The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

The deputy prime minister yesterday pledged that “further strengthening” of the Financial Intelligence Unit (FIU) is underway to improve its handling of suspicious transactions reports (STRs).

K Peter Turnquest, told Tribune Business that the government was moving to further enhance the FIU’s skill sets and expertise, along with improvements to its technology and software to enable it to better analyse STRs submitted by Bahamian financial institutions.

He said: “In terms of the FIU itself we have put in place a new director, Quinn McCartney. We have supplemented him with a forensic accountant, and we intend to recruit additional forensic accountants, analysts and IT professionals to further strengthen the FIU.

“We have invested already for the upgrade of the technology equipment and software that will facilitate the efficient management of suspicious transaction reports so that we can have a more efficient feedback to the reporting institutions, as well as a correspondent liaison with the police cyber crime unit.”

The FIUs role is to analyse the STRs received and determine whether there is sufficient evidence of money laundering, or some other form of financial crime, that warrants their forwarding to the police for further investigation and potential prosecutorial action.

Mr Turnquest was speaking after the US State Department’s annual International Narcotics Control Strategy Report (INCSR) called for an improvement in the FIU’s “product” so it could better assist Bahamian and international law enforcement agencies with probes into suspected illicit financial transactions.

The same report also complained that too few STRs are being filed by Bahamas-based financial institutions when measured against the industry’s overall size.

“Considering the size and character of the international financial sector, the number of filed STRs is low,” the US report said. “In 2018, the FIU (Financial Intelligence Unit) received only 332 STRs from both domestic and offshore entities, down from 446 in 2017.”

It also implied that the number of money laundering-related prosecutions and convictions in The Bahamas was relatively low when measured against the financial services industry’s size, adding: “In 2018, 32 investigations resulted in 34 persons being charged with money laundering offenses. There were 13 convictions in the same period. In 2017, there was only one prosecution.”

The US report concluded: “The Bahamas needs to address recognised deficiencies in its AML/CFT (anti-money laundering/counter terror financing) regime by demonstrating risk-based supervision of non-bank financial institutions, and ensuring timely access to adequate beneficial ownership information.

“Increasing the quality of the FIU’s products would better assist law enforcement to investigate and prosecute all types of money laundering, lead to successful forfeiture proceedings related to AML cases, and address gaps in terrorism and proliferation financing frameworks.”

Mr Turnquest said the government had made, and was making, positive strides towards addressing all the concerns raised by the US. “In respect to the beneficial ownership registry we have already passed legislation with respect to that,” he said. “We are funding that now.

“A $2.3m contract has been signed for the software. That should be up and running within a couple of months. With respect to the exchange of tax information, we have had the FATCA legislation in place since 2010, I believe, and that has been performing effectively as far as I am aware.

“All of the legislation we put in last year, the agreements we signed with respect to the automatic exchange of information, the base erosion framework, we have signed up to.”