Guidance Notes for AML/ATF Regulated Financial Institutions on Anti-Money Laundering and Anti-Terrorist Financing 2023 (BMA)

Summary

These are the Bermuda Monetary Authority's General Guidance Notes on Anti-Money Laundering and Anti-Terrorist Financing (AML/ATF), approved by the Attorney-General under section 49M of the Proceeds of Crime Act 1997 and issued by the BMA under section 5(2) of the Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing Supervision and Enforcement) Act 2008. They replace and supersede the BMA's earlier general guidance notes and set out how AML/ATF Regulated Financial Institutions (RFIs) should interpret and implement Bermuda's AML/ATF legal and regulatory framework using a risk-based approach.

• Senior management and controls: Chapter 1 sets expectations for senior management responsibility and internal AML/ATF controls.
• Risk-based approach: Chapter 2 explains how RFIs should conduct and apply institutional and business risk assessments.
• Customer due diligence: Chapters 3 to 5 cover standard and non-standard (simplified/enhanced) CDD measures, including for higher-risk customers and PEPs.
• Sanctions: Chapter 6 covers compliance with international sanctions regimes.
• Ongoing monitoring and wire transfers: Chapters 7 and 8 address ongoing monitoring of business relationships and wire transfer requirements.
• Suspicious activity reporting: Chapter 9 sets out obligations to identify and report suspicious activity to the Financial Intelligence Agency (FIA).
• Training and record-keeping: Chapters 10 and 11 cover staff training/awareness and record-keeping requirements.
• Sector annexes: Annexes provide sector-specific guidance for trust, insurance and investment business, PEP risk factors, the regulatory landscape in Bermuda, and (pending update) corporate service provider, money service and digital asset businesses.

The guidance applies to RFIs as defined in section 42A(1) and Schedule 3 of the Proceeds of Crime Act 1997, referenced by Regulation 2(1) of the Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing) Regulations 2008 (POCR), and to designated financial groups. It is directed particularly at senior management and compliance/reporting officers who set an RFI's AML/ATF risk management policies and procedures. Courts and the BMA may take the guidance into account when assessing compliance with the underlying acts and regulations, though the notes themselves state that sector-specific annexes for corporate service provider, money service and digital asset businesses were, as of this version, still being updated separately for industry consultation.

Key obligations

• RFIs must establish adequate and proportionate policies and procedures to prevent and detect money laundering and terrorist financing (failure to do so is itself an offence under POCR).
• RFIs must conduct standard and, where warranted by risk, non-standard (simplified or enhanced) customer due diligence in line with Chapters 3 to 5.
• RFIs must apply a risk-based approach, including conducting institutional and business risk assessments as described in Chapter 2.
• RFIs must screen for and comply with applicable international sanctions regimes (Chapter 6).
• RFIs must conduct ongoing monitoring of business relationships and transactions (Chapter 7).
• RFIs must comply with wire transfer requirements set out in Chapter 8.
• RFIs must promptly disclose to the FIA knowledge, suspicion or reasonable grounds to suspect money laundering or terrorist financing, and must not tip off persons other than the FIA about such disclosures.
• RFIs must provide employee training and awareness programmes on AML/ATF obligations (Chapter 10).
• RFIs must maintain records in accordance with the record-keeping requirements in Chapter 11.

Applies to

AML/ATF regulated financial institutions (RFIs), insurance managers, relevant insurance marketplace providers and brokers, money service businesses, corporate service providers, trust businesses, operators of investment funds, digital asset businesses, lending and leasing businesses, private trust companies, designated financial groups

Related documents

• This document is made under Proceeds of Crime Act 1997
• This document is made under Proceeds of Crime (Anti-Money Laundering and Anti-Terrorist Financing Supervision and Enforcement) Act 2008