RAISE COUNTRY RISK ON BARBADOS

Our recent investigation into corruption in the East Caribbean republic of Barbados has uncovered information that we wish to share with compliance officers operating a risk-based AML/CFT program at international banks whose clients include citizens of Barbados, or entities incorporated there. 

Some of the issues:

(1) There are a large number of attorneys in Barbados known to be involved in land fraud, and other financial crimes, and it is a common practice for them to bank their criminal proceeds abroad, including in the United States, Canada and the United Kingdom. They are also using nominees to hold their assets overseas, including real estate investments in North America. 

(2) Politically Exposed Persons from Barbados are known to have sought to open bank accounts outside the country for amounts far above their salaries and income, raising the presumption that those finds are the proceeds of corruption.

(3) The courts in Barbados are known to be corrupt, and inclined to favor Barbadians over foreign nationals, and any bona fide legal dispute that your bank clients might have in Barbados will be at the mercy of a legal system where cases can be delayed for many years. Obtaining a judgment is often impossible.

(4) Violent crime, including homicides, has been increasing in Barbados of late; investors who will be required to be physically present, from time to time, in the country should take this into account.

(5) Barbados is an offshore financial center, and the positive identification of beneficial ownership of corporations formed there cannot be assured, meaning that a risk exists that individuals on international sanctions list, such as OFAC, may end up as unintended business partners of foreign investors, exposing them to fines or civil penalties.

Compliance officers who are charged with assessing Country Risk should conduct their own investigation, but in our opinion, risk levels for Barbados, its nationals and entities, should be raised at this time.