Like most of its island nation peers, the Cayman Islands Monetary Authority is focused on the promotion of the jurisdiction as an international financial hub. The Authority also aims to draw business to the Islands from various financial operators peddling money services, banking services, securities, investment funds and insurance-related operations.
While – from the perspective of the online FX/CFD industry – CIMA is not considered to be a regulatory authority in the same “weight class” as the FCA or Australia’s ASIC, its regulatory services are used by scores of brokerages.
What exactly does the CIMA do though, in addition to the above said?
As far as banks and banking services are concerned, it regulates money transfer operations, check cashing, currency exchanges, travelers checks, money orders etc. Credit unions also fall under this regulatory category.
Fiduciary services are also subject to CIMA regulation. In this category, trust service providers, trust companies and company managers need to be mentioned.
The securities investment category covers the vertical most relevant for those offering (and making use of) online FX/CFD trading services.
Brokerages, broker-dealers, market makers and securities advisors all fall into this category.
CIMA was established by the Monetary Authority Law, in January 1997. Since then, in addition to its regulatory duties, it has kept an eye on the Islands’ monetary stability, by expertly managing the currency reserves of the country, and it has upheld strict regulatory standards in regards to supervision of the above mentioned activities.
The Authority was born from the merger of two organizations, whose responsibilities it effectively inherited. These organizations were the Cayman Islands Currency Board and the Financial Services Supervision Department of the Cayman Islands.
The official website of the Authority is quick to point out though that the purpose of CIMA is not merely to continue with the practices of the aforementioned two organizations, but rather to enhance them and thus to create a stable and attractive financial environment on the Islands.
The Authority achieved operational independence in 2003. The above said Monetary Authority Law transferred the powers to issue and to revoke licenses and to actually enforce regulation to CIMA, from the Government of the Cayman Islands.
In addition to its duties tied directly to regulation and enforcement, CIMA is also the source of a number of interesting publications. These publications include an Annual Report regarding its activity, banking statistics, investment statistics, a quarterly newsletter and a Supervisory Information Circular.
In addition to these, the Authority has also released a survey about Hedge Fund Corporate Governance on the islands.
The official website of the Authority also offers a downloadable handbook about the full regulatory procedures it observes, as well as its enforcement procedures.
The laws and regulations which shape and govern the functioning of the CIMA are numerous. The official site features a page where all the relevant laws can be accessed, in alphabetical order. The centerpiece here is obviously the above mentioned Monetary Authority Law, the 2018 version of which is available on the said page too.
Below is a list of brokers that are CIMA regulated
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