Offshore Financial Centres-
IMF Assessment

The International Monetary Fund (IMF) is in the process of conducting an assessment of offshore financial centres, including The Bahamas. The IMF has indicated that the process will be flexible, depending on the financial services provided in each jurisdiction and on the nature of the risks and vulnerabilities. Focussing on banking, insurance and securities “to help identify vulnerabilities in the financial system”, the assessments will be cooperative. That is, the IMF will ensure that OFCs have greater ownership, and part of its strategy will include a self-assessment provided by each nation.

According to recent statements by Mr. Eduardo Aninat, Deputy Managing Director and Acting Chairman of the IMF, statistics relating to offshore centres often are inadequate for monitoring and analysis. Directors of the IMF have agreed that, in cooperation with the jurisdictions concerned and other international fora, it should intensify efforts to develop more comprehensive coverage. The IMF will continue to play an active role, working closely with others in providing technical assistance to those centres that are working to upgrade their supervisory laws, structures and practices.

Referring to the “lists” recently published by other fora, Mr. Aninat indicated that many IMF Directors have expressed concern that these were not based upon well-developed criteria, and nor did they take into account all the relevant facts. IMF Directors have noted, further, that only limited evidence is available thus far on the direct risks posed by offshore financial vehicles for the global financial system. With specific regard to the FATF’s anti-money laundering campaign, Mr. Aninat reported that some IMF Directors have called for increased cooperation with the OECD affiliate to help prepare reports on whether nations meet international standards.