AML/ATF Ministerial Advisory 2/2020: Money Laundering and Terrorist Financing controls in higher risk jurisdictions (2020-11-20)

Summary

This is a Ministerial Advisory issued by Bermuda's Minister of Legal Affairs (published via the BMA's AML/ATF documents) drawing the regulated sector's attention to the latest FATF and CFATF public statements on jurisdictions with strategic AML/CFT deficiencies. It reminds relevant persons of their existing obligation under the Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing) Regulations 2008 to apply enhanced due diligence to higher-risk countries, and replaces all previous advisories on this subject.

• Call for Action list: DPRK and Iran are identified as high-risk jurisdictions requiring counter-measures and enhanced due diligence, and are also subject to sanctions measures under the International Sanctions Regulations 2013.
• Increased monitoring (grey) list: Albania, The Bahamas, Barbados, Botswana, Cambodia, Ghana, Jamaica, Mauritius, Myanmar, Nicaragua, Pakistan, Panama, Syria, Uganda, Yemen and Zimbabwe are listed as presenting higher risk, requiring appropriate risk-mitigation actions which may include enhanced due diligence in high-risk situations; Myanmar, Nicaragua, Syria, Yemen and Zimbabwe are also noted as subject to sanctions measures.
• Jurisdictions removed from monitoring: Iceland and Mongolia are confirmed as no longer subject to FATF increased monitoring.
• CFATF update: The CFATF withdrew its November 2019 call regarding Sint Maarten, which is no longer in effect, though Sint Maarten remains in enhanced follow-up.
• Scope: The Advisory applies to all persons and entities subject to the POCA Regulations under Regulation 4: AML/ATF regulated financial institutions, independent professionals, casino operators, dealers in high value goods registered with the FIA, and real estate brokers and agents.

The Advisory is informational in nature but operationalises an existing statutory duty: firms must consider the FATF and CFATF assessments (annexed in full) and apply enhanced due diligence or counter-measures on a risk-sensitive basis where appropriate, including additional sanctions-related measures for jurisdictions marked as subject to sanctions.

Key obligations

• Apply enhanced customer due diligence, on a risk-sensitive basis, to business relationships or transactions involving persons in jurisdictions identified by FATF or CFATF as higher risk (Regulation 11(1)(aa) and (ab) of the POCA Regulations 2008)
• For jurisdictions on the FATF Call for Action list (DPRK, Iran) and other sanctioned jurisdictions marked with an asterisk, apply counter-measures and take additional measures required under the International Sanctions Regulations 2013
• Read the annexed FATF and CFATF statements in full to properly assess and determine risk relating to the listed jurisdictions before taking action
• Share the CFATF update regarding withdrawal of its Sint Maarten statement with supervised entities (applicable to supervisors)
• Note that the list of higher-risk jurisdictions is not exhaustive; firms should continue to assess other jurisdictions not yet reviewed by FATF for potential higher ML/TF risk

Applies to

AML/AFT regulated financial institutions, independent professionals, casino operators, dealers in high value goods registered with the FIA, real estate brokers and real estate agents