Private Sector rejects politically selected FIU

Mar 14, 2014 News

… Police currently unable to enforce the Anti Money Laundering Law – AG

The Private Sector Commission (PSC) has joined calls for the Financial Intelligence Unit (FIU) to be devoid of political influence, and as such, Guyana should adopt Barbados’ model for an Anti-Money Laundering Authority, but this has been stoutly rejected by none other than the Head of State, Donald Ramotar.

President Donald Ramotar signs the petition calling for timely passage of the AML/CFT Bill

The appeal came yesterday from PSC Chairman, Ronald Webster, at the International Conference Centre, which had a capacity audience, as President Ramotar held a public consultation over the non-passage of the Anti-Money Laundering and Countering the Financing of Terrorism Bill.
The attendance represented a broad cross-section of society, primary school-aged children in uniforms included, and scores had to be accommodated outside of the conference hall to watch the proceedings on large television screens.
Ramotar in his presentation chronicled the history of the recommendations by the Caribbean Financial Action Task Force (CFATF) which was submitted in 2011. He did concede that when the recommendations were received, Government did not immediately act on them because at the time they were preparing for elections.

PATRIOTISM NOT DEALS
According to Ramotar, it was in 2012 that the FIU secured the services of President of the Bar Association, Ronald Burch-Smith, to draft the Bill using the CFATF recommendations. That draft Bill was then sent to CFATF which gave its stamp of approval before government took it to Parliament.
Ramotar said that at that time he expected it to be a mere formality and did not expect the posturing adopted by the political opposition. The President said that his position is that when it comes to AML/CFT Bill, there is a need for patriotism and not for making deals.
When the floor was open to the public for questions or statements, Webster used the opportunity to make his submission. In directing his submission to Ramotar, he said that the Private Sector over the past two weeks held a number of meetings, both with government and opposition as well as other stakeholders, in an effort to seek compromise.

BARBADOS MODEL
Following its meetings, the PSC, he said, decided that it does not support a politically selected FIU.
He said that the Private Sector Commission had found favour with the Barbados model, which has an Authority in place that the FIU reports to. This Authority is made up of persons drawn from agencies involved directly or indirectly in managing the problems associated with money laundering and terrorism.
In giving a breakdown of Barbados’ model, Webster noted that the Chairperson of the Authority is drawn from the University of the West Indies and its deputy from the private sector.

The Head of State addressing the consultation at the International Conference Centre

He said that the other members of that 11-person Authority are the Solicitor General, the Commissioner of Police, the Comptroller of Customs, which in Guyana’s case would be the head of the Guyana Revenue Authority (GRA), the Supervisor of Insurance, the Registrar of Companies, the Central Bank of Barbados and two additional members drawn from the private sector who have expertise in banking and insurance.
In his appeal for the passage of the Bill, Webster lamented that a failure would result in “capital flows out of the country, a weakening of the currency, higher electricity rates problems with transfers and things of that nature”.
Webster warned that failure to pass the Bill, will bite, “it won’t bite now, it will bite later…we need to avoid this at all cost, we must avoid it.”
According to the Chairman of the Private Sector Commission, the issue is not about politics but the very lives of Guyanese.
Ramotar in response told Webster, he had heard that CFATF was beginning to have problems with the Barbadian model and what Government is looking to have passed is a CFATF-compliant Bill.
“My contention is that we have a Bill at the moment that CFATF has pronounced on and found it to be compliant, and that is the Bill we should pass, if there is any amendment to that it has to be within the framework of what CFATF,” according to Ramotar.

REFERENDUM
Another member of the forum questioned of the President: if the opposition is holding the fiscal future of the country to ransom as is intimated, what move will be taken to rectify the problem.
The individual asked too if the matter cannot be brought to the ultimate Parliament of the land, namely the electorate.
“Is there not a consideration for a referendum,” the individual asked, pointing to the fact that the last referendum in Guyana was held in 1978.
It was suggested that for more than 35 years there has not been a referendum in Guyana, which means that the voice of the citizenry has been removed from the critical decision-making process of the country.
This question was ignored by the President and other presenters, who included Junior Finance Minister, Juan Edghill, who moderated the proceedings, substantive Finance Minister, Dr Ashni Singh and Minister of Legal Affairs, Anil Nandlall.

DRACONIAN LAW
Nandlall did respond to a question about the draconian nature of the legislation coupled with the fact that there has been no prosecution.
Nandlall conceded that the law is draconian and it was intended to be draconian because of who it targets, namely money launderers and terrorists.
“The world has come together and taken a decision to pass the most stringent possible law to deal with what the world regard as the worst set of social ills confronting today’s world,” said Nandlall.
Responding to the fact that there have been no prosecutions in Guyana, Nandlall conceded and said that this is also true across the Caribbean.
According to Nandlall, this is a new body of law that has been promulgated with Guyana first receiving it in 2009. He said that the law is radically different from any other piece of criminal legislation in existence.
“It deals with the tracing of money through a financial sector…that is always a very difficult and elusive object, the tracing of money.”
He elaborated that this has been rendered even more difficult with the advances of technology.

POLICE UNABLE
According to Nandlall, “it is an extremely difficult offence to gather evidence, in relation to and more so to prove, satisfy the criminal standards of establishing guilt beyond a reasonable doubt.”
He said that it is for this reason that CFATF reviewed every country in the Caribbean because there was one common problem, in that the legislation was not yielding any convictions.
According to Nandlall, this is precisely why CFATF recommended, in addition to the legislative measures, the strengthening of the law enforcement aspect of the anti-money laundering regime.
He drew reference to the President’s statement in relation to the setting up of a specific unit to deal with specialized organised crime.
Nandlall said that it was discovered by the CFATF that the police in their current construct and training have been unable to enforce the law because of its complexity and its very nature.