Latin American Dialogue’s, Latin American Advisor asked Diaz Reus: “Why has Guyana failed to pass an anti-money laundering bill?” The Caribbean Community Secretariat in February expressed concern at Guyana’s failure to pass its Anti-Money Laundering and Countering the Financing of Terrorism Act, a measure that the secretary general of the Organization of American States has also called upon Guyana to approve. The Caribbean Financial Action Task Force has blacklisted the country over the matter. What does the legislation aim to achieve, and why is it being resisted? How will the wrangling affect financial services companies in Guyana and the country’s economy overall? Is Guyana’s inaction a blow to coordinating anti-money laundering efforts and the Caribbean?
Diaz Reus’ Response:
“The Caribbean Financial Action Task Force (CFATF) has blacklisted Guyana due to AML/CFT deficiencies and threatened further sanctions, unless the government implements needed legislative changes. Because Guyana’s historically weak criminal justice system has also contributed to a favorable climate for drug trafficking, smuggling, human trafficking and corruption, crimes that have a propensity of generating large amounts of illegal profits, CFATF has taken a firmer stance with Guyana. As a result, CFATF has been working with Guyana to implement an action plan with target dates to address the AML/CFT deficiencies that still existing despite Guyana’s first AML/CFT Act of 2009. Due to a political dispute between political parties, however, the amended bill, which would have addressed these deficiencies, has been held up in Parliament because of the political parties’ failure to agree on various amendments to the law. These include restructuring the Financial Intelligence Unit and setting the monetary thresholds needed in order for seizures to occur. The failure to pass these needed reforms before the May CFATF Plenary Meeting would lead to serious sanctions. This would be devastating to Guyana’s financial services industry, potentially causing international banks to terminate their relationships with Guyanese counterparts. It would also cause other countries to bring greater scrutiny to bear on funds originating in Guyana. For a country whose industry is largely dependent on exporting natural resources, these sanctions could