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AML/CTF Compliance in Barbados

WHAT ARE THE

Money laundering and terrorism financing laws in Barbados?

In Barbados, money laundering and terrorism financing are serious offences and are governed by several laws and regulations including:

  • Money Laundering and Financing of Terrorism (Prevention and Control) Act, 2011 - This act provides the legal framework for the prevention and control of money laundering and terrorism financing in Barbados. It outlines various offences, investigative powers, reporting obligations, and penalties related to money laundering and terrorism financing activities.
  • Proceeds of Crime Act, 1990 - The Proceeds of Crime Act criminalises money laundering and provides mechanisms for the investigation, seizure, and forfeiture of proceeds derived from criminal activities.
  • Anti-Terrorism Act, 2002 - This act establishes measures to combat terrorism financing in Barbados. It defines offences related to terrorist activities, including financing, and provides law enforcement authorities with tools to investigate and prosecute such offences.

There are other laws in Barbados that relate to anti-money laundering and counter-terorism financing - https://barbadosfiu.gov.bb/legislation/

WHAT ARE THE

Key obligations that reporting entities have under Barbadian laws?

The key obligations under the AML/CTF laws in Barbados  include:

  • Customer Due Diligence (CDD) - regulated entities, including banks, financial institutions, money service businesses, accountants, lawyers, real estate agents, and dealers in precious metals, are required to conduct customer due diligence measures. This includes verifying the identity of customers, obtaining beneficial ownership information, and assessing the risk associated with each customer.
  • Record-Keeping - regulated entities must maintain records of transactions, customer identification information, and supporting documentation for a minimum of five years. These records should be readily available for inspection by regulatory authorities.
  • Reporting Suspicious Transactions - regulated entities must report any knowledge, suspicion, or reasonable grounds to suspect money laundering or terrorism financing to the Financial Intelligence Unit of Barbados. The reports should be made promptly when suspicion arises.
  • Compliance Programs - regulated entities are expected to establish and maintain effective AML/CFT compliance programs. This includes implementing internal policies, procedures, and controls to detect, prevent, and report money laundering and terrorism financing activities. Staff training and regular independent audits are also important components of these programs.

WHO ARE THE

ML/TF regulators in Barbados and what functions do they perform?

The Barbados Financial Intelligence Unit is the regulatory agency responsible for overseeing and enforcing these laws.

Barbados cooperates with international counterparts in combating money laundering and terrorism financing. This involves exchanging information, cooperating on investigations, and providing assistance to other jurisdictions when requested.

WHAT ARE THE

Industry sectors subject to ML/TF regulations?

In Barbados the main industries that are regulated under the Money Laundering and Financing of Terrorism (Prevention and Control) Act, 2011 include:

Financial Institutions

includes banks, credit unions, insurance companies, money service businesses, and other entities engaged in financial activities. Financial institutions are typically required to implement customer due diligence measures, maintain records, and report suspicious transactions to the Financial Intelligence Unit (FIU).

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Money Service Businesses (MSBs)

MSBs, such as money remitters, currency exchange services, and money transmission businesses, are specifically mentioned as regulated entities under the act. They must comply with customer due diligence requirements and report suspicious transactions.

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Accountants and Auditors

Professionals and firms in the accounting and auditing industry are often considered regulated entities and may have obligations to implement anti-money laundering measures, conduct customer due diligence, and report suspicious transactions.

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Lawyers and Law Firms

The act may impose obligations on lawyers and law firms to prevent money laundering and financing of terrorism. This may include customer due diligence, record-keeping, and reporting suspicious transactions.

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Real Estate Agents and Developers

Professionals involved in real estate transactions, such as real estate agents and developers, may fall under the regulatory requirements outlined in the legislation. This may involve conducting due diligence on clients, maintaining records, and reporting suspicious activities.

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Dealers in Precious Metals and Stones

Entities engaged in buying or selling precious metals, gemstones, or other high-value commodities may be subject to anti-money laundering obligations. These may include verifying customer identities, conducting transaction monitoring, and reporting suspicious activities.

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WHAT ARE THE

Penalties for non-compliance with AML/CTF laws?

In Barbados, the penalties for non-compliance with money laundering and terrorism financing laws can vary depending on the specific offense committed and the provisions violated. Money laundering is now penalized by a maximum USD $1 million punishment and 25 years in jail under the MLPCA. Here are some potential penalties that may apply:

  • Administrative Penalties - the Financial Intelligence Unit (FIU) of Barbados has the authority to impose administrative penalties for non-compliance with AML/CFT requirements. These penalties can include fines and sanctions, the specific amount of which can vary based on the severity and frequency of the violation.
  • Criminal offenses - serious breaches of money laundering and terrorism financing laws can result in criminal charges. Criminal penalties can include fines and imprisonment, depending on the nature and severity of the offense. Convictions under the AML/CFT Act can lead to significant fines and imprisonment for individuals involved in money laundering or terrorism financing activities.
  • Forfeiture of Funds and Assets - authorities have the power to seize and forfeit funds and assets that are determined to be involved in or derived from money laundering or terrorism financing activities. This can include freezing bank accounts, confiscating properties, or seizing other assets.

 

WHAT ARE THE

Largest fines for non-compliance with AML/CTF laws?

There are no administrative penalties recorded on the Barbados Financial Intelligence Unit’s website.