The Bahamas Is Ranked Among Those Jurisdictions Taking Impressive Strides With Regard to Counter-Money Laundering Regimes

The Financial Action Task Force on Money Laundering (FATF), an independent international body, met in Paris 31 January-2 February, to discuss current money laundering methods. It also released its latest report, outlining current trends and emerging threats such as on-line banking and internet casinos; the use of trusts, other non-corporate vehicles to launder money; lawyers, notaries, accountants and other professionals; the role of cash vs other payment methods in money laundering schemes; and terrorist-related money laundering. The report also provided a progress report on steps taken by countries previously identified as non-cooperative in the fight against money laundering (NCCTs).

During the latter half of 2000, The Bahamas took immediate steps to address concerns raised in various supranational initiatives, including that of the FATF. This response was defined recently by Prime Minister H.A. Ingraham “as a thorough and exhaustive review of existing legislation, policies, procedures, and practices, with ongoing necessary adjustments”. He further added that these substantial and far-reaching changes to the delivery of international financial services – crafted to strengthen the financial services sector and to protect it from abuse – were essential to the continuation of The Bahamas as an international financial center of significance in the world. With particular regard to the anti-money laundering programmes of the FATF, The Bahamas shares the objectives and aspires to be at the forefront of OFCs in the fight against money laundering.

At the conclusion of its Paris meeting, the Financial Action Task Force indicated that several NCCTs have made significant progress, taking impressive strides towards improving their counter-money laundering regimes. This progress is reflected in legislation introduced into various parliamentary bodies as well as enacted legislation and regulations. The Bahamas was included in a list of seven jurisdictions, which “have enacted most, if not all legislation needed to remedy the deficiencies identified in June 2000”. Specifically referenced was the package of 9 new financial services industry legislation and the relevant regulations entered into force on December 29, 2000.

The FATF has described enactment of necessary legislation and the promulgation of associated regulations as essential and fundamental first steps for jurisdictions on the list, with indication that these jurisdictions will be invited to submit their plans for implementing changes. To this end, the FATF further elaborated a process by which jurisdictions can be delisted at the earliest possible time.

In Paris, FATF members also reaffirmed their desire to continue the dialogue with the identified jurisdictions in co-operation with FATF-style regional bodies, and indicated continued willingness to provide technical assistance as appropriate for the design and implementation of anti-money laundering systems within the jurisdictions.

At its earlier Plenary Meeting (October, 2000), the FATF had advised that it would be assessing the progress made by these jurisdictions over the coming months, and that in making these assessments it would have to be satisfied as to the existence of comprehensive and effective anti-money laundering systems. At that time, it had been reported that the FATF would rely on its collective judgment, attaching particular importance to reforms in the area of criminal law, financial supervision, customer identification, suspicious activity reporting, and international co-operation. In addition, the FATF warned that it would seek to ensure that jurisdictions were implementing the necessary reforms. “Thus, information related to institutional arrangements, as well as the filing of suspicious activity reports, examinations of financial institutions, and the conduct of money laundering investigations, will be considered”, according to the news release from that Plenary.

The FATF comprises members from twenty-nine countries and governments and two international organisations. At its 20-22 June 2001 Plenary, the FATF proposes to reach a decision with respect to counter-measures for those jurisdictions, earlier identified as NCCTs, which have not made adequate progress. At the June Plenary, the FATF will also consider the assessments of a second set of jurisdictions currently being reviewed.