Zealous Regulation Still 'Degrading' Experience

By Neil Hartnell

Tribune Business Editor


Financial services customer experiences are still “too degraded” by the over-zealous application of strict Know Your Customer (KYC) procedures, the Central Bank’s governor believes.

John Rolle, pictured, speaking at Friday’s launch of The Bahamas’ chapter of Association of Certified Anti-Money Laundering Specialists (ACAMS), said such qualifications and skills were necessary to ensure this nation balances compliance with global anti-financial crime standards and the correct level of customer due diligence.

“My expectation is that as the critical mass of skills in the industry increases, The Bahamas will demonstrate more in practice, and in the experience of customers, that it is applying risk-based principles which do not undermine the quality of services on supply,” Mr Rolle said.

“I believe we still have gaps in how risk-based outcomes are being achieved. The pressure persists for regulatory guidance to be overly prescriptive and check-list based, with the result that the retail customer experience is still too degraded.

“We will only arrest this trend through - in addition to all of our other interventions - strengthening competence around the application of AML/CFT (anti-money laundering/counter terror financing) safeguards. I expect that we will make more progress in this regard, thanks to AML certifications of this nature.”

Mr Rolle said he was pushing for the Central Bank to adopt his own view that money laundering reporting officers (MLROs) and compliance officers undergo a regular certification process to ensure they are properly qualified to hold their posts.

“Some of the recent initiatives of the Bahamian regulators and the Government were to identify that our compliance culture was not sufficiently risk-based,” he added. “The result was that financial inclusion and access was hindered for those on the margins of the system.

“Thanks to the provisions of the FTRA (Financial Transactions Reporting Act), the Central Bank has been able to provide guidance that streamlines KYC requirements for access to retail domestic banking services. For low-risk customers, a passport is adequate documentation in itself for account opening. In the absence of the passport, a list of other government issued identity documents are acceptable. Verification of address by proof of a utility bill has given way to establishing proof that the client can be contacted by electronic or other means.”

Mr Rolle continued: “The Central Bank of The Bahamas has also made it clear that high-risk does not mean than an extra burden should be imposed to identify oneself. Rather more due diligence should be exerted around the other dimensions of how a relationship is established and monitored.

“Also, for low-risk retail prospects, the Central Bank has gone on record to state that the potential customer does not not have to offer proof of employment in order to open a bank account.”


bogart 9 months ago

....hmmmmm....The Central Bank Governor....talking bout ...zealous Regulation Still "Degrading" Expariemce.......weeeeelll.....da Central Bank Regulator....part of the same Rules.....implemented.......banks didnt work wid finding some 42,000 Bank Account customers still couldn' t be found ....mostly on small 7 x 21 mile island and dere bank accounts wid money was declared DORMANT ACCOUNTS....and all dese peoples money passed over to the CENTRAL BANK.....hmmmmmmm.....not even though it is legal created process.to know the customer on island...thorough....now cannot be find customers to give them back dere money........ to be declared dormant .....weeeelll now "Degrading".....experiemce....opening account taking their deposit money...taking their dormant account money....now admitting it "Degrading" experience...after like dozen plus years.......!!!!!!!....if ya cant find customers wid all the required papers....den how ya expected to find then wid even less required papers....?????


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