Combating Money Laundering in the Bahamas
The Bahamas has taken a crucial step in combating money laundering by defining the process and stages involved in this illegal activity. According to the Financial Action Task Force (FATF), money laundering is a three-stage process: Placement, Layering, and Integration.
What is Money Laundering?
Money laundering is the criminal act of concealing the true origin and ownership of funds derived from illegal activities, such as drug trafficking, robbery, and other serious crimes. It involves the physical disposal of cash proceeds derived from illegal activity (Placement), separating illicit proceeds from their source by creating complex financial transactions (Layering), and providing apparent legitimacy to criminally derived wealth (Integration).
The Bahamas’ Role in Combating Money Laundering
As a major international business and financial center, The Bahamas has a significant role to play in combating money laundering. Financial institutions licensed or registered to operate in or from The Bahamas that become involved in money laundering risk prosecution and loss of entitlement to operate from this jurisdiction.
FATF Recommendations
To combat money laundering, the FATF has developed 40 Recommendations aimed at tackling this illegal activity. These recommendations provide a framework for anti-money laundering efforts and are designed for universal application. They cover:
- The criminal justice system and law enforcement
- The financial system and its regulation
- International cooperation
CFATF and Regional Cooperation
The Caribbean Financial Action Task Force (CFATF) was established to promote regional awareness of money laundering and introduce evaluation programs to monitor implementation of the 40 Recommendations. The Bahamas is a member of the CFATF, along with other countries in the region.
Compliance Commission Efforts
The Compliance Commission, responsible for combating money laundering in The Bahamas, has been working closely with financial institutions and law enforcement agencies to educate them on the importance of detecting and reporting suspicious transactions.
Requirements for Financial Institutions
To combat money laundering, financial institutions are required to:
- Identify all clients, including beneficial owners of property
- Keep appropriate records
- Report suspicious transactions to competent national authorities
- Implement comprehensive internal control measures
Consequences of Non-Compliance
Financial institutions that become involved in money laundering risk severe penalties, including prosecution and loss of their operating license.
Contact Information
For more information on combating money laundering in The Bahamas, please contact:
Compliance Commission Poinciana House #34 East Bay Street Nassau New Providence The Bahamas
Phone: (242) 604-4323, 604-4331, 604-4333 Email: compliance@bahamas.gov.bs Opening Hours: Monday through Friday, 9:00am to 5:00pm