AML-ATF Ministerial Advisory 2/2023: Money Laundering and Terrorist Financing (2023-07-07)

Summary

This advisory from Bermuda's Minister of Legal Affairs and Constitutional Reform (issued 7 July 2023) draws attention to the FATF's 23 June 2023 public statements identifying jurisdictions with strategic AML/CFT deficiencies, and directs the Bermuda regulated sector to apply enhanced due diligence accordingly under the Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing) Regulations 2008 (POCA Regulations). It replaces all previous advisories on this subject.

• Call for Action (black list): DPRK, Iran and Myanmar are identified as high-risk; firms must treat them as high risk and apply counter-measures and enhanced due diligence proportionate to the risk.
• Increased Monitoring (grey list): Albania, Barbados, Burkina Faso, Cameroon, Cayman Islands, Croatia, Democratic Republic of the Congo, Gibraltar, Haiti, Jamaica, Jordan, Mali, Mozambique, Nigeria, Panama, Philippines, Senegal, South Africa, South Sudan, Syria, Tanzania, Turkiye, Uganda, United Arab Emirates, Vietnam and Yemen are listed; firms should take appropriate risk-mitigating actions, which may include enhanced due diligence.
• Sanctions overlay: Jurisdictions marked with an asterisk (DPRK, Iran, Myanmar, DRC, Haiti, South Sudan, Syria, Yemen) are also subject to sanctions measures under the International Sanctions Regulations 2013, requiring additional measures beyond enhanced due diligence.
• Legal basis: Regulation 11(1)(aa) and (ab) of the POCA Regulations require relevant persons, on a risk-sensitive basis, to apply enhanced customer due diligence to business relationships or transactions involving countries identified by FATF or CFATF as higher risk.

The advisory applies to all entities and persons covered by Regulation 4 of the POCA Regulations, and firms are told to read the full FATF statements (Annexes A and B) to properly assess and act on the associated risks; the list of high-risk countries is explicitly non-exhaustive.

Key obligations

• Relevant persons must apply enhanced customer due diligence, on a risk-sensitive basis, to customers, business relationships or transactions connected with DPRK, Iran and Myanmar, and apply counter-measures where called for.
• Relevant persons must take appropriate risk-mitigating actions, potentially including enhanced due diligence, in relation to customers, business relationships or transactions connected with the listed increased-monitoring (grey list) jurisdictions.
• Firms dealing with the asterisked jurisdictions (DPRK, Iran, Myanmar, DRC, Haiti, South Sudan, Syria, Yemen) must apply additional measures required under the International Sanctions Regulations 2013.
• Firms must read the annexed FATF statements in full to properly determine and act on the risks associated with each listed jurisdiction.

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