FATF Status

The Bahamas is no longer on the FATF List of Countries that have been identified as having strategic AML deficiencies

Latest FATF Statement - 18 December 2020

The FATF congratulates The Bahamas for the significant progress it has made in improving its AML/CFT regime. The Bahamas has strengthened the effectiveness of its AML/CFT system and addressed related technical deficiencies to meet the commitments in its action plan and remedy the strategic deficiencies identified by the FATF in October 2018.​

The FATF now de-lists The Bahamas from the list of Jurisdictions under Increased Monitoring. The Bahamas is therefore no longer subject to the FATF’s increased monitoring process. The Bahamas will continue to work with CFATF to improve further its AML/CFT regime.

European Commission List of Countries with Strategic Deficiencies in their AML/CFT Regimes

The Bahamas was removed from the EU Commission list of high risk countries in March 2022.

Compliance with FATF Recommendations

The last follow-up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in the Bahamas was undertaken in December 2022. According to that Evaluation, the Bahamas was deemed Compliant for 20 and Largely Compliant for 20 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 0 of the Effectiveness & Technical Compliance ratings.

The investment climate in The Bahamas is marred by inconsistent enforcement of anti-corruption laws, with reports of officials engaging in corrupt practices and limited accountability for conflicts of interest. The current administration has raised concerns over the former government's handling of contracts during the COVID-19 state of emergency, alleging significant misappropriation of funds, although no criminal charges have been filed as of April 2022. Despite the introduction of the Public Procurement Act to enhance transparency, challenges remain in the implementation and regulation of government contracts, contributing to a perception of corruption that hinders foreign direct investment.

The Bahamas has a high per capita GDP of $25,194 and is classified as a developed country, although it faces significant income inequality. The economy is heavily reliant on tourism, which accounts for over 70% of GDP and employs more than half of the workforce, making it vulnerable to external shocks like the COVID-19 pandemic and Hurricane Dorian. Despite recent economic growth attributed to a rebound in tourism, unemployment is estimated to be between 20 to 25 percent, highlighting the need for economic diversification and investment in other sectors.

The Bahamas has a stable investment climate characterized by political stability, a well-developed legal system, and a high per capita GDP. The government actively encourages foreign direct investment, particularly in tourism and financial services, while also targeting diversification into sectors like technology and renewable energy. However, challenges such as bureaucratic inefficiencies, high energy costs, and restrictions on foreign investment in certain sectors remain significant barriers to attracting more investment.