55 principles of the code are applicable to Jamaica's market.

“Some of these principles would not be functional or practical as our market is not that developed; those are principles that we have signed on to but the code is proportional so it applies to interims of [a] business, in terms of the business model and type and what may be applicable to [the business],” she stated.

“This global code has been some time coming; we had two years in which to educate our cambio operators and also have their input.”

She added that when this was explained to cambio operators, “there was really no concern, so to speak”.

According to Ferguson Fearon, the signing of the Foreign Exchange (FX) Global Code is not mandatory, but she advises that it is in cambio operators' best interests to sign and adhere to the principles of the code to protect their companys' reputations.

“We're moving away from the big stick where 'this is what it is and if you do not do this, these are the implications' to a different approach where if you want to do business in the FX market in Jamaica or to be looked at by your counter parties internationally as someone who practices integrity in terms of governance structure, training and settlements then it behoves you to not only sign on to the code but practice it,” she said.

“It's not just enforcement from a regulatory standpoint but in terms of keeping your business viable.”

Ferguson Fearon added that while Jamaica had already implemented some of the business practices and regulatory frameworks outlined in the code, CAJ will have a compliance officer, whose directive will be to invigilate the conduct of cambios to effectively employ measures to mitigate money laundering and the financing of terrorism.

She also indicated that it is compulsory for cambio operators and their staff to complete at least two training programs each year.

According to the executive director of Jamaica Institute of Financial Services (JIFS), Darlene Jones, JIFS, the training arm of the financial services sector, now offers the global code certification, which is widely recognised and based on the various principles that falls under the code such as ethics, governance, execution, and settlement.

In addition, JIFS also provides annual anti-money laundering training to ensure that the financial services sector is fully compliant.

“In terms of the FX Global Code, we want to ensure that it's not just about the signing, it's to ensure the working knowledge of the code,” she added at the Monday Exchange.


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