On 2 December 2024, the Bermuda Ministry of Justice issued AML-ATF Ministerial Advisory 3/2024, emphasising the need for vigilance against money laundering and terrorist financing risks in specific jurisdictions. This advisory provides guidance for financial institutions and relevant entities in Bermuda on applying Enhanced Customer Due Diligence (EDD) for transactions involving high-risk countries. This Advisory replaces all previous advisory notices issued by the Minister of Justice on this subject.
Key takeaways
Legislative mandate: The Proceeds of Crime (AML-ATF) Regulations 2008 mandate enhanced due diligence for:
- Countries identified as high-risk by the Financial Action Task Force (FATF) or the Caribbean Financial Action Task Force (CFATF).
- Jurisdictions linked to money laundering, corruption, terrorist financing, or international sanctions.
High-risk jurisdictions: FATF's October 2024 publication lists high-risk jurisdictions requiring EDD. These include Iran, North Korea, Myanmar, and others such as Nigeria, South Africa, and the Philippines. The advisory also highlights countries under FATF's increased monitoring (commonly referred to as the "grey list").
Ministerial guidance: The advisory urges institutions to:
- Treat transactions with these jurisdictions as high-risk.
- Apply EDD measures, such as enhanced monitoring and countermeasures, proportional to the risks involved.
Sanctions and compliance: Countries like North Korea and Iran are subject to international sanctions. Firms must adhere to the International Sanctions Regulations which require additional compliance measures. Relevant links for further guidance are provided in the advisory.
Why enhanced due diligence matters
EDD helps safeguard against financial crimes that undermine economic stability and security. Institutions must:
- Evaluate and mitigate risks associated with high-risk jurisdictions.
- Enhance policies and controls to detect unusual or suspicious transactions.
- Ensure compliance with international and domestic regulations.
Call to action
All entities governed by Bermuda's AML-ATF framework (financial institutions, real estate brokers, casino operators, and dealers in high-value goods) must:
- Familiarise themselves with FATF assessments.
- Integrate these risk considerations into their anti-money laundering strategies.
For more details on the advisory and sanctioned jurisdictions, see here.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
