Bahamian Court Overturns Asset Freezes Due to Violation of Separation of Power

On November 27, 2001, a Bahamian court ruled that freezing of suspicious bank accounts by the executive branch is unconstitutional. According the media reports, Financial Clearing Corp. a company whose assets were frozen in January, successfully contended before the Supreme Court that, prior to use of its power to freeze accounts, the financial police unit must obtain an order from the court. The ability to freeze accounts was part of the new legislation enacted approximately one-year ago to respond to the placement of the Bahamas on the Financial Action Task Force list of non-corporative countries. In June, FATF removed the Bahamas from its list, partly as a result of the new Bahamian legislation. Unless the Bahamas Government can overturn the court decision, its Financial Investigative Unit will have to obtain a court order in the future.