Frozen bank accounts, inoperable ATM cards loom

Apr 20, 2011 News

Final warning! From left: Bank of Baroda's Vinod Sehgal; GBTI's John Tracey; Scotiabank's Amanda St. Aubyn and Republic Bank's John Alves.

…as Money Laundering Law kicks in April 30

By Leonard Gildarie

Commercial banks yesterday made a last-ditch attempt to encourage account-holders to provide them with required documentation with an April 30th deadline fast approaching.
With just over a week left, the Guyana Association of Bankers (GAB) announced that failure to comply will render the accounts inactive or frozen, with ATM cards being inoperable.
Under the legislation, all deposit account holders were to provide proof of address and copies of identification, under measures designed to minimize the possibility of money laundering and the financing of terrorist activities.
The US and other territories have blacklisted a number of countries which have not complied. Nearer to home, Trinidad and Tobago, according to media reports, was facing blacklisting for its failure to get the Financial Intelligence Unit (FIU) Act passed, but the government on Monday managed to do so after a marathon weekend session.
GAB Chairman, John Tracey, during a press conference yesterday at Republic Bank’s New Market Street Headquarters, explained that Guyana had passed its own FIU legislation since 2009. However, two deadlines – May and December last year – have passed without the response from account holders being satisfactory.
John Alves, Republic Bank’s Chief Executive Officer, emphasised that this warning is final and there will be no extension.
Scotiabank’s head, Amanda St. Aubyn and Vinod Sehgal, Managing Director of Bank of Baroda, were also present at the press conference.While GAB declined to disclose the extent of the problem by releasing figures, it did point out that deadlines have resulted in long lines for the commercial banks, New Building Society and Hand In Hand Trust, which all deal with deposit accounts.
With a long weekend ahead including Good Friday and Easter Monday, the financial institutions are already bracing themselves for more lengthy queues.
According to Tracey, the matter had been worrying the Ministry of Finance and Paul Geer, Head of Guyana’s Financial Intelligence Unit.
This last attempt, via the media, is intended to galvanize the response, the GBTI banker said.
After the April 30 deadline, account-holders who have not complied will see their accounts being made inactive, with only salaries and payments processed. ATM cards will simply not work, Alves stressed.
Should the account become inactive after that deadline, to rectify it, the account holder(s) will have to provide the two documents.
The problem accounts are mainly ones that were opened prior to 2006-2007, a time when banks were not required to take copies of ID cards and proof of address. However, the practice was subsequently adopted.
Already, in the case of Republic Bank, overseas customers have been written to asking them to submit the requisite information.
Account-holders who have been receiving statements can use the postmark as a proof of address, the bankers assured.
Tracey admitted that there may be some account-holders who will be “up in arms” over the developments, but the reality is that the deadline has already been set in keeping with the regulations.
Regarding the issue of possibilities of someone unable to provide a proof of address, the banking officials noted that the regulations cater for third party authorization.
The five commercial banks in Guyana are Republic Bank, GBTI, Scotiabank, Bank of Baroda, Citizens Bank and Demerara Bank.