FATF MUTUAL EVALUATION REVIEW REPORT ON BARBADOS

On 21st February, FATF published the results of the mutual evaluation review of the AML/CFT regime in Barbados, where the on-site inspection took place in December 2016.  On the essential 11 Immediate Outcomes of effectiveness, Barbados scored “Moderate” or “Low”.  Amongst the key findings, the report said that –

  • The 2016 National Risk Assessment (NRA) undertaken by the country failed to comprehensively identify national ML/TF threats and vulnerabilities and critically there was limited analysis of terrorist financing (TF) risk, transparency of legal persons and arrangements, and the risks associated with Trust and Corporate Service Providers (TCSP) and cross border cash movements;
  • Gaming institutions are not casinos and are not currently regulated and supervised for AML/CFT purposes. To date a risk assessment of this sector has not been conducted;
  • The supervision of the DNFBP sector appears disjointed and to a certain extent ad hoc;
  • The relevant agency has not been able to satisfactorily demonstrate to the Assessors that it has been able to effectively supervise the international business sector and TCSP in particular;
  • It is evident that supervisors generally are not applying the full range of available sanctions for non-compliance by financial institutions and DNFBP with AML/CFT requirements;
  • Across the insurance and securities sectors, not all financial institutions have a good understanding of the ML/TF risks to which they are exposed and therefore have not yet implemented appropriate ML/TF risk mitigation controls;
  • TCSP lacked an understanding of their ML/TF risk exposure and therefore have not implemented appropriate ML/TF risk mitigation controls;
  • the legal obligation to report ‘attempted or aborted transactions’ is not discharged by all reporting entities;
  • there is no evidence that the FIU conducts strategic analysis;
  • There is no efficient feedback system from the FIU to the reporting entities when SAR are submitted, and additionally, there is limited feedback from law enforcement and competent authorities to the FIU on the usefulness of the financial intelligence the FIU provides;
  • ML charges are not pursued as primary offences. Priority is placed on the prosecution of predicate offences;
  • There is no designated asset recovery direction or cash seizure provisions;
  • Barbados has recorded no investigations, prosecution or convictions for TF; and
  • Barbados has disclosed that it will not be implementing terrorist financing provisions of the relevant UN Resolution.

http://www.fatf-gafi.org/media/fatf/documents/reports/mer-fsrb/MER-Barbados.pdf

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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