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Legislative Framework for Anti-Money Laundering and Combating the Financing of Terrorism in The Bahamas

The legislative framework for anti-money laundering (AML) and combating the financing of terrorism (CFT) in The Bahamas has undergone significant enhancements in recent years. This article highlights key enactments, regulatory efforts, and developments that have strengthened this framework.

Enactments (2019)

In 2019, several important enactments were introduced to strengthen AML/CFT regulations in The Bahamas:

  • Securities Industry (Anti-Money Laundering and Countering of Terrorism) Rules, 2019: Introduced new and enhanced AML/CFT Customer Due Diligence provisions for licensees and registrants supervised by the Securities Commission.
  • Financial Corporate Services Providers (Anti-Money Laundering and Countering of Terrorism) Rules, 2019: Introduced new and enhanced AML/CFT Customer Due Diligence provisions for financial corporate services providers (FCSPs).
  • Non-Profit Organizations Act, 2019, Non-Profit Organizations (Amendment) Act, 2019: Provided for the regulation and supervision of non-profit organizations in compliance with FATF Recommendation 8.
  • Companies (Amendment) Act, 2019: Introduced enhanced sanctions to enforce statutory requirements and obligations, and strengthened powers for the Registrar General in compliance with FATF requirements.
  • International Obligations (Economic & Ancillary Measures) Orders: Domesticated sanctions in accordance with United Nations Security Council Resolutions on terrorists and those involved in proliferation.

Enactments (2020)

In 2020, further enactments were introduced to strengthen AML/CFT regulations in The Bahamas:

  • Digital Assets and Registered Exchanges Act 2020
  • Financial and Corporate Service Providers Act, 2020
  • Financial and Corporate Providers (Anti-Money Laundering/Countering Financing of Terrorism) (Amendment) Rules 2020
  • Financial and Corporate Providers (Fees) Rules 2020
  • Financial Transaction Reporting (Amendment) Regulations, 2021
  • Insurance (Amendment) Act 2021
  • Investment Funds (Prescribed Jurisdictions) Rules 2020
  • Investment Funds (Amendment) Act, 2020
  • Investment Funds Regulations 2020
  • Securities Industry (Corporate Governance) (Amendment) Rules 2020
  • Securities Industry (Fee) Rules 2020
  • Securities Industry (Fees) (Amendment) Rules 2020
  • Register of Beneficial Ownership (Amendment) Act 2020
  • Securities Industry (Anti-Money Laundering/Countering Financing of Terrorism) (Amendment) Rules 2020

Regulatory Framework

The regulatory framework for AML/CFT in The Bahamas has been strengthened through the efforts of various regulatory bodies:

  • Revised and Enhanced Guidelines: The Central Bank of The Bahamas, the Compliance Commission of The Bahamas, the Gaming Board of The Bahamas, the Insurance Commission of The Bahamas, and the Securities Commission of The Bahamas issued revised and enhanced AML/CFT/CPF guidelines to licensees and registrants.
  • Risk Assessments: These regulatory bodies refreshed or conducted risk assessments of licensees and registrants to ensure their regulatory programs captured all emerging and current risks.
  • Risk-Based Supervisory Programs: They developed and implemented risk-based supervisory programs by the Securities Commission, the Compliance Commission, the Gaming Board, and the Central Bank (Credit Union Department).