Caribbean Financial Action Task Force blacklists Guyana

The Caribbean Financial Action Task Force (CFATF) has blacklisted Guyana after the Caribbean Community (CARICOM) country failed to approve legislation to combat money laundering and countering the financing of terrorism (AML/CFT).

A statement posted on the CFATF website, notes that in November 2011, it had brought to the attention of members, including Guyana, that there were “significant strategic deficiencies in their AML/CFT regime”.

CTAFT said that in the effort to encourage  the “expeditious rectification of the identified strategic deficiencies”, it had developed with Guyana an Action Plan with identified target dates to address the strategic deficiencies that exist to combat money laundering and the financing of terrorism.

“As a result of not meeting the agreed timelines in its Action Plan, the CFATF issued a public statement in May 2013 recommending that Guyana take steps to ensure that it addressed its AML/CFT deficiencies. “Guyana has made efforts to address its deficiencies, however, it has not taken sufficient steps towards improving its AML/CFT compliance regime by failing to approve and implement required legislative reforms”

CFATF said that Guyana must therefore pass the relevant legislation and implement all the outstanding issues within its Action Plan including fully criminalising money laundering and terrorist financing offences, as well as addressing all the requirements on beneficial ownership.

In addition, it said Guyana must strengthen the requirements for suspicious transaction reporting, international co-operation, and the freezing and confiscation of terrorist assets, and fully implementing the UN conventions.

“Members are therefore called upon to consider implementing counter measures to protect their financial systems from the ongoing money laundering and terrorist financing risks emanating from Guyana,” the CFATF statement said.

In an immediate reaction President Donald Ramotar has accused the opposition groups – A Partnership for National unity (APNU) and the Alliance for Change (AFC) - which controls a one-seat majority in the 65-member National Assembly for Guyana being blacklisted.

He said while he has not read the full CFATF statement, he was disappointed with the position taken by the opposition even though they were fully cognisant of the implications.

“One can only conclude that this was a deliberate attempt to damage the social and economic development of our country,” President Ramotar said.

Government officials said as a result of being blacklisted, Guyana stands to face impediments with remittances from money transfer agencies and securing, fire, life and mortgage insurance services and with the transfer of money from local to external banks.

Additionally, the aviation and business sectors that depend on the flow of goods and services from overseas could also face challenges while government workers overseas and scholarship students who depend on a salaries and regular stipends are likely to face delays, the officials said.

Prime Minister Samuel Hinds told legislators that the “experience of other jurisdictions so blacklisted by CFATF or by their geographic FATF (Financial Action Task Force), leaves no doubt that like them, Guyana will be severely affected.

“This will place Guyana’s financial banking and insurance sector under severe scrutiny with serious consequences for financial transactions for consumers, businesses …and the government’s provision of services.”

Earlier this month, the opposition legislators withheld their support for the passage of the Anti-Money Laundering and Countering the Financing of Terrorism Bill despite having agreed six months ago for the legislation to go before a special select committee.

Guyana had been given a November 18 deadline by the CAFTF to make amendments to the existing legislation which was non-compliant with the sweeping reforms taking place regionally and internationally to fight money laundering and terrorism.

APNU member and a former finance minister, Carl Greenidge, said the coalition, which includes the People’s National Congress Reform (OPNCR), wanted the bill to be recommitted to the special select committee to undergo more scrutiny.

He told legislators that APNU was not given enough time to make more alterations and amendments to the proposed legislation and was somewhat concerned that there should be more time allotted for public input.

Greenidge said the government had acted in bad faith by breaching the agreements made before the final meeting of the committee took place and expressed surprise that the Donald Ramotar government would put the legislation before Parliament without taking the concerns expressed by APNU seriously

Source: Caribbean 360

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Date Posted

November 25 2013