There are two regulatory changes that Cayman funds and their service providers should have on their radar: new requirements around independent AML audits and an increase in Registry fees.
Effective from 18 September 2026, the Cayman Islands Monetary Authority’s (CIMA) new Compliance Rule introduces clearer requirements for how regulated entities, including investment funds, should test their AML compliance programmes. Funds will need to have an independent audit of their AML programme. In simple terms, the people carrying out the audit must be independent from those responsible for running the AML programme day to day. How often an audit is needed will depend on the fund’s risk profile, size, complexity and activities, rather than following the same timetable for every fund.
CIMA has also clarified that the audit needs to consider the individual fund. Where AML functions are outsourced to an administrator or another service provider, relying only on an audit of that provider may not be enough. The fund needs to be able to show that its own AML arrangements have been appropriately reviewed.
Independent audits can be done internally for up to two consecutive audit cycles, provided the team carrying out the audit is sufficiently independent. Every third audit would then need to be carried out by an external provider.
Separately, certain Cayman Registry fees will increase from 1 January 2027. For exempted companies and partnerships, annual Registry fees will increase by US$122 across the existing capital bands.
What does this mean for Cayman funds?
The immediate priority is to make sure your fund is prepared for the new independent AML audit requirements.
This is a good opportunity to review your existing AML arrangements, understand when an audit may be required and identify any gaps before the formal audit takes place.
Our team can support Cayman funds with AML programme reviews, independent AML audits and ongoing fund services. Speak to our Cayman team to understand what the new requirements mean for your fund.