Financial Crime World

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Bahamas Money Laundering Techniques and Trends Revealed

The Bahamas, a tropical paradise with a wealthy economy heavily reliant on tourism and offshore financial services, has long been vulnerable to money laundering risks. The country’s second-largest sector is financial services, which dominated nearly US$255.6 billion as of 2018.

Adding to the Grey List

In October 2018, the Financial Action Task Force (FATF) added the Bahamas to its grey list due to deficiencies in its Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) framework. The move prompted significant changes to the country’s laws and regulations.

Progress Towards Compliance

The Caribbean Financial Action Task Force’s (CFATF) Mutual Evaluation Report found that the Bahamas had made notable progress in rectifying technical compliance deficiencies. The country has also continued its commitment to transparency by amending specific sections of legislation with the aim of achieving substantial compliance with all 40 FATF recommendations.

History of Money Laundering in the Bahamas

The Bahamas’ history of money laundering is marked by high-profile cases, including former Chilean dictator Augusto Pinochet using two offshore shell companies to launder nearly US$12 million. A report released in 2018 named the Bahamas as a primary money laundering point.

AML Laws and Regulations in Place

To combat money laundering, the Bahamas has implemented various laws and regulations:

  • Proceeds of Crime Act: Makes the laundering, searching, seizure, and confiscation of proceeds of crime illegal.
  • Financial Intelligence Unit Act: Requires financial institutions to report suspicious transactions.
  • Financial Transactions Reporting Act (FTRA): Requires financial institutions to verify customers’ identities and report questionable transactions.
  • Anti-Terrorism Act: Considers money collected and laundered for terrorist activities as a crime.

Advanced AML Solutions

In order to stay at the forefront of AML compliance efforts, enterprises subject to AML regulations in the Bahamas can benefit from AI-driven AML solutions offered by companies like Sanction Scanner. These advanced solutions enable organizations to meet their AML obligations efficiently and ensure financial integrity.