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Last Updated: Feb 13, 2017 - 1:45:37 AM |
 Nassau, Bahamas - The financial services sector is under tremendous pressure yet again after reports of leaked information to a German website confirms to the names of hundreds of persons operating “letterbox” companies as shell companies for laundering money inside The Bahamas. Coming off of the heels of the “Panama Papers” scandal, in what followed was de-risking fears; we are now facing the lash of our own “leaked emails” that will cause further harm to our jurisdiction if we do not act with the right message.
The news is shocking to the DNA even as we have been watching with keen interest what’s taking place with regard to the de-risking phenomenon sweeping through offshore financial centres around the world.
We in the DNA are concerned that persons within the policy framework, and financial services industry insiders in The Bahamas, have watched de-risking matter take shape in our core-business and have not addressed the matters thoroughly. But even more so now, we are concerned that leaks of private information of businesses in The Bahamas are at an even greater risk to persons within the system.
While we clearly have not addressed the de-risking issues thoroughly, neither have we paid the type of respect to the Panama Papers scandal, it appears as if persons within the Bahamian policy framework are ill-equipped and unprepared to manage our international reputation, neither are they prepared to manage the private government files placed within their care.
While it is safe to assume that international compliance with FATCA (Foreign Account Tax Compliance Act), Know Your Customer (KYC) and Anti-Money Laundering (AML) safeguards should be at the core of the discussions with regard to the leaked emails to the German website: What also needs to be addressed now is the safety and security of the information kept on government and private files here in The Bahamas?
What is also not being discussed thoroughly, but what needs to be, is at what level of commitment is The Bahamas at with regard to implementing policy prescriptions that address the de-risking fears; and now we have to add to that the question now what would they do with regard to ensuring that leaks and sensitive government information that got to this German website out goes punished; and particularly what Washington DC link had first initial access to these emails and from who?
We have not been hearing enough from the Ministry of Finance or the Ministry of Financial Services, both Ministries that are in the forefront of these issues. The Bahamian people deserve more than this and need to be assured that their interests are being met and by how! Particularly as the DNA feels that all of these leaks and external pressures are being done in an attempt to force us to implement an open register for all corporate service providers- something that larger jurisdictions, particularly jurisdictions in London and Delaware, have been reluctant to do unless there is uniformity across all major financial centres.
Even in light of these issues, the DNA has been made to understand that we have signed onto FATCA and its full policy mandate in September, 2015. We have created specialized facilities within the bureaucratic network that is supposed to respond to the needs and concerns of those affected and concerned, however we have not been satisfied with our entire educational initiative on the matter neither are we sure that the government has done more, or less, than what it has said with regard to FATCA compliance because they are simply too convoluted and secretive for anyone to have a firm handle on affairs.
What we have also been made to understand is that we have been undergoing a series of evaluations and surveys testing the strength of our compliance standards and how resilient is our financial services sector to these standards. Thus far, we have left very little to be desired and in fact we cite negligence and complacency within the policy framework to address these issues.
So, when the DNA factors in these new leaks and irrelevant statements made about the prudence of our regulators on policy initiatives that larger jurisdictions don’t wish to follow themselves, we have to take into consideration what is taking place around the world and how we fit into it. Also, we must do what we can with regard to our international obligations before persons with vested interest to see our core business terminated have the fuel they need to ask for us to bend to their demands that are not in line with international best practice.
The DNA is very concerned about what we see taking place and industry professionals should not be blindsided because our policy network under the charge of this government. We wish not a repeat of the negligence and incompetence displayed during the 2000-2001 Financial Action Task Force fiasco that saw waves of companies and capital flee this country because the government of the day was either out to lunch or just flat out incompetent to handle the weight of this matter.
We call on this government to act responsibly, outline the core challenges of de-risking; the core problems that they will be addressing in this regard; make the public and industry professionals in particular aware of what has taken place to address these issues; and what will be taken into consideration and do so post haste in addition to investigating the nature of the leak with prejudice.
The DNA stands committed and ready to speak on and act in light of this soon to be former PLP government, and we wish all parties concerned to contact our offices with issues and matters that need to be addressed in the public square immediately and with certain force.
Youri Kemp
DNA Candidate for Garden Hills
DNA Spokesperson for the Economy and Finance
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