Financial Crime World

Financial Sanctions and Embargoes in The Bahamas: Understanding the Risks and Consequences

Introduction

The Bahamian government has implemented various financial sanctions and embargoes to combat money laundering, terrorist financing, and proliferation financing. This article provides an overview of the risks and consequences associated with these regulations.

Enforcement and Penalties

The Compliance Commission of The Bahamas (CC) is responsible for overseeing compliance with financial regulations. Failure to comply can result in administrative penalties, which are monetary fines imposed by the CC without the need for legal proceedings.

Administrative Penalties

  • Maximum penalty: $200,000 on companies and $50,000 on individuals
  • Factors considered when determining the amount of the penalty:
    • Gravity and duration of the contravention or failure
    • Degree of responsibility of the financial institution or person
    • Financial strength of the financial institution or person
    • Amount of profit gained or loss avoided by the financial institution or person
    • Loss to third parties caused by the contravention
    • Level of cooperation with the Commission
    • Previous contraventions

Factors Considered for Amount of Penalty

The CC will consider the following factors when determining the amount of a penalty:

  • The gravity and duration of the contravention or failure
  • The degree of responsibility of the financial institution or person
  • The financial strength of the financial institution or person
  • The amount of profit gained or loss avoided by the financial institution or person
  • The loss to third parties caused by the contravention
  • The level of cooperation of the financial institution or person with the Commission
  • Any previous contraventions

Sanctions

The Bahamas has implemented targeted financial sanctions related to terrorism and terrorist financing, as well as proliferation financing. These sanctions include:

  • Freezing assets
  • Prohibiting transactions with designated entities

Reporting Requirements

Financial institutions in The Bahamas are required to report any assets frozen or actions taken in compliance with the prohibition requirements of relevant Security Council resolutions, including attempted transactions.

Consequences of Non-Compliance

The CC will publish the name of individuals or firms that breached obligations, the nature of the offense, and the amount of the penalty imposed.