Financial Crime World

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Bermuda Takes Significant Steps to Mitigate Financial Risks

HAMILTON, BERMUDA - The island territory of Bermuda has made significant strides in strengthening its anti-money laundering (AML) and combating the financing of terrorism (CFT) regime, according to a recent report.

Mutual Evaluation Report Highlights Progress

The Mutual Evaluation Report, conducted by international experts, highlights Bermuda’s progress in implementing new legislation, policies, and initiatives aimed at mitigating financial risks. The report notes that the country has undergone significant changes since its last mutual evaluation exercise in 2008, which has strengthened its overall AML/CFT framework.

Key Areas of Improvement

The report identifies several key areas where Bermuda has made notable improvements:

  • Enactment of new legislation and implementation of policy initiatives
  • Amendment to the Proceeds of Crime Act 1997 to formally identify the National Anti-Money Laundering Committee (NAMLC) as the entity responsible for coordinating activities to cyclically identify, assess, and understand Bermuda’s money laundering and terrorist financing risks

National Risk Assessments

Bermuda has undertaken three national risk assessments (NRAs), with the organization and coordination of these NRAs led by the NAMLC and carried out by various working groups. These efforts have helped to better understand and address the country’s inherent exposure to money laundering, which is largely dominated by international financial businesses.

Areas for Improvement

While there are still some areas for improvement, particularly within the designated non-financial businesses and professions (DNFBPs) sector, the report notes that factors exist that mitigate the inherent risks in these sectors even before measures were implemented.

Economy and Demographics

Bermuda’s economy is primarily based on international financial services, catastrophe reinsurance, and tourism. The country has a population of just over 63,000 people and an internal self-government system. Its official language is English, and the Bermuda dollar is pegged to the US dollar at par.

Conclusion

The report concludes that while there are still some limitations in the effectiveness of measures to mitigate risks, Bermuda’s progress in strengthening its AML/CFT regime has been significant. The country’s efforts to improve its technical compliance status have been demonstrated through the enactment and amendment of key legislation, as well as the implementation of policy initiatives.

Full Report Available

The full Mutual Evaluation Report is available for download on the website of the Financial Intelligence Agency (FIA) of Bermuda.