Welcome to Aspire Barbados’ series of blog posts regarding the Non-Profit Sector and Anti-Money Laundering. We hope you find them informative and insightful. This blog seeks to serve as an introduction to the Anti-Money Laundering system, which governs the Non-Profit Sector.
The Barbados Companies Act defines a non-profit company as a company without share capital. It is a separate legal entity from its members, who incur no personal liability or individual responsibility for the debts or other liabilities of the company. Further, a non-profit company must restrict its undertaking to one that is of a patriotic, religious, philanthropic, charitable, educational, scientific, literary, historical, artistic, social, professional, fraternal, sporting or athletic nature, or the like, or to the promotion of some other useful object.
The Charities Act defines a Charity to mean “any institution (corporate or not) which is established for charitable objects or purposes, and which is intended to and does operate for the public benefit, and is subject to the control of the High Court in the exercise of its jurisdiction with respect to charities” The Charities Act goes on to list the types of charitable objects or purposes for the purposes of the Act but this list is not exhaustive.
Any entity that falls under the definition of a non-profit company or a charity and is registered at the Corporate Affairs & Intellectual Property office must comply with the Anti-Money Laundering regulatory regime in Barbados.
The framework for the prevention and detection of drug trafficking, money laundering, terrorist financing and other serious crimes are as follows:
Drug Abuse (Prevention and Control) Act, Cap. 131;
Drug Abuse (Amendment) (Prevention and Control) Act;
Proceeds of Crime Act, 1990-13, CAP143
Proceeds and Instrumentalities of Crime Act, 2019;
Mutual Assistance in Criminal Matters Act, Cap. 140A;
Anti-Terrorism Act, Cap158;
Anti-Terrorism (Amendment) Act, 2019;
Money Laundering and Financing of Terrorism (Prevention and Control) Act, 2011-23 (MLFTA);
Money Laundering and Financing of Terrorism (Prevention and Control) (Amendment) Act, 2019;
Transnational Organised Crime (Prevention and Control) Act, 201-3; and
Criminal Assets Recovery Fund Act, 2016
On an international level, the Financial Action Task Force (“FATF”) 40 Recommendations (“The International Standards on Combating Money Laundering and the Financing of Terrorism & Proliferation – The FATF Recommendations”) set out a comprehensive and consistent framework of measures which countries should implement as a best practice through legislation and guidelines to combat money laundering and terrorist financing, as well as the financing of proliferation of weapons of mass destruction. These recommendations include combating terrorist financing, including the adoption of a new counter-terrorist financing operational plan.
The MLFTA empowers the Anti-Money Laundering Authority (AMLA) pursuant to section 26 to issue guidelines concerning money laundering and terrorist financing activities. Accordingly, AMLA issued a Guideline entitled “Combating Terrorist Financing Guideline for Charities and Non-Profit Organizations” in December 2019.
The sector must therefore comply with the local legislation and guidelines. In later blog posts, we will outline further information on how the sector can improve its anti-money laundering standards and the implications of the FATF requirements for the sector. Please see the following helpful links:
Incorporation of a Non-Profit Company
In conclusion, we hope you found the above information useful and will join us as we continue this series.
Contributing author: Shane Parris, ASPIRE Volunteer, Attorney-at-Law & Certified Anti-Money Laundering Specialist
