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Let me write your anti-money laundering legislation

Nov 23, 2013 Letters

 

DEAR EDITOR,
I note the political hysteria and the blame game surrounding Guyana’s non-compliance with the Caribbean Financial Action Task Force (CFATF) recommendations, along with allegations of the potential negative economic and financial impact that may result from being blacklisted.
Without adding to the hysteria and blame game, I wish to point out that Guyana is not the only non-compliant CFATF jurisdiction, as Belize was also noted as non-compliant.  I also wish to point out that the predictions of negative financial impact may be unfounded, and may not be as severe as is being suggested.
Instead, external financial institutions handling funds originating from Guyana may require additional verification of those funds. This extra scrutiny in itself is not a bad thing, considering the lack of domestic enforcement of the existing anti-money laundering (AML) legislation in Guyana, a non-functional Financial Intelligence Unit improperly placed within the Ministry of Finance, and Guyana’s reputation as narco-transshipment state (judging from the amount of vessels originating from Guyana with cocaine that has been intercepted internationally).
Countries are routinely added and removed from the Financial Action Task Force (FATF) list of non-compliant jurisdictions. Nigeria and Morocco were recently removed.  Guyana will soon join the following countries which the FATF will be working with to address identified deficiencies: Afghanistan, Albania, Angola, Antigua and Barbuda, Argentina, Bangladesh, Cambodia, Cuba, Iraq, Kuwait, Kyrgyzstan, Lao PDR, Namibia, Nepal, Nicaragua, Sudan, Tajikistan, Vietnam and Zimbabwe.
If Guyana fails to eventually get its act together, then it runs the risk of being listed by FATF as a high risk non-compliant country and will join the following high risk jurisdictions: North Korea, Ecuador, Ethiopia, Indonesia, Kenya, Myanmar, Pakistan, Syria, Tanzania, Turkey, North Korea and Yemen.
The FATF recommendations are not unique to Guyana. Deficient countries are routinely provided with recommendations from their respective regional groups, such as CFATF, to bring their AML legislation to international standards along the FATF recommendations.  As a result of the standardization of AML legislation, I am doubtful that the political opposition could find much to argue with the CFATF recommendations.
Accordingly, the tactics of the political opposition has to be viewed in a larger context, namely non-cooperation and retaliation for the President’s non-assent of previously passed opposition-piloted bills and the government’s insistence in maintaining a final say in proposed procurement legislation.   The failure to pass the AML legislation is the result of raw, political brinksmanship being played out.
I have closely followed the events leading up to the defeat of the AML legislation in the assembly and have noted the opposition complaints.   However, I am yet to see any substantive proposals from the opposition as to what they want to add or remove from the now defeated draft bill.
As someone who has studied AML/Anti-Terrorist Financing legislation worldwide, who is currently completing an LLM in this field, and who has written an LLM paper on the US Bank Secrecy Act, which is the US AML legislation, and who has analysed the structure and function of the FINRA, the US Financial Intelligence Unit, I invite the government and the opposition to provide me with their draft proposals, and I will respond with a draft legislation which may be acceptable domestically and also comply with FATF recommendations.   All free of charge.
Oudit N. Rai B.A., M.A., LL.B
Former Deputy Judge

 

 

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