Registrar General’s Department Responds to Save The Bays Filing to Block Release of Financial Records
April 19, 2017- Nassau, The Bahamas – On April 19th 2017, The Tribune newspaper published an article detailing the contents of an application in the Supreme Court by The Coalition to Protect Clifton Bay, also known as Save The Bays, to block a request from the Registrar General for its financial records. The article suggests that Save The Bays is being specifically targeted by this request which has be “driven by the government’s animosity.”
The Registrar General’s Department has given notice to nearly one hundred (100) non-profits on its Registry so far, with the intention of notifying all non-profits once the necessary contact information has been updated. The Registrar General’s Department is simply exercising the authority of the Registrar General to ensure that all non-profit organizations are adhering to the 2014 Regulations and that The Bahamas is in compliance with our international obligations with regards to regulating the non-profit sector.
Over the years, The Bahamas has been evaluated by various international organizations on its compliance with international Anti-Money- Laundering and Combating the Financing of Terrorism (AML/CFT) standards. As a result of the evaluations a number of recommendations for improving AML/CFT compliance by the non-profit sector were made, as increasingly non-profits are used to support international criminal activity.
In response, The Bahamas introduced regulations in the form of the Companies (Non-Profit Organizations) Regulations 2014, (the “2014 Regulations”). The 2014 Regulations, as crafted, sought to regulate all non-profit organizations, whether incorporated under the Companies Act or otherwise. This was necessary to meet our international obligations as a part of the global community and to protect our financial industry.
The Registrar General Department pursuant to these Regulations, and more specifically regulations 3 and 13, has therefore sought to ascertain the status of all existing non-profits on its Registry. In doing so the Registrar General’s Department is exercising its supervisory and enforcement authority to monitor and regulate non-profit organizations.
For example, Section 3 (c) (d) (e) and (f) of the 2014 Regulations allows for the Registrar General:
c) to monitor the effectiveness of these Regulations in
i) protecting non-profit organizations from being used for terrorist financing; and
(ii) ensuring the compliance of The Bahamas with its international obligations, to the extent they apply to nonprofit organizations;
(d) to undertake periodic reviews of the non-profit organizations sector in The Bahamas for the purpose of identifying the features and types of non-profit organizations that are at risk of being used for terrorist financing;
(e) to undertake outreach to non-profit organizations with the objective of protecting the non-profit organization sector in The Bahamas from being used for terrorist financing; and
(f) to discharge such other functions as may be assigned under the Act, these Regulations or any other legislation.
Additionally, Section 13 (1) and (2) of the Regulations states under provision of records to the Registrar General’s Department that the Registrar may:
“1) ….. on the ground specified in paragraph (2), by written notice, to a registered non-profit organization, require it to produce the records that the non-profit organization is required to keep under regulation 12, or any of those records.
(2) …… give notice under paragraph (l) only where it reasonably requires the records specified in the notice to assess the extent, if any, to which the registered non-profit organization is being used to assist terrorist financing.”
As referenced in The Tribune article, Section 12 of the law allows the Registrar General to request documents including those that detail the organization’s purpose, objective, and activities. It also provides for the identification of persons who control or direct the activities of the organization and any financial records that show the source of the gross annual income of the organization, explain the transactions within and outside The Bahamas and that show that the funds of the organization have been used in a manner consistent with its objective and activities. The “extent, if any, to which the registered non-profit organization is being used to assist terrorist financing” can only be deduced by sight of the requested documents and an evaluation thereof.
No single non-profit has been targeted. This review of all non-profits on the Registry is important to ensure that we are in compliance with our international obligations, preventing the use of non-profits in The Bahamas as vehicles for international criminal activity, including terrorism, and protecting our financial industry which is vital to our national development.