Anti-Money Laundering Bill…Guyana’s compliance dependent on passage of legislation

Oct 05, 2013 News

---

 

Ninety percent of Guyana’s compliance with the Caribbean Financial Action Task Force (CFATF) to fight money laundering and the financing of terrorism is dependent on the passage of the Anti-Money Laundering and Combating the Financing of Terrorism (Amendment) Bill that is before a Parliamentary Special Select Committee.
This is according to Paul Geer, Director of the local Financial Intelligence Unit (FIU), situated in the compound of Ministry of Finance.
Even if the Bill is passed in the National Assembly before November, when measures taken by Guyana to comply with CFATF’s recommendations will be reviewed, Guyana can be referred to CFATF as a country that has not taken sufficient steps to address its deficiencies.  It has missed the August 26 deadline set by Caribbean Financial Action Task Force (CFATF).
That date was given so that all documents could have been reviewed and assessed for relevance and appropriateness by the CFATF.  These findings will then be translated into Spanish and issued to the 28 other countries so that at the November 2013 plenary in the Bahamas, the plenary will decide on Guyana’s efforts to address these deficiencies.
Pointing out that the FIU is an Administrative Model FIU as defined by CFATF, it is an autonomous body as defined in the AMLCFT Act of 2009.  He provided a brief history of the FIU and the draft Bill that is before the parliamentary Special Select Committee.
Geer emphasized that the FIU operates in accordance with international fixed procedures set out by FATF recommendations. The body gathers intelligence from various reporting entities such as commercial banks, cambios, money transfer agencies and other authorities and entities. The intelligence information is available to law enforcement that are tasked with investigations and converting this intelligence into evidence which can then be used for prosecution. This information must be associated with a serious or predicate crime to constitute money laundering.
He said that when CFATF, in the person of sister countries, visited Guyana in January 2010 one person was employed in the operations of the FIU. That has since changed with five additional staff. The report from that evaluation was presented to Guyana 18 months later in July 2011. Guyana responded to the deficiencies in November 2011. Geer said that Guyana responded to the deficiencies again in May 2012 and semi-annually since.
“At that point in time most of the deficiencies were directly associated to the flaws in the 2009 Act…And, by November 2012 it was confirmed by CFATF that 90 percent of the deficiencies were related to legal amendments,” he said.
The AMLCFT 2009 Act and Amendment Bill 2013 were guided by the FATF 49 recommendations and tailored to be relevant to Guyana’s laws. The draft Bill with amendments was presented to the National Assembly in April. The amendments were done to tighten the Act, making it more specific to close weaknesses in the country’s laws as identified by the CFATF, he noted.
The National Assembly controlled by the Opposition wanted to scrutinize the draft Bill and sent it to a Special Select Committee. But, because of political dramas with walkouts from the Committee by Opposition Members of Parliament nothing has happened to the Bill.
Government and the body’s hope of having the Bill amended in time for May 27, 2013 deadline when Guyana was expected to present its Act and relevant documents to CFATF were shattered. However, a new deadline of August 26 was given by CFATF. Again, Guyana failed to meet this deadline and already two countries have raised their brows at Guyana.
According to Roger Hernandez, Financial Advisor of CFATF, Guyana’s position in relation to CFATF’s requirements is being assessed in preparation for a report which will be presented at the CFATF Plenary in The Bahamas in November 2013.
He said, “If Guyana does not take specific steps by November 2013, then the CFATF will identify Guyana as not taking sufficient steps to address its AML/CFT deficiencies and will take the additional steps of calling upon its Members to consider implementing counter measures to protect their financial systems from the ongoing money laundering and terrorist financing risks emanating from Guyana, and at that time CFATF will consider referring Guyana to the Financial Action Task Force International Cooperation Review Group (FATF ICRG).”
He noted that the period of blacklisting will depend on the country’s ability to implement the requisite remedial measures in as short a period as it can. These measures will then have to be assessed for compliance and only when these assessments have indicated that the deficiencies of the law have been sufficiently addressed will a recommendation be made for Guyana to be removed from any list.
Please be advised that it has been the experience that the minimal period for removal is approximately two years, he said.
He said that if Guyana is blacklisted, countries will be required to implement counter measures against Guyana to protect their financial systems.  Such measures could range from outright prohibition on financial institutions dealing with transactions from customers or corporations from Guyana, to the imposition of stringent requirements for handling such transactions.
Hernandez explained, “Either way these measures will have a detrimental effect on the economy. The immediate impact will be felt in the financial sector and the country’s trade. And will then ripple through the rest of the economy.
“Additionally, it will affect Guyana’s ability to access funds in the international market, and deter foreign investors due to the restrictions on financial institutions dealing with the country. Technical aid and assistance will also be affected as donor organisations have said that they will take note of such listing.”

 

 

---

---