Minister says legislation not intended to probe earnings
NASSAU, BAHAMAS – Minister of State for Legal Affairs Elsworth Johnson said yesterday it is not the government’s intention to probe the balance sheets of non-profit organizations by passing the Non-Profit Organization Bill.
He said, however, the government must ensure that these entities are “fit and proper” and do not facilitate terrorism financing.
The Bahamas’ reputation depends on it, according to Johnson.
Bahamas Christian Council President Delton Fernander said this week that while he understands the need for the bill — to avoid potential sanctions from financial sector watchdogs — the requirements of the legislation are too rigid.
According to Fernander, the requirements represents an intrusion of state into the church.
“As the deputy prime minister indicated, this bill is not intended to create an incursion on the private goings on of any non-profit institution, but those institutions that registered under the Companies Act and as such, Mr. Speaker, the world has changed and we must understand that we live in a global village,” Johnson said during debate on a compendium of bills aimed at bringing the financial services sector in line with international standards.
“I know sometimes we commonly refer to 9/11 and what happened in 9/11, and we have seen a number of incidents — the Panama papers or whatever have you — where persons seek to set up organizations and their intent of the organization is diametrically opposed to what they say the organization will be doing.
“This is not an intention to see what’s on your balance sheet. This is not a witch-hunt for any particular group. This is a realization of our local and international obligations to protect The Bahamas.”
Deputy Prime Minister and Minister of Finance Peter Turnquest tabled the Non-Profit Organization Bill in the House of Assembly last Wednesday.
Parliamentarians passed the bill yesterday as part of a package of bills aimed at bringing the country’s financial services sector in compliance with OECD requirements.
The Non-Profit Organization Bill will require non-profit organizations to apply to a registrar to be added to the register.
A non-profit can be removed from the register if it fails to maintain accounting records, refuses to comply with a request given by the registrar or it fails to conduct its affairs in accordance with the legislation.
Under the bill, the registrar may require a non-profit to produce financial statements.
Failure to produce financial records could result in a fine of up to $5,000.
Additionally, the registrar will be mandated to identify cases of misconduct or mismanagement in the administration of a non-profit and refer these incidents to authorities.
Fernander expressed disappointment that the government intended to pass the legislation without consulting the clergy, noting that some churches fall under non-profit organizations.
He said when the government first advanced the bill there was some preliminary conversation, but never substantive consultation.
Yesterday, Johnson said he was a part of consultations with industry partners, including the church.
He noted that there are numerous non-profits registered locally which have never been renewed.
He stressed that the government has an obligation to the country, its citizenry and visitors to know “everybody that is in The Bahamas, when they come, and when they go”.
“Simply put Mr. Speaker, this bill, the Non-Profit Organization Bill is designed to do just that, so that 9/11 and other incidents where people set up [shell] companies will never happen again,” he said.
“But, I underscore the point that this is not a witch hunt to try and find out what someone’s closing balance is or was.”