Anti-Money Laundering (AML) and Anti-Terrorist Financing (ATF) Regulations in Bermuda

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Overview

This guide provides an overview of the anti-money laundering (AML) and anti-terrorist financing (ATF) regulations in Bermuda. It covers various aspects of AML/ATF regulations, including definitions, training requirements, offences, predicate offences, penalties, and reporting requirements.

Definitions of Financial Institutions and Independent Professionals

Financial institutions: Persons who carry on specific types of business in or from Bermuda are considered financial institutions.
Independent professionals: Professional legal advisers or accountants providing services to other persons when participating in financial or real property transactions are also considered independent professionals.

Training Requirements

Employee training for financial institutions and independent professionals is essential to ensure compliance with AML/ATF regulations. This includes training on procedures, policies, and best practices to prevent money laundering and terrorist financing.

The following five primary offences related to money laundering are listed:

Concealing or transferring proceeds of criminal conduct: Concealing or transferring funds obtained through criminal activity is a serious offence.
Assisting another to retain such proceeds: Assisting someone in retaining the proceeds of criminal activity is also an offence.
Acquisition, possession, or use of the proceeds of criminal conduct: Acquiring, possessing, or using funds obtained through criminal activity is prohibited.
Failure to disclose knowledge or suspicion of money laundering: Failure to report suspected money laundering activities is an offence.
Tipping off: Informing someone about a suspicious transaction or activity that may indicate money laundering is also an offence.

Predicate Offences

A money laundering offence is committed if the funds in question represent proceeds of criminal conduct. “Criminal conduct” includes:

Drug trafficking: Trafficking in controlled substances is considered a predicate offence.
Relevant offences: Any other relevant offence, as defined by the regulations, can also be considered a predicate offence.

Foreign Tax Evasion

Tax evasion can be considered a predicate offence for AML purposes, both within Bermuda and outside the country.

Penalties and Reporting Requirements

Penalties for AML/ATF offences can range from up to 20 years imprisonment or an unlimited fine or both, depending on the specific offence. Additionally, financial institutions and independent professionals are required to report suspicious transactions and activities to the relevant authorities.

Comprehensive Compendium

A comprehensive compendium of Bermuda’s AML/ATF legislation is available at Conyers Dill & Pearman’s website for further reference.