The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bank of The Bahamas’ managing director yesterday asserted it is “absolutely not” correct to accuse the commercial banking industry of seeking to “exclude” non-profit groups and charities from the financial system.

Kenrick Brathwaite pushed back against allegations by Human Rights Bahamas that Bahamian commercial banks are forcing non-governmental organisations (NGOs) to “jump through unending bureaucratic hoops and climb mountains of red tape” to open bank accounts and, in some cases, close existing facilities without warning.

“Absolutely not,” he told Tribune Business in response to the accusations. “Why would the banks do that?” Mr Brathwaite said problems may arise if non-profits do not have their certificate of registration issued by the Registrar General’s Department, which is required before a bank account can be opened in their name.

“This goes back a couple of years ago,” the Bank of The Bahamas chief added. “The position was that all non-profits ought to have a certificate of registration, and if they didn’t have that certificate of registration, the Government gave the banks instructions to close the account. They rescinded that, withdrew the instructions to close the account, but insisted that if it was a new non-profit it needs to be registered.

“You cannot just operate a non-profit. We had a lot of discussions at the banking level when this was first introduced. A lot of instructions from government were adjusted and revisited, and that made it a lot easier to do business, especially for those already in the bank.”

Mr Brathwaite responded after Human Rights Bahamas issued a statement blasting the commercial banking sector for constantly placing roadblocks and obstacles in the way of non-profits, although it did not cite any names or specific cases. 

“It has come to the attention of Human Rights Bahamas (HRB) that several non-profit organisations and charities operating in The Bahamas have been severely handicapped by an inability to open bank accounts. They report being obstructed and impeded for months and sometimes years, made to jump through unending bureaucratic hoops and climb mountains of red tape,” the statement asserted.

“In fact, all banks in The Bahamas seem to have taken an unofficial decision to hinder and exclude non-profits across the board.” The advocacy group added that “in some cases [they are] actually closing the accounts of charities without explanation”, labelling the three Canadian-owned banks - Royal Bank of Canada (RBC), CIBC FirstCaribbean and Scotiabank - as the worst offenders.

When asked to provide names and specific examples of non-profits that have suffered bank account closures and denials, a Human Rights Bahamas spokesperson said they had been asked to issue the statement on behalf of two or three groups that wished to remain anonymous.

Suggesting that some were involved in helping victims of sexual crimes, they added that the commercial banks were “going way over and above” what is required under the law and by Know Your Customer (KYC) due diligence requirements. “They want to ignore this sector, don’t want to deal with it and are making people jump through ridiculous hoops,” they added. “One of them had their bank account closed, another couldn’t get one opened.”

Human Rights Bahamas’ statement added: “The victims of this policy are hard-working, caring Bahamians who strive every day to improve the lives of others, care for children and the elderly, help the victims of sexual assault, protect the environment and secure a fairer and more transparent political and social system to the benefit of all Bahamians. They are being systematically disenfranchised - unable to do their work, raise funds or pay staff.

“Most NGOs are funded by generous supporters of their particular cause, and the vast majority of donors require the recipient organisation to have a working bank account. Because of the obstruction by banks, many groups are now being threatened with closure, and other much-needed, socially important efforts are unable to even get off the ground. Worst of all, young Bahamian students abroad who wish to work in this field are being discouraged from returning home.

“Some of the NGOs in question stand in the gap in areas where government does not have the capacity to address fundamental needs of the public. The attitude of the banks is therefore putting more pressure on social services and other public institutions,” the statement continued.

“Of course, as private commercial entities, the banks can choose to do business with whomever they like. However, when an entire sector of the population is unfairly targeted and disadvantaged because of who they are and what they do, it amounts to discrimination, pure and simple.

“We call upon the Government of The Bahamas to urgently look into the treatment of local non-profits and charities by the commercial banking sector. Human Rights Bahamas would be happy to put investigators in touch with the victims of this unspoken exclusionary policy.”