Barbados Financial Regulators Adapt Amid COVID-19 Pandemic: Protecting Reputation and Combating Money Laundering Threats

Amid the global economic upheaval caused by the COVID-19 pandemic, Barbados’ financial regulators have shown unwavering commitment to safeguarding the island’s reputation as a compliant and well-regulated financial hub.

Adhering to International Best Practices

Barbados, with its emphasis on transparency and international standards, continues to attract global investors. Despite scrutiny from international regulatory bodies and media, the country’s regulators have demonstrated their dedication to maintaining and even exceeding international best practices in financial regulation.

FATF’s Urgent Call to Action

The Financial Action Task Force (FATF), an international organization leading the fight against money laundering and terrorist financing, highlighted in their updated report on COVID-19 that the pandemic presents new opportunities for financial crimes. These threats include counterfeiting of medical goods, cybercrime, investment scams, and abuses of economic stimulus measures. The FATF urged jurisdictions to remain vigilant and actively address these new risks and vulnerabilities created by the pandemic.

Adaptation to New Challenges

As regulators adapted to the challenges posed by the COVID-19 pandemic, they implemented strict health and safety protocols in their offices while embracing remote working policies and technological investments to facilitate communication and information sharing, such as the Central Bank of Barbados’ COVID-19 Task Force.

Technology-Driven Regulatory Environment

Regulators updated their regulatory frameworks in line with FATF and OECD guidance, implementing modified inspection processes, virtual inspections, and digital file submissions. They also held regular webinars and online training sessions, providing frequent regulatory updates and implementing regulatory forbearance.

Key Lessons Learned

Throughout the pandemic:

1. The accelerated adoption of technology by regulators, including the acceptance of electronic data submission, increased communication among regulators, and a shift towards remote working policies.
2. The importance of improving cybersecurity supervision to prevent cybersecurity risks as a result of the increased use of electronic data.

Preparing for the Post-Pandemic Future

As the world settles into a ’new normal’, small IFCs like Barbados can build on the lessons learned during the pandemic in strengthening their regulatory and supervisory practices to withstand future crises.

[i] FATF Report [ii] Central Bank of Barbados 2020 Annual Report