The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

The Opposition's deputy leader yesterday urged the Government to clarify whether new laws will criminalise the Asue savings schemes long popular among many Bahamians.

Chester Cooper, the Exuma and Ragged Island MP, while backing efforts to stamp out Ponzi schemes and other common financial frauds that “prey on Bahamians" warned many could find themselves in violation of the law if the new Financial and Corporate Services Providers Bill also caught Asue schemes in its net.

"I’m very glad that this legislation clearly outlaws financial schemes, like Ponzi and pyramid schemes, that prey on Bahamians who may not be well-versed in complex financial operations," the Opposition's finance spokesman added.

"We need to protect people from bad actors who claim that money just falls from the sky. Some have lost their life savings, and we need to protect them and prevent this from happening again."

Mr Cooper, though, quickly added: “I would like, however, for government to clarify whether this covers Asues. While I don’t personally like the high-risk profile of Asues, making them illegal might see many Bahamians in violation of the law.

"As the violation carries a fine of up to $75,000 on a first violation, and double the fine and possibly four years in prison on the second violation, we need to be careful. Asues are as much a part of Bahamian culture as conch salad. It would be good if we could get some clarity from government on this and what it all means for Asues.”

Turning to the Digital Assets and Registered Exchanges (DARE) Bill, which was introduced at the same time, Mr Cooper said: “It has my support, but I want to point out a few things. So, this Bill is clearly about regulating who can provide platforms for digital currency, cryptocurrency trading, custodianship and interchange with digital and other government-backed currency. I think this is a really good step.

“It creates the framework for a progressive ecosystem. However, I do want to note that mobile wallet providers are well ahead in this arena and should be continuously engaged. The Central Bank alone cannot build all the capacity needed with the ongoing engagement of the stakeholders.”

Mr Cooper also called for a national savings campaign to assist Bahamians in setting aside some of their incomes for retirement and future needs. He said: “I have noted repeatedly in here that our national savings rate is abysmal. Yes, we understand the current environment of high unemployment and high cost of living. However, this is an historic challenge even in pre-pandemic economic times.

“As the economy crawls back toward some sense of normalcy, hopefully, once the major resorts reopen, we should encourage Bahamians to put something away for a rainy day.

“I call on the government to lead a national savings campaign with the support of banks, insurance companies and financial services institutions. Not only is this critical for families in emergencies, but it also fosters national development, financial discipline and increases the possibilities for wealth creation by being able to take advantage of investments and other opportunities.”

Linking this to pension reform, Mr Cooper added: “There is also a concern about the low level of participation in pension plans in the country. We need pension reform in the public and private sector, and there also needs to be easier access for companies to get their employees participating in pension funds.

"Too many Bahamians work for a lifetime and find themselves struggling in retirement or unable to retire. We also call on the Government to harmonise regulators of financial and corporate service providers. As it stands there is too much overlap that leads to inefficiencies, such as sometimes needing multiple licenses and submitting to multiple oversight procedures that duplicate efforts.

"Under the Financial and Corporate Service Providers Bill we are debating today, it provides oversight of mobile wallets and bill payment services. However, the Central Bank of The Bahamas also seems to provide oversight of mobile wallets under its Non-Bank Electronic Retail Payment license, and then there is the issue of the Financial and Corporate Service Providers license itself.

“It is unclear from reading this legislation whether a company only providing corporate services, like company incorporations, would require the full Financial and Corporate Service Providers license.”