Although it has decided to take several countries and jurisdictions off its list of “primary concern”, the U.S. government has again named The Bahamas as a country where there remains serious concerns about money laundering.
The “Jurisdictions of Primary Concern” are those jurisdictions that are identified as “major money laundering countries”, according to the newly-released International Narcotics Control Strategy Report (INCSR) for 2006.
A major money laundering country is defined as one “whose financial institutions engage in currency transactions involving significant amounts of proceeds from international narcotics trafficking”.
But the INCSR report says, “However, the complex nature of money laundering transactions today makes it difficult in many cases to distinguish the proceeds of narcotics trafficking from the proceeds of other serious crimes.
“Moreover, financial institutions engaging in transactions involving significant amounts of proceeds of other serious crime are vulnerable to narcotics-related money laundering.”
It explains that the focus of analysis in considering whether a country or jurisdiction should be included in this category is on the significance of the amount of proceeds laundered, not on the anti-money laundering measures taken.
This is a different approach taken from that of the Financial Action Task Force (FATF) Non-Cooperative Countries and Territories (NCCT) exercise, which focuses on a jurisdiction’s compliance with stated criteria regarding its legal and regulatory framework, international cooperation, and resource allocations.
Last October, then Attorney General Alfred Sears reported that after five years of monitoring this country the FATF announced at its plenary meeting in Paris, France that it would remove The Bahamas from the list of countries that it would continue to monitor.
But he said, “The Government of The Bahamas will maintain the vigilant position that we have and will not relax in any respect the pace of regulatory cooperation.”
The Jurisdictions of Primary Concern category is the most negative listing in the INCSR report. The Bahamas was one of 43 countries or territories in this category. Others in the region included Antigua and Barbuda and Haiti.
The two other categories listed in the report were Jurisdictions of Concern, and Other Jurisdictions Monitored.
The report notes, “The current ability of money launderers to penetrate virtually any financial system makes every jurisdiction a potential money laundering centre. There is no precise measure of vulnerability for any financial system, and not every vulnerable financial system will, in fact, be host to large volumes of laundered proceeds.”
It also said the Government of The Bahamas has enacted substantial reforms that could reduce its financial sector’s vulnerability to money laundering.
“However, it must steadfastly and effectively implement those reforms,” the report says. “The Bahamas should provide adequate resources to its law enforcement and prosecutorial/judicial personnel to ensure that investigations and prosecutions are satisfactorily completed, and requests for international cooperation are efficiently processed.”
By: Candia Dames, The Bahama Journal
