Bermuda cited in beneficial ownership failure
An assessment of beneficial ownership registers in British Overseas Territories published by Transparency International UK, pinpoints Bermuda amid claims that most major offshore financial centres have failed to deliver on transparency commitments made nearly seven years ago.
The group has called on Britain to insist on improvements, restate the goals and take action against those who resist.
A key recommendation states: “If any Overseas Territory continues to defy the will of the UK Parliament, the Government should be prepared to escalate its response. All legal and constitutional options should be on the table to ensure these commitments are delivered in full and without further delay.”
Among a list of key concerns, the report cites: “Years of delays, with Bermuda not expecting to deliver access until 2026.”
The group is the British wing of Transparency International, the self-styled “world’s leading non-governmental anti-corruption organisation” with more than 100 chapters.
A statement from the British organisation reported on the first tranche of assessments, with the examination of 92 criteria across two areas: the quality of each territory’s beneficial ownership framework and the accessibility of its register.
Bermuda and the British Virgin Islands received an F, or failing grade, for the lack of accessibility of their registers. Bermuda also received a C, a barely passing grade, for its beneficial ownership framework score.
Montserrat achieved an A grade in both categories, making it the strongest performer in this first release.
The ratings are based on a blueprint published earlier this year, designed to give Overseas Territories clear practical guidance to meet their transparency commitments and reveal the ultimate owners of registered companies, whether through public or legitimate interest registers.
The latest report, Opening Up Offshore Secrecy, lists the researcher as Margot Mollat, senior policy and research manager at Transparency International UK.
She commented: “These results make one thing clear: behind the promise of progress, very little has changed.
“Company registries in [the Cayman Islands], [BVI] and Bermuda largely remain closed, and these territories have fallen short of their promises made at previous Joint Ministerial Council meetings.
British Overseas Territories committed to establishing public registers until a 2022 European Court ruling found that fully public registers conflicted with privacy rights.
The resulting European standard requires that only those with a “legitimate interest” in beneficial ownership information would have access. Groups such as journalists, academics and civil society organisations working to combat money laundering are presumed to have a legitimate interest and therefore receive open access to the data.
At the November 2024 Joint Ministerial Council in London, the Overseas Territories without publicly available registers committed to “implement legitimate interest access registers of beneficial ownership with the maximum possible degree of access and transparency”, while containing the necessary safeguards to protect the right to privacy.
The British Government made it clear that it still expected to see public registers in the long run.
“A legitimate interest model still requires territories to be serious about transparency and should not serve as a cover for backtracking on earlier commitments.
“Journalists, civil society groups and other investigators are essential to exposing wrongdoing. Continuing to deny them meaningful access sends a clear message: those territories still prioritise secrecy over wider transparency efforts to effectively tackle money laundering.
“When billions are looted and laundered through jurisdictions like the [BVI], communities worldwide pay the price — in schools, housing or hospitals in dire need of public funding. They face consequences, and so should the territories that fail to deliver promised reforms.”
Territories that have opted for an EU-style “legitimate interest” model rather than the public registers they originally committed to, could in theory still achieve the top grade, but in practice achieved much lower scores. This is mainly owing to their narrow interpretation of the European model, and refusal to follow the EU guidance. These registers still limit the ability of journalists, civil society and law enforcement to combat money laundering.
Although the Crown Dependencies have recently committed to introducing legitimate interest registers, none are yet operational or accessible to the public, despite similar promises to deliver public registers more than seven years ago.
Under this assessment, jurisdictions such as these would be unlikely to score better than an F in respect to access to beneficial ownership data.
The organisation said only three territories — Gibraltar, Montserrat and St Helena — have established fully public registers.
A request for government comment was unanswered by press time.
• For more on the report “Opening up Offshore secrecy”, see Related Media
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