The Bahamas has been named as the jurisdiction where $176 million was allegedly laundered in a scandal linked to a senior Panamanian government official.
For The Bahamas, the fact that the laundering of the $176 million was alleged to have occurred in the jurisdiction as recently as 2009/2010, may mean further reputational damage as the country continues to struggle to shake off the tax evasion/money laundering stigma.
According to newsroompanama.com alleged irregularities in a Bahamian bank account are linked to a money laundering investigation into former Panamanian president, Ernesto Perez Balladares. That website claims that evidence received by the Special Prosecutor’s Office of Organized Crime in Panama at the end of January suggested $176,961,057 in deposits in the Bahamian account, and disbursements of $176,962,091 over a 13-month period between May 4, 2009 and June 30, 2010.
Two checks from Panamanian company Shelf Holding Inc., allegedly authorised by Balladares, were deposited in a Bahamian account under the name Seaside Foundation, according to the report. The checks were for $175,000 and $45,000 and were allegedly deposited in August 2005 and December 2005, respectively.
The discovery of the two checks recently led the prosecutor in the case, Marcelino Aguilar, to pursue further investigation into the matter.
The former president and 11 others are allegedly unable to justify the amount of money they received from Shelf Holding and another company, Lucky Games, which the report alleges benefitted from a grant when Balladares was in power between 1994 and 1999.
Bahamian “know your client” legislation calls for bankers to understand who owns accounts and to understand the source of significant deposits to accounts. The penalties on the books for bankers facilitating money laundering are also considered by some to be aggressive. Further, banks dealing with politically exposed persons (PEPs) have an added duty of care in monitoring the activity on those accounts.
Whether the allegations prove true or not, the accusation and naming of the jurisdiction in the affair may still have a negative impact on how the jurisdiction is perceived.
The news also comes as the US State Department’s March 3, 2011, International Narcotics Control Strategy Report (INCSR) called for The Bahamas to “enhance its anti-money laundering/counter-terrorist financing regime by implementing the National Strategy on the Prevention of Money Laundering.” The INCSR also said the jurisdiction should ensure the establishment of a public registry for beneficial owners of all entities licensed in the jurisdiction.
The Bahamas has not yet entered into a tax information exchange agreement with Panama.
