Financial Crime World

Title: Bahrain Cracks Down on Financial Crime: New Penalties and Regulations

Background

Bahrain, a tiny island kingdom in the Persian Gulf, is bolstering its stance against money laundering and terrorism financing with new amendments to its Money Laundering and Terrorism Funding Law. This article explores the upcoming changes that could significantly impact the enforcement culture in regulated sectors.

AML Regulations in Bahrain

Bahrain’s commitment to maintaining high international standards in anti-money laundering (AML) regulations is evident from its latest efforts to reform its legislation. A successful business facilitation drive has driven the need for stricter AML regulations, leading to the approval of Royal Decree No. 29 of 2020.

New Administrative Penalty

The most noteworthy change for Bahraini businesses is the introduction of a new administrative penalty. Companies found negligent in implementing AML compliance measures could face fines of up to 50,000 Bahraini dinars per violation. This penalty can be multiplied for each infraction, leading to substantial fines for the most negligent entities.

Recent Enforcement Actions

Bahrain’s authorities have demonstrated a growing intolerance towards non-compliance. In recent months, the Real Estate Regulatory Authority (RERA) has penalized several companies for disregarding RERA guidelines concerning the National Risk Assessment report and AML questionnaire completion.

Key Updates

  • A broader ban on implementing UN-imposed financial sanctions
  • Extended corporate liability provisions for money laundering and terrorism financing offenses
  • Expanded definitions to extend the scope of activity subject to AML law regulation

These changes reflect a comprehensive approach to strengthening Bahrain’s financial crime prevention measures.

Official Statement

A senior official from the Central Bank of Bahrain emphasized their commitment to combating financial crimes: “These amendments demonstrate our unwavering commitment to combating financial crimes and maintaining Bahrain’s reputation as a responsible global financial hub.”

Impact on Bahrain’s Standing

The implementation of these new penalties and regulations is expected to further solidify Bahrain’s standing within the MENA region and assert its position among international best practices in financial crime prevention.