The Law That Lingers: Revisiting Jersey's 2012 Fight Against Proliferation Financing

The Law That Lingers is the Money Laundering and Weapons Development (Directions) (Jersey) Law 2012.

• This is a Jersey statute (often abbreviated as MLWD Law or WMDJL) enacted in 2012 to combat threats related to money laundering, terrorist financing, or the development/financing of weapons of mass destruction (WMDs, e.g., nuclear, chemical, or biological programs).

Key features:

• It empowers Jersey's Minister for External Relations (formerly Chief Minister) to issue "directions" to financial services businesses (e.g., banks, investment firms like Oppenheimer's Jersey branch) operating in or from Jersey.
• Directions can require enhanced monitoring, restrictions on transactions, or reporting for specific countries, entities, or activities posing risks to Jersey's interests.
• The law aligns with international standards (e.g., FATF recommendations) and complements broader AML/CTF/CPF frameworks like the Proceeds of Crime (Jersey) Law 1999.
• It's still listed as active legislation in Jersey's AML/CFT/CPF framework as of February 2026, but its use has diminished due to newer laws (more on this below).

The law was amended in 2018 to expand its scope:

• But it hasn't been repealed. However, it operates alongside (and has been largely overshadowed by) post-Brexit sanctions regimes.

"No Active Directions Exist as of Feb 2026"

• Confirmation:
• As of February 10, 2026, there are no current or ongoing directions issued under this law. Jersey's Financial Services Commission (JFSC) and government sites do not list any active MLWD directions. The law grants powers to issue them in response to foreign threats, but none have been enacted recently.
• Why None?
• Since 2016, Jersey has shifted to more comprehensive sanctions frameworks. Specifically:
• The Sanctions and Asset-Freezing (Jersey) Law 2019 (SAFL) and the Sanctions and Asset-Freezing (Implementation of External Sanctions) (Jersey) Order 2021 (SAFO) now handle most proliferation and sanctions-related matters.
• These implement UN Security Council resolutions and UK autonomous sanctions (post-Brexit, under the UK's Sanctions and Anti-Money Laundering Act 2018).
• SAFL/SAFO cover similar ground (e.g., asset freezes, trade restrictions) but are broader and automatically align with UK/UN updates, making the 2012 law's directions mechanism redundant for most cases.
• In practice,
• If a new threat arises (e.g., from a country like North Korea or Iran in 2026), it would likely be addressed via SAFL/SAFO rather than a new MLWD direction.

Details on the Last Direction: "Iran 2015, Expired"

• What Was It?:
  • The last (and only notable) direction under this law was the Money Laundering and Weapons Development (Directions) (Iran) (Jersey) Order 2015 (MLWD Iran Order).
  • Issued in 2015, it targeted risks associated with Iran's nuclear program and required Jersey financial firms to apply enhanced scrutiny to Iran-related transactions, entities, or funds.
• Expiry: The order expired on January 14, 2016, after a one-year term (as per Article 7 of the law, directions are time-limited unless renewed). It was not renewed because:
  • On January 16, 2016, the EU lifted most nuclear-related sanctions on Iran following the Joint Comprehensive Plan of Action (JCPOA), a 2015 nuclear deal verified by the International Atomic Energy Agency (IAEA).
  • Jersey, aligning with EU/UK policy at the time, let the order lapse.
• Post-Expiry Developments:
  • Sanctions on Iran were partially reinstated in 2018 (after U.S. JCPOA withdrawal) and expanded in 2022/2024 (e.g., due to missile transfers to Russia and human rights issues).
  • However, these are now enforced via SAFL/SAFO, not the 2012 law. Note: The JCPOA itself "terminated" on October 18, 2025 (its 10-year mark), prompting further global adjustments but no revival of MLWD directions.

