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by pltm
(PLTM) - The BVI continues to be a major target for money laundering and drug trafficking, a concern raised by the United States (US) in a recent report. Further, the US said there is a small percentage of prosecutions, particularly in the area of money laundering.
This fresh concern was raised in its March 2018 International Narcotics Control Strategy Report (INSR), released by the United States Department of State Bureau of International Narcotics and Law Enforcement Affairs.
According to the report, the BVI’s proximity to the U.S. Virgin Islands and its use of the U.S. dollar as its currency, pose additional risk factors for money laundering.
“The BVI, similar to other jurisdictions in the Eastern Caribbean, is a major target for drug traffickers, who use the area as a gateway to the United States,” the report said.
However, “BVI authorities work with regional and U.S. law enforcement agencies to help mitigate these threats.”
In relation to money laundering, the report pointed out that there has been a small percentage of prosecutions.
It stated that between January 1 and October 31, 2016, there were two money laundering related prosecutions and no money laundering related convictions.
“There have been 15 money laundering convictions since 2008. This extremely low volume of prosecutions and convictions is not commensurate with the size and complexity of the BVI’s financial sector,” the report said.
It however noted that the BVI has implemented a register which provides authorized BVI authorities direct and immediate beneficial ownership information.
“This registry is not publicly available. The register will allow all beneficial ownership information to be shared with the UK government within 24 hours of a request.”
Further, the report said that the government is currently engaged in amending legislation to enable the Financial Investigation Agency (FIA) to take enforcement actions against Designated Non-Financial Businesses and Professions (DNFBPs) that are non-compliant with their Anti Money Laundering (AML) legal responsibilities.
“Such amendments will allow the FIA to enforce administrative penalties against non-compliant DNFBPs.”
In the BVI, criminal penalties for money laundering and money laundering-related offenses have been increased to up to $500,000 and 14 years in prison, depending on the offense. Administrative penalties have been increased from a maximum of $4,000 to a maximum of $100,000. Penalties under the Anti-Money Laundering Regulations have also been increased to$150,000.
The Financial Services Commission (FSC) is the sole supervisory authority responsible for the licensing and supervision of financial institutions.
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