Revised Central Bank-AMLA Guidelines - Anti-Money Laundering ...

AML/CFT GUIDELINEISSUED BY THECENTRAL BANK OF BARBADOSIN CONJUNCTION WITH THE ANTI-MONEY LAUNDERING AUTHORITYMAY 2011should gather the following information on a PEP:a. Estimated net worth, including financial statements;b. Information on immediate family members or close associates having transaction authorityover the account; andc. References or other information to confirm the reputation of the client.7.4.7. Corporate VehiclesBarbados law prohibits companies from issuing shares in bearer form. Where a licensee decidesthat companies with nominee shareholders represent an acceptable business risk, they shouldexercise care in conducting transactions. Licensees should ensure they can identify the beneficialowners of such companies and should immobilise bearer shares as a means of monitoring theidentity of such companies by, for example, requiring custody by:a. The licensee, or its subsidiary, regulated affiliate, parent or holding company;b. A recognized regulated financial institution in a jurisdiction with equivalent AML/CFTstandards; andc. Requiring the prior approval before shares can be exchanged.7.4.8 Correspondent BankingCorrespondent banking relates to the provision of banking services by one bank (correspondent)to another bank, usually domiciled overseas (respondent). A correspondent bank faces enhancedrisks, as it may have no relationship with the customers of the respondent bank. Examples ofcorrespondent banking include wire/fund transfers, trade related and treasury/money marketactivities.The decision to approve a respondent relationship should depend inter alia on the licensee’sassessment of the counterpart’s money laundering and terrorist financing prevention and detectionsystems and controls, and the quality of bank supervision and regulation in the counterpart’scountry. Licensees offering cross-border wire or fund transfers should avoid correspondent andrespondent banking relations with shell banks 12 .Licensees that offer correspondent banking services should conduct due diligence on theirrespondent banks on a risk basis. Reduced due diligence is acceptable where the respondentbank is listed on a recognized stock exchange; or is a member of the licensee’s own financialgroup and subject to a group AML/CFT programme and consolidated supervision.Where the respondent bank does not meet the foregoing criteria then the licensee should obtainthe following on the respondent bank:12A shell bank is a bank incorporated in a jurisdiction in which it has no physical presence and which isunaffiliated with a regulated financial group.Anti-Money Laundering/Combating Terrorist Financing Guideline May 2011 21Bank Supervision DepartmentCENTRAL BANK OF BARBADOS