Financial Crime World

Thousands of Dollars in Illicit Finance Flow Through Bahamas Despite Anti-Corruption Efforts

Nassau, Bahamas - A recent report by the US Bureau of Democracy, Human Rights and Labor has raised concerns over the effectiveness of the Bahamas’ implementation of anti-corruption legislation. Despite significant progress in addressing financial crimes, thousands of dollars in illicit finance continue to flow through the jurisdiction.

Undermining Global Anti-Corruption Efforts

The Common Reporting Standard (CRS), a global standard for automatic exchange of information on financial accounts between tax authorities, is being undermined by citizenship and resident schemes that can conceal assets across jurisdictions. The Bahamas is one of several Caribbean countries where these schemes are prevalent, making it difficult for authorities to report on assets and exchange adequate information with other jurisdictions.

Efforts to Combat Financial Crimes

The country has enacted laws to address financial crimes, including:

  • Money Laundering Prevention Act of 1996: Prohibits money laundering and sets out provisions for supervision, freezing and forfeiture of assets, and international cooperation.
  • Proceeds of Crime Act of 1993: Outlines provisions for forfeiting and confiscating proceeds from certain crimes.

Challenges Remain

Despite these efforts, corruption and illicit finance remain significant problems in the Bahamas. In 2023, the country scored 64 on the Corruption Perception Index (CPI), indicating a moderate level of corruption.

  • Corruption: High- level government officials have been prosecuted for corruption, but cases have also been marred by allegations of witness intimidation and jury tampering.
  • Money Laundering Scandal: A recent scandal uncovered in 2023 highlights the jurisdiction’s vulnerability to financial crimes, involving millions of dollars in illicit funds being laundered through the country’s financial system.

Human Trafficking

Human trafficking is another significant problem in the Bahamas, with migrant workers from Haiti, Jamaica, and the Dominican Republic often falling victim to:

  • Domestic Servitude
  • Sex Trafficking
  • Exploitation in Low-Skill Employment

Law Enforcement Criticisms

The country’s law enforcement authorities have been criticized for their role in facilitating criminal activities. A survey by the World Justice Project found that 74% of citizens believed that elected representatives and politicians use public funds or property for personal needs.

Government Response

In response to these challenges, the government has announced plans to strengthen its anti-corruption efforts, including:

  • Increasing Transparency and Accountability in Government Procurement Processes
  • Enhancing Cooperation with International Partners to Combat Financial Crimes

However, more needs to be done to address the root causes of corruption and illicit finance in the Bahamas.