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Blacklisting fallout. Swiss blame Bahamian authorities

by C. E. Huggins

NASSAU, The Bahamas: Swiss authorities recently blamed The Bahamas for the failure of an investigation into Al Taqwa Management Organisation now Nada Management Organisation. The investigation goes back to 9/11 when US authorities discovered that a bin Laden (not that bin Laden) was associated with Al Taqwa.

In December 2000 the government of The Bahamas created legislation that it believed would remove it from the OECD’s blacklist

As part of this exercise Bahamian regulators decided they would no longer entertain banks that had no physical presence in The Bahamas. Scores of banks, derogatorily known as brass plate banks, did their homework and decided to close shop.

According to Al Taqwa’s Bahamian attorney and representative Sean Hanna, Youssef Nada, Al Taqwa’s founder, had decided that their Bahamian operations did not warrant the added expense of a physical presence and had decided to wind up the operation. The Central Bank had given a grace period for such banks to make the necessary arrangements.

Then 9/11 came along. The Government of The Bahamas in a show of support for the US, seized accounts of persons and or organisations, including those of Al Taqwa, that according to information supplied by US authorities, were either of suspect origin or demonstrated strong terrorism connections. Bahamian authorities determined that none of the frozen funds (over $30 million) or any of the individuals had had any connections with or support for known terrorists or their organisations.

Al Taqwa found itself the subject of investigations by both Swiss and Bahamian regulators. As can best be determined, the investigations arose because some Al Taqwa investors bore the unfortunate last name of bin Laden. It is alleged that the gentleman was one of the scores of siblings of the world’s most wanted man Osama bin Laden.

The Swiss authorities conducted an investigation; this was in 2001, and concluded that Al Taqwa’s operations in Switzerland were well within the prescribed boundaries of fiduciary responsibility.

As Mr. Hanna stated at the time, the only change required of Al Taqwa Management Organisation by the Swiss banking regulatory body, was a name change. The Swiss felt this would avoid any possible confusion between the banking operations in The Bahamas and the Management operation in Switzerland.

Al Taqwa Management Organisation in Switzerland became the Nada Management Organisation named after the founder.

In 2002 the Central Bank of The Bahamas issued a press release in which it stated that Al Taqwa’s licence to operate a bank in The Bahamas was being revoked for security reasons.

Mr. Hanna disputed the Central Bank’s suggestion that Al Taqwa Bank in The Bahamas had been asked to close its operations because of security risks.

According to documents provided by Mr. Hanna at the time, the Central Bank, in all its assessments, had not only found Al Taqwa’s conduct acceptable but also specifically stated that the bank was a welcome member of the community of banks and trusts in The Bahamas.

Indeed the Central Bank not only offered to extend the period required for non-resident banks to become resident if they so wished but also praised the bank as a outstanding member of the banking community, and expressed the wish that the bank would become a resident bank.

Now Swiss authorities, unable to find the smoking gun among Al Taqwa’s operations, claimed that Bahamian regulators had not given “a usable response” to their request for judicial assistance, hence the suspension of their investigations against Al Taqwa.

The record will show however that Al Taqwa’s Bahamian operations were wound up in the first half of 2002.

Central Bank documents stated that Al Taqwa was an acceptable member of the jurisdiction.

Acceding to the OECD’s blacklisting requirements, may have helped the jurisdiction but it also made it possible, as it appears to be in this instance, for authorities to blame the failure of investigations on Bahamian regulators.


One comment for “Blacklisting fallout. Swiss blame Bahamian authorities”

  1. Ummm….so did it just occur to Swiss authorities that much of the world views the country as a giant tax haven? Because that opinion has been around for a while.

    Posted by Pterrafractyl | August 31, 2012, 9:54 am

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