Cayman Islands — Country Risk Report

Cayman Islands (Offshore / IFC • British Overseas Territory). Risk report as of the 19 Jun 2026 FATF plenary.

Moderate country risk, with elevated corruption risk. Cayman Islands's country risk score is 3.9/10, placing it in the moderate-risk band. The principal driver is weak corruption. Cayman Islands is not currently FATF grey- or black-listed. Cayman Islands is not subject to comprehensive country-wide sanctions. Firms should apply additional scrutiny where exposure involves state-linked entities, restricted sectors, sensitive technology, dual-use goods or politically exposed counterparties.

Recommended treatment

Standard due diligence, with enhanced checks for defined risk triggers.

At a glance

  • FATF status: Not currently listed (one indicator only; it does not set the overall country risk rating by itself)
  • Comprehensive country sanctions: none identified. Targeted sanctions exposure: possible, screen applicable persons, entities and sectors
  • Government effectiveness and rule of law: 2.6/10
  • Corruption (CPI): no score
  • Enforcement data: not yet assessed (no RegActions coverage)

Country Risk Score: 3.9/10 (Moderate)

Higher score means higher country risk (global average 4.6). Full information available. Some evidence is older. Enforcement activity and CPI are shown for context but do not change the score.

All three parts of the score are available.

How this score was calculated

  • Financial crime controls: 6.2/10 — 50% of this score
  • Government effectiveness and rule of law: 2.6/10 — 30% of this score
  • International sanctions: 0.0/10 — 20% of this score
  • The FATF assessment is more than five years old.

International sanctions contributes 0.0 because the complete UN, UK, EU and US review found no direct country-level sanctions programme. People or organisations connected to the country may still appear on sanctions lists.

Show the exact calculation

aml 6.2 × 50% + governance 2.6 × 30% + sanctions 0 × 20% = 3.9; final 3.9

Principal risk drivers

  • Government effectiveness and rule of law drive the score; no FATF listing or direct country-level sanctions were identified

Mitigating factors

  • Not currently on the FATF grey or black list.
  • No comprehensive country-wide sanctions programme.
  • Comparatively stronger political stability (0.9/10).
  • Risk is concentrated in specific counterparties, sectors and transactions rather than applying uniformly.

Business impact

  • Customer onboarding (Medium): Additional ownership and control verification may be required.
  • Payments and transactions (Medium): Review transaction purpose, counterparties and geographic routing.
  • Trade and export activity (Medium): Screen goods, end users and potential dual-use exposure.
  • Corporate clients (Medium): Assess state ownership, government links and political exposure.
  • Ongoing monitoring (Medium): Apply alerts for ownership changes, sanctions and geopolitical developments.

Recommended controls

  • Verify ultimate beneficial ownership using more than one reliable source.
  • Identify state ownership, government influence and politically exposed persons.
  • Screen entities, directors and beneficial owners against applicable sanctions lists.
  • Apply enhanced review to technology, defence, telecommunications, financial services and dual-use activity.
  • Document transaction purpose and source of funds where cross-border structures are complex.
  • Escalate unresolved ownership opacity or adverse information to Compliance.

Enhanced due diligence triggers

  • State ownership / control
  • PEP involvement
  • Sensitive / restricted sectors
  • Opaque ownership
  • Adverse media
  • Dual-use goods & technology
  • High-risk intermediary routing

FATF status: Not currently listed

Cayman Islands is not on the FATF grey or black list as of the 19 Jun 2026 plenary.

Source details

International sanctions by issuing body

  • UN: No
  • EU: No
  • UK: No
  • US: No

No means the complete UN, UK, EU and US review found no direct country-level programme. People or organisations may still appear on sanctions lists.

Government effectiveness and rule of law (World Bank 2024, percentile)

  • Government Effectiveness: 74/100
  • Regulatory Quality: 72/100
  • Rule of Law: 71/100

Regulators and legal framework

FATF network

FATF network via CFATF.

Last mutual evaluation: 2019 · report

National regulators

Regulator profiles not yet available on RegActions.

FIU: Egmont Group member (FRA)

Framework signals

  • FATF listing: Not currently listed
  • International sanctions: no listed programme identified
  • BO register: Restricted (live since 2017)
  • Corruption (CPI): no score
  • Rule of law (WGI): 2.8/10 risk

Sector exposure

  • Banking & payments (Low): No FATF listing, rule-of-law governance within normal range
  • Trade & export controls (Low): No sanctions programme or FATF black-list constraint identified
  • Crypto & virtual assets (Low): No FATF listing, accountability governance within normal range
  • Real estate & luxury assets (Low): Corruption indicators within normal range for high-value assets
  • State-linked & procurement (Low): Political-stability and corruption governance within normal range

Derived from sanctions tier, FATF listing, World Bank WGI governance and CPI; no per-sector dataset is asserted.

Cayman Islands: analysis

The Cayman Islands' governance is shaped by a corruption domain risk, the most elevated of the four dimensions, reflecting the inherent complexity of overseeing a large, internationally oriented financial sector. Rule of law and institutions (strong) and voice and accountability (strong) are materially stronger, and political stability is very low. The jurisdiction carries no FATF listing or sanctions overlay. No CPI data are available for comparison.

Outlook

The Cayman Islands' risk trajectory is stable. Its status as a British Overseas Territory with an independent regulator provides structural governance anchors, and it sits in the upper tier of the World Bank governance indicators. Firms should monitor any developments ahead of the next FATF plenary in October 2026 and track whether the corruption domain improves as global scrutiny of offshore centres intensifies.

Key watchpoints

  • Corruption domain risk (moderate) remains the single weakest governance dimension; monitor regulatory updates on beneficial ownership transparency.
  • FATF plenary scheduled for October 2026 could alter listing status; firms should track outcomes.
  • High volume of fund structures and special purpose vehicles warrants robust counterparty due diligence on Cayman-domiciled entities.
  • Absence of CPI data limits independent corruption benchmarking; rely on WGI-based governance signals.

Assessment currency

  • FATF status: Not listed (as of 19 Jun 2026)
  • Sanctions exposure: None identified (as of Jul 2026)
  • Governance (WGI): Latest dataset incorporated (as of 2024)
  • Corruption (CPI): Not available (as of 2025)
  • RegActions assessment: Reviewed (as of 19 Jun 2026)

Public evidence layer

FATF action: none. No FATF call-for-action or increased-monitoring status was identified at the latest plenary. This does not establish low risk.

Contextual signals (not scored)

  • FATF network membership: FATF regional network: CFATF (present, as of 2026-07)
  • EU non-cooperative tax jurisdictions: Not listed in Annex I (absent, as of 2026-02-17)
  • Egmont Group FIU: FRA (present, as of 2026-07-17)
  • Beneficial-ownership register: Restricted (live since 2017) (present, as of 2026-07-17)
  • Transparency International CPI: No CPI result available (unavailable, as of 2025)

Evidence freshness

  • FATF monitored-jurisdiction status: current; data 2026-06-19
  • FATF mutual evaluation and follow-up ratings: current; data 2026-07-31; follow-up 2021-10; base assessment 2019-03
  • World Bank governance indicators: current; data 2024
  • UN, UK, EU and US sanctions regimes: current; data 2026-08-13

Contextual signals are public evidence only and do not change the immutable v2 score.

Download evidence PDF · CSV · JSON

Regional peer scores

FAQ

Is Cayman Islands on the FATF grey list?

No. Cayman Islands is not on the FATF grey or black list as of the 19 Jun 2026 plenary. FATF listing is one AML indicator; absence from the list does not by itself make Cayman Islands low risk. The next FATF plenary review is scheduled for Oct 2026.

Is Cayman Islands subject to sanctions?

No country-level programme was identified. In the approved RegActions snapshot, no comprehensive or targeted country-wide sanctions programme was found for Cayman Islands, but individual listed persons may still exist, so firms should continue to screen counterparties against the applicable lists.

What is Cayman Islands's country risk rating?

RegActions rates Cayman Islands at 3.9/10 (Moderate risk), where a higher score means higher country risk. The score combines financial crime controls, government effectiveness and rule of law, and international sanctions.

What due diligence applies to Cayman Islands?

Standard due diligence, with enhanced checks for defined risk triggers. This is decision-support based on Cayman Islands's FATF status, governance and sanctions signals, and is not a substitute for a firm's own risk assessment.

Source: FATF black & grey lists · World Bank WGI (CC BY 4.0 — World Bank WGI) · TI CPI (CC BY-ND 4.0 — Transparency International, display only)