The International Monetary Fund recently published a report on the adherence
of Barbados to the international standards governing the prevention of money
laundering and terrorist financing.
The 'Report on the Observance of Standards and Codes on the FATF Recommendations
for Anti-Money Laundering and Combating the Financing of Terrorism for Barbados'
was prepared by the Caribbean Financial Action Task Force (CFATF), and contains
recommendations on how the AML/CFT system could be strengthened.
The assessment was based on the information available at the time of the mission
from December 4–16, 2006.
The report stated that:
"Barbados has criminalized money laundering (ML) broadly in compliance
with international standards. However, while the definition of unlawful activity
allows for a wide array of serious predicate offenses, human trafficking, corruption
and bribery are not totally consistent with the requirements of the Palermo
Convention."
"The low number of ML prosecutions and the factors attributed by the DPP
(Director of Public Prosecutions) for this suggest an ineffective use of ML
provisions. Terrorist financing (TF) is criminalized in accordance with the
TF Convention. Relevant forfeiture/confiscation powers are provided for under
separate statutes. While there is no specific legislative authority to freeze
terrorist funds or other assets of persons designated in accordance with S/RES/1267(1999),
relevant provisions to effect restraint of property can be utilized."
However, it observed that:
"While the Financial Intelligence Unit (FIU) carries out its functions
competently, it is hampered by a lack of resources. The law enforcement authorities
and the Office of Director of Public Prosecutions are under-resourced in relation
to their functions. The
competent authorities continue to engage in a wide array of joint law enforcement
initiatives."
The CFATF-compiled report went on to suggest that:
"Preventive measures for financial institutions are comprehensive and
generally in compliance with the FATF Recommendations. However, some of the
requirements are set out in laws and regulations, while others are only enforceable
on the licensees of the Central Bank of Barbados (CBB) and the Supervisor of
Insurance."
"Regulation and supervision of the financial sector is shared among four
regulatory authorities with varying supervisory powers. Except for trust and
company service providers who are licensees of the CBB, there are no measures
to monitor and ensure
compliance of DNFBPs with AML/CFT requirements. While the Registrar of Companies
maintains a register with information on directors and registered offices of
companies, there is no legislative requirement to disclose beneficial ownership
information."
And continued:
"Domestic co-operation among law enforcement and supervisory authorities
and other relevant government agencies is facilitated through the Anti-Money
Laundering Authority (AMLA). While the Mutual Assistance in Criminal Matters
Act (MACMA) allows for a wide range of mutual legal assistance for criminal
matters, the instrumentalities of ML and TF are not included. Requests for mutual
legal assistance are routed through the Attorney General who is the Central
Authority."
Commenting in detail on the preventative measures in place, the report revealed
that:
"Customer due diligence measures are generally comprehensive and include
customer identification, beneficial ownership requirements, ongoing due diligence,
measures for politically exposed persons, correspondent banking and new technologies
and non-face to face customers. Requirements for introduced business are also
detailed. These measures are generally applied by all financial institutions."
But reiterated that:
"The main shortcoming is that some requirements are not set out in law
or regulation as required by the FATF standards and others are only enforceable
on the licensees of the CBB and the Supervisor of Insurance."
It continued:
"While there are no secrecy laws inhibiting the implementation of the
FATF Recommendations, certain regulatory authorities are limited in their ability
to either share or access information. Recordkeeping requirements are extensive
and generally observed. However, there is no requirement in law or regulation
for account files and business correspondence to be retained for five years
after termination of the business relationship or for financial institutions
to ensure that records are available on a timely basis to competent authorities."
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