Financial Crime World

Title: Bermuda’s Proactive Approach to Money Laundering and Terrorist Financing: Legislations and Regulatory Measures

Background

Bermuda, a member of the Caribbean Financial Action Task Force (CFATF), has taken strong actions against money laundering and terrorist financing by implementing international standards set by the Financial Action Task Force (FATF). With a membership of 170 countries, FATF has issued 40 recommendations to prevent money laundering and nine special recommendations to counter terrorism financing, all of which Bermuda has committed to implementing.

Proceeds of Crime Act 1997 (POCA Act)

The POCA Act, effective since January 19, 1998, expanded provisions against criminal proceeds laundering and introduced the confiscation of assets derived from criminal conduct.Key points of the POCA Act include:

  • Established a Suspicious Activity Reporting (SAR) regime
  • Required individuals to report any knowledge or suspicion of money laundering or terrorist financing to the Financial Intelligence Agency (FIA)
  • Protected those who report from civil liability
  • Created the National Anti-Money Laundering Committee

National Anti-Money Laundering Committee

  • The committee comprises of 12 members, including:
    • Chairman
    • Solicitor General
    • Director of the FIA
    • Financial Secretary
    • Director of Public Prosecutions
    • Permanent Secretary of the Ministry of Justice
    • Commissioner of Police
    • Chief Executive Officer of the Bermuda Monetary Authority
    • Collector of Customs
    • and other appointees by the Minister of Justice

Regulations and International Cooperation

  • The Minister of Justice, in consultation with the National Anti-Money Laundering Committee, has the power to make regulations aimed at detecting and preventing money laundering.
  • In 2008, new regulations, the Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing) Regulations 2008, were enacted.

Role of Bermuda Monetary Authority (BMA)

  • BMA regulates the financial services industry
  • Responsibilities include licensing, prudential supervision, regulation, and inspection of financial institutions
  • Strict licensing regime serves as a barrier against illicit or criminal activities
  • Ensures compliance with Bermuda’s AML/CFT systems and controls under the Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing Supervision and Enforcement) Act 2008.

Conclusion

Through a combination of legislation, regulatory measures, and international cooperation, Bermuda effectively addresses money laundering and terrorist financing concerns, showcasing its commitment to global standards and maintaining its reputation as a leading financial center.