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Accounts can't be frozen, Bahamas court decides
Anonymous
Posted: Friday, August 12, 2011

Posted: 11/29/2001 5:58:04 PM

By: David Marchant

I've obtained a copy of the court ruling and a statement from the Bahamas government.

A story on this will be published in the November 30, 2001 edition of OffshoreAlert.

David Marchant


Internal Administrator
Posted: Friday, August 12, 2011
Joined: 10/12/2010
Posts: 5780


Posted: 11/29/2001 5:09:01 PM

By: postman

Published Wednesday, November 28, 2001


Accounts can't be frozen, Bahamas court decides
Ruling weakens government money laundering laws
BY TOSHEENA ROBINSON
Associated Press


NASSAU, Bahamas -- A Bahamian court ruled Tuesday that it is unconstitutional for government regulators to freeze suspicious bank accounts, weakening laws that enabled the Caribbean nation to be removed from an international money laundering blacklist.

Lawyers for the Financial Clearing Corp., a company whose assets were frozen in January, argued before the Supreme Court that the power to freeze accounts should be left to courts, not a financial police unit.

The company also argued the law violates constitutional articles that protect against deprivation of property without compensation. Financial Clearing Corp. closed down soon after the government froze its $1 million in assets, lawyer Arnold Forbes said.

The government said in January it froze the assets because it had information suggesting the funds were connected to criminal activity, but it did not give further information.

Government lawyers could not be reached for comment Tuesday, and it was not clear if they would appeal the decision.

The law allowing regulators to freeze accounts was part of a legislative package passed a year ago to strengthen regulations on the Bahamas' financial sector after being named to an international money laundering blacklist.

With the new laws in place, the Paris-based Financial Action Task Force in June removed the Bahamas from its list, which now cites 19 countries as uncooperative in fighting money laundering.

Under Tuesday's ruling, the government will now have to apply to the Supreme Court to request that accounts be frozen, an often slow process that regulators worry leaves suspected companies ample time to pull their money out of the Bahamas before they can be investigated.


 

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