By NEIL HARTNELL
Tribune Business Editor
The attorney general yesterday warned the financial services industry that The Bahamas “cannot afford to let our guard down again” on complying with international anti-financial crime standards.
Carl Bethel QC, addressing an Internet-based conference attended by more than 350 local financial services executives, said The Bahamas’ present difficulties could be traced back to its failure “to keep up to date” with the Financial Action Task Force’s (FATF) ever-evolving 40 recommendations for combating money laundering and terrorism financing.
This failure, he explained, resulted in the unfavourable 2015 evaluation by this nation’s Caribbean Financial Action Task Force (CFATF) peers. This, in turn, triggered The Bahamas’ inclusion in the FATF’s enhanced surveillance of jurisdictions deemed to have weaknesses in their anti-financial crime defences with effect from October 2018.
And, aided by the COVID-19 enforced delay to the FATF’s “site visit” to determine whether The Bahamas has successfully implemented all its legislative and regulatory overhauls, the European Commission has now placed this nation on its own “high risk” countries’ blacklist - although this will not take effect until October this year.
Mr Bethel said The Bahamas cannot continue to lag behind global standards and attempt “always just to be a little less bad than the others” as he urged it to break with past approaches. Arguing that the former Christie administration was “slow to act” in addressing the country’s anti-financial crime weaknesses, he added: “The challenges we faced in 2017 were almost unbeatable......
“What is the lesson in all of this for us as a jurisdiction? Simply that we cannot afford to let our guard down again. If we wish to remain relevant and effective, we must strive every day to stay abreast of evolving standards and expectations. It is an easy thing to slip, take the easy road and end up being listed. Experience shows that it is easy to be listed, but a far more difficult thing to repair the damage.”
Mr Bethel continued: “We must all develop a firm resolve to work assiduously, and in a mutually supportive manner. Firstly, to keep abreast of all initiatives and developments as they arise, and secondly, to seek to prepare ourselves to meet all impending challenges, even before they are made, and certainly before the world decides to impose the same.
“For far too long we have adopted a passive approach, trying to lag behind so-called ‘competitors’, and each time have felt the brunt of international disdain and criticism. We cannot continue doing the same things the same way and expect any different results than those experienced in the past......
“We should no longer settle merely for that standard of trying always just to be a little less bad than others. That is no longer an acceptable state of existence. Well, enough is no longer good enough.”
Mr Bethel argued that The Bahamas has managed to “right the ship” by enacting new laws, and strengthening its regulatory and supervisory regime. He added that it is “now poised to make that last great effort to show the effectiveness of all the efforts” made to ensure it exits the FATF process. The government is acting as if its site visit is “imminent”.
To aid this process, Mr Bethel said the Securities Commission was working with his office to finalise three Bills to regulate virtual assets and technologies, such as digital currencies, according to FATF standards.
He added that the Royal Bahamas Police Force (RBPF) had “redoubled” its efforts to investigate and prosecute financial crimes, with some 116 persons charged with such offences between 2018 and 2019. This resulted in 79 prosecutions and 46 money laundering convictions.
Mr Bethel said notices will soon be posted in the newspapers mandating that non-profit companies, whether incorporated or unincorporated, must soon register their names, purposes, principal officers and commitment to maintain proper financial records.