The European Union’s (EU) European Commission is set to blacklist The Bahamas once again, placing it on its list of countries that “pose significant threats to the financial system of the union”, according to information received by international news agency Reuters. The
commission’s move has left local lawmakers baffled.
“I have to research to see what this is about now,” Deputy Prime Minister and Minister of Finance Peter Turnquest told Guardian Business yesterday.
Attorney General Carl Bethel told this paper that the commission committed itself to informing countries of its intention to place them on any list. Which, according to him, it has not done in this case.
“The Bahamas regrets the apparent decision of the EU Commission to signal an intention to add The Bahamas to a blacklist which the EU parliament mandates that the commission maintain,” Bethel said.
“This is especially so in light of an earlier public commitment made by the EU Commission to engage in discussions with potentially affected countries prior to placing them on their blacklist.
“To date The Bahamas has not received any advance notification or warning at any diplomatic level.”
The Reuters article said the commission’s document is a draft version and is subject to change, but the article also reveals the body’s intention to publish the list tomorrow.
The EU mandates that international financial centers like The Bahamas have in place legislation, to its liking, guarding against money laundering and terrorism financing.
The Bahamas has been moving steadily towards being ever more compliant with the whims of the EU and other bodies like the Organization for Economic Cooperation and Development (OECD) and the Financial Action Task Force (FATF). Yet, the country repeatedly finds itself on lists of non-cooperative jurisdictions.
“Under EU law, banks and other financial and tax firms are obliged to scrutinize more closely their clients who have dealings with countries on the list,” the Reuters article states.
“The European Commission is set to include Panama, The Bahamas, Mauritius and nine other countries on its list of states that pose a financial risk to the bloc because of anti-money laundering and terrorism financing shortfalls,” a draft document notes.
“The document, seen by Reuters and expected to be published on Thursday, also includes Barbados, Botswana, Cambodia, Ghana, Jamaica, Mongolia, Myanmar, Nicaragua and Zimbabwe.”
Bethel maintained, as he has many times before, that The Bahamas continues to attain the highest standards in its fight against money laundering, terrorist financing and other risks.
“It should also be noted that the FATF at its January plenary in Paris, France, agreed that The Bahamas should begin the exiting process from the FATF ICRG (International Cooperation Review Group) gray list and had agreed to an on-site visit, which had to be postponed due only to the COVID-19 pandemic,” said Bethel.
Many financial services pundits have opined that bodies like the EU, OECD and FATF will continue to “move the goalpost” for international financial centers like The Bahamas, which have been accused of being havens for hiding tax proceeds owed to European governments.