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FRIDAY, DECEMBER 2, 2022
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Regulator warned 127 on financial crime compliance By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net BAHAMIAN regulators issued warnings to 127 law and real estate firms over noncompliance with anti-financial crime mandates while giving this nation’s $306m-plus residential real estate sales a clean bill of health. The Compliance Commission, which supervises non-financial services institutions over their compliance with anti-money laundering and counter terror financing laws, revealed in a recentlypublished report that it was forced to write to multiple companies in both industries for failing to supply a risk assessment and/or register with it. Disclosing that three unnamed law firms were fined during 2019-2020 for failing to answer questions about the potential financial crime risks they and their clients pose, the Compliance Commission said it had “detected
• Nation’s $306m residential property sales in all-clear • Bahamas ‘unlikely to be real estate laundering centre’ • But three law firms fined over risk assessment failure a significant change” where companies falling within its regulatory purview were recognising their legal obligations to register rather than doing so under the threat of “enforcement” measures being applied. The revelations came in a Compliance Commission report that concluded The Bahamas was “unlikely” to be “a real estate-based money laundering centre” because there were sufficient checks and balances at multiple stages of the property purchasing process to properly
identify clients and the source of funds used to finance their acquisitions. The document, obtained by Tribune Business, drew on numerous sources including the Bahamas Real Estate Association (BREA), Central Bank, Immigration Department and Bahamas Investment Authority (BIA) in affirming that 2021 was likely the strongest year ever for real estate sales with more than $306m worth of residential properties said to have been sold.
Total Bahamian real estate sales for that year were later pegged at $500m, or half a billion dollars, by the report - a figure shown to be some $200m higher than the $300m worth of activity estimated in 2017. The total value of available real estate inventory, or stock, was put at more than $3bn. The Compliance Commission, acknowledging that real estate purchases are known to be “attractive for potential misuse by money launderers and terrorist financiers” throughout the world, added: “Real estate is often chosen globally as a vehicle for criminals to launder ill-gotten gains because property offers a path to legitimacy and will appreciate over time. This allows criminals to enjoy their property and eventually the proceeds of sale.” The Bahamas, with its private islands and high-end homes in gated communities and condominiums that
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Gov’ts deficit jumps $75m but below full-year run rate By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE GOVERNMENT incurred a $75m October deficit after it was yesterday revealed that monthly spending on goods and services more than doubled to drive a 24.5 percent yearover-year recurrent spending increase.
The Ministry of Finance, in unveiling the October fiscal performance report, gave no explanation for why spending on goods and services had risen by more than 100 percent year-over-year - from $31.2m in October 2021 to $63.1m this year - although it could simply be related to “timing issues” and when invoices and bills come due for payment.
Still, it represented the major factor driving the $56.7m year-over-year increase in total recurrent (fixed cost) spending for the month. This more than offset the 20.9 percent year-overyear jump in tax revenues, which increased from $169.8m to $205.3m, to result in the Government’s deficit for the first four months of the 20222023 fiscal year more than
quadrupling compared to the end-September position. The $74.9m worth of ‘red ink’ incurred during October, representing by how much government spending exceeded revenues, took the fiscal deficit from $21.3m at end-September to $96.2m at the end of the following month. Personal emoluments, meaning public sector salaries
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FTX payout probe urged as US trustee intervenes By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net FTX’s Bahamian provisional liquidators were yesterday urged to “thoroughly investigate” any payouts to local investors that violated the Supreme Court asset freeze as the US Justice Department moved to intervene in Delaware. Local insolvency practitioners told Tribune Business that the trio appointed to take charge of FTX Digital Markets, the collapsed crypto exchange’s Bahamian subsidiary, have “massive powers” to recover and “claw back” any withdrawals found
to represent a so-called fraudulent preference that disadvantages other creditors and investors. The call came as the US trustee, who represents the US Justice Department in bankruptcy cases, moved for the appointment of an “independent examiner” to investigate the claims of “fraud, dishonesty and mismanagement” surrounding FTX’s spectacular collapse from a worth of $32bn to zero in just over a week. Andrew Vara, in a filing with the Delaware Bankruptcy Court, argued that such an appointment would allow John Ray, appointed
NASSAU Cruise Port’s top executive yesterday predicted that the facility will receive around 4.5m passengers in 2024, representing around a 12.5 percent increase on arrivals projected for the upcoming year. Michael Maura, who have the Prime Minister and other government officials a tour of the $300m Prince George Wharf transformation, told reporters that the facility is expecting year-over-year growth in cruise passenger numbers of some 25 percent in 2023.
‘Season survival’ fears on 50% lobster price plunge • Bahamian fisherman having to ‘weather the storm’ • Those who bet on prices staying high vulnerable • Grouper season close limits alternative options By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net FEARS were yesterday voiced that some Bahamian fishermen “may not survive the season” as the industry seeks to “weather the storm” created by lobster tail prices plunging by up to 50 percent. Paul Maillis, the National Fisheries Association’s (NFA) secretary, told Tribune Business that fishermen who invested heavily in their vessels and operations in expectation that last year’s prices “of upwards of $20 per pound” will be maintained are especially vulnerable to the drop-off. Disclosing that seafood processors are paying fishermen as little as $10 per pound for lobster in some parts of The Bahamas, he attributed the “suppressed prices” to increased supply as rival sources such as South Africa ramp up production back to pre-pandemic levels with the lifting of COVID restrictions. While catch volumes have held at 2021 levels, Mr Maillis told this newspaper that Family Island communities were being especially hard hit by the price fall-off. Besides having fewer sales outlets outside of processors and exporters, they are also feeling the general squeeze from inflation and cost pressures far more than New Providence. With “the price of everything going up” bar lobster, he added that some fishermen are now struggling to “pay their bills” and still hoping that the Government can provide some relief on fuel costs - possibly by diversifying supply sources if the US eases sanctions on Venezuela and allows the South American country to resume production in earnest once again. With one alternative income source cut-off for Bahamian fishermen yesterday through
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Cruise port targeting 4.5m arrivals in 2024 By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
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That will take cruise arrivals to some four million, as compared to this year’s 3.2m, with the Nassau Cruise Port chief executive explaining that passenger numbers will grow faster than vessels berthing because the latter are getting ever-bigger with larger occupancies. The port, which is scheduled to complete its transformation by next May and have its grand opening towards the end of that month, is eyeing a 4.5 percent rise in cruise ship arrivals next year compared to pre-pandemic numbers. And, for 2024, it expects to
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