History

Directions Under the Money Laundering and Weapons Development (Directions) (Jersey) Law 2012

• The Money Laundering and Weapons Development (Directions) (Jersey) Law 2012 (MLWD Law) empowers Jersey's Minister for External Relations to issue targeted "directions" to financial services businesses in or from Jersey.
• These directions aim to mitigate risks from money laundering, terrorist financing, or weapons proliferation (e.g., nuclear programs) linked to foreign threats.
• However, the law's use has been limited, and as of February 10, 2026, no active directions exist.
• Since 2016, most such risks have been addressed through broader sanctions frameworks, such as the Sanctions and Asset-Freezing (Jersey) Law 2019 (SAFL) and the Sanctions and Asset-Freezing (Implementation of External Sanctions) (Jersey) Order 2021 (SAFO), which automatically implement UN and UK sanctions.

Iran-Related Directions

• Three directions were issued specifically targeting risks from Iran's nuclear and weapons development programs.
• These required Jersey financial firms (e.g., banks, investment entities) to apply enhanced due diligence, monitor transactions, and report suspicious activities involving Iranian entities or funds.
• They were time-limited and did not renew after international developments such as the 2015 Joint Comprehensive Plan of Action (JCPOA).

Here's a summary:

• Money Laundering and Weapons Development (Directions) (Iran) (Jersey) Order 2012:
• Issuance Date: April 20, 2012 (came into force immediately).
• Details: Prohibited Jersey financial institutions from participating in transactions or business relationships with Iranian banks or entities, unless licensed. It focused on preventing the use of Jersey's financial sector for money laundering or financing Iran's weapons programs.
• Expiry/Status: Expired after one year (by April 2013). Not renewed, as a follow-up order superseded it.
• Context: Issued amid UN and EU sanctions on Iran's nuclear activities.
• Money Laundering and Weapons Development (Directions) (Iran) (Jersey) Order 2013:
• Issuance Date: 2013 (exact date not specified in records, but effective shortly after the 2012 order's expiry).
• Details: Similar to the 2012 order, it emphasised protecting Jersey's financial sector from facilitating Iranian money laundering or weapons financing. It required heightened scrutiny of any Iran-linked transactions.
• Expiry/Status: Expired after one year (by 2014). Replaced by the 2015 order.
• Context: Continued response to international concerns over Iran's nuclear program.
• Money Laundering and Weapons Development (Directions) (Iran) (Jersey) Order 2015:
• Issuance Date: January 2015.
• Details: The most recent under this law mandated enhanced monitoring and restrictions on dealings with Iranian entities to counter proliferation financing risks.
• Expiry/Status: Expired on January 14, 2016. The Minister for External Relations chose not to renew it after the JCPOA took effect on January 16, 2016, which led to the lifting of many EU/UN nuclear-related sanctions on Iran.
• Context: Aligned with global efforts but lapsed due to diplomatic progress (though sanctions were later partially reinstated in 2018 and expanded in 2022/2024 for other reasons like missile transfers).

Post-2016,

• Iran-related sanctions in Jersey (e.g., asset freezes, trade restrictions) are handled via SAFL/SAFO, which mirror UN Security Council resolutions and UK measures.
• For example, as of 2026, Jersey enforces expanded EU/UK sanctions on Iran for proliferation activities, but not through MLWD directions.

North Korea-Related Directions

• None Issued:
• There have been no directions under the MLWD Law specifically for North Korea (Democratic People's Republic of Korea, DPRK).
• Current Handling:
• North Korea sanctions are managed under SAFL/SAFO, which implements comprehensive UN Security Council resolutions (e.g., UNSCR 1718 (2006), 1874 (2009), and subsequent ones up to 2026). These include asset freezes, trade bans on arms/missiles, and financial restrictions to counter the DPRK's nuclear and ballistic missile programs. Jersey firms must screen against the UK Sanctions List (UKSL) for DPRK designations. Warnings about North Korea (e.g., in JFSC guidance) focus on proliferation financing risks, but not via MLWD directions.

Other Directions?

• No

Conclusion

• Beyond the Iran orders, no other directions have been issued under this law for any countries, entities, or threats (e.g., Syria, Russia, or general WMD proliferation).
• The JFSC and Jersey Law databases list only the Iran-related examples as historical.
• The law remains in force but is rarely used, as SAFL/SAFO provide a more efficient, automatic mechanism for aligning with international sanctions.