Turnquest: Govt. to strengthen enforcement mechanisms following FATF rating

Turnquest: Govt. to strengthen enforcement mechanisms following FATF rating
Deputy Prime Minister and Minister of Finance, Peter Turnquest.

After the Financial Action Task Force (FATF) rated the Bahamas’ money laundering regime as having “strategic deficiencies” that pose a risk to the international financial system, Finance Minister Peter Turnquest said the Government has plans to strengthen its enforcement mechanisms.

The move, he said, will ensure that The Bahamas demonstrates to the world that it is a well-regulated jurisdiction.

The FATF, following its recent plenary last month listed The Bahamas as one of 11 jurisdictions with strategic Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) deficiencies, which labels The Bahamas as a jurisdiction that may pose a risk to the international financial system.

The Paris-based body said while situations differ among each jurisdiction, The Bahamas has provided a written high-level political commitment to address their identified deficiencies, and has made a high-level political commitment to work with the FATF and CFATF to strengthen the effectiveness of its Anti-Money Laundering and Combating the Financing of Terrorism regime. The FATF said the Bahamas will also address any related technical deficiencies.

“The Bahamas will work to implement its action plan to accomplish these objectives,” the FATF said, which includes: Developing and implementing a comprehensive electronic case management system for international cooperation; demonstrating risk-based supervision of non-bank financial institutions; ensuring the timely access to adequate, accurate and current basic and beneficial ownership information; increasing the quality of the  Financial Intelligence Unit’s (FIU’s) products; demonstrating that authorities are investigating and prosecuting all types of money laundering and demonstrating that confiscation proceedings are initiated and concluded.

But despite the Bahamas’ efforts to address its deficiencies as it relates to Anti-Money Laundering and Combating the Financing of Terrorism, some countries such as the United Kingdom has placed The Bahamas on its money laundering watch list, following the recent recommendations of the international Financial Action Task Force.

Following this latest rating by the FATF, the Finance Minister said that he understands the challenges that presently exists. He explained that the FATF wants to ensure that the Bahamas actually closes its loops as it relates to completing financial investigations, and either taking those investigations that are credible to prosecution or otherwise disposing them and documenting how such cases are being disposed.

“We are in the process of strengthening the FIU, we will ensure that they receive  the additional training that they need, and we are looking at potentially strengthening the Unit structurally to bring into the unit itself the investigative resources that it needs in order to ensure that it controls the investigation process and is able to produce the kind of documentation and reports that are necessary, and to recommend prosecution where there is a need for prosecution,” Turnquest said.

Mr. Turnquest did state, however, that he feels that The Bahamas is being “singled out” and he is not comfortable that the Bahamas was placed on this list, especially with countries whose financial systems are not comparable to the Bahamas.

“But we do recognize also that we are the first to be subject to this particular peer review, and so I am sure there are others that will be added to this list…so we will continue to do what we have to do to strengthen our enforcement mechanisms, and to ensure that we continue to demonstrate to the world that this is a well-regulated jurisdiction and we are practicing global best practices here in The Bahamas,” Turnquest said.

Other countries who were recently named by the FATF to have “strategic deficiencies” that pose a risk to the international financial system include: Botswana, Ethiopia, Ghana, Pakistan, Serbia, Sri Lanka, Syria, Trinidad and Tobago, Tunisia and Yemen.

The FATF and the FATF-style regional bodies outlined on its site that it will continue to work with these jurisdictions to report on the progress made in addressing the identified deficiencies.

“The FATF calls on these jurisdictions to complete the implementation of action plans expeditiously and within the proposed timeframes. The FATF will closely monitor the implementation of these action plans and encourages its members to consider the information presented below,” the body outlined on its site.