The days of charities governing themselves with little to no oversight are over, Attorney General Dale Marshall revealed today, declaring a “new world” required greater scrutiny of their financial affairs.
Fearing the possibility of being blacklisted for lax international anti-money laundering and anti-terrorism enforcement, the Justice Minister said Government is taking steps to ensure that these NGOs are subject to greater accountability.
Charities will be required to submit their financial reports each year, which includes their source of income and associations outside of Barbados or face the very real possibility of being de-listed, Marshall said.
Efforts earlier this year to gather this information have yielded little results and the time has come for Government to have a firmer hand, he declared.
He said: “Unfortunately, we are living in a new world now.
“We are living in a world where it is vital that we pay attention to the scourge of money laundering and terrorism financing.
“Charities in their very nature are considered to be high risk vehicles for money laundering and financing terrorism.
“Basically, all of the countries across the world are expected to meet certain basic minimum standards to demonstrate that we are serious about fighting money laundering and terrorism.l
The Attorney General said that if Barbados fails to meet these international standards then the country runs the risk of being blacklisted or losing its correspondent banking links.
But Marshall promised that Government will provide technical support to the charities that need it, as many of them may not be able to afford an accountant to prepare their records.
He also noted that Government will not demand documents prior to 2018 but charities must now comply with the requirements.
Marshall said: “We risk effectively being blacklisted in the international arena and the significance of this is that this blacklisting would likely result in the loss of correspondent banking to Barbadian financial institutions.
“This is not idle conjecture because in the past, the Caribbean region had about 20 correspondent banks, now we are just under 15.
“We don’t consider that of our 1,400 plus charities that any of them are going to be used as a vehicle for these scourges, but we have to be in a position to defend our level of supervisions.
“Our Charities Act was passed in 1979 and even so a lot of the requirements are not being met.
“Charities are required to maintain accounts and they are required to file balance sheets with the Company Registry, but like many things this never happens.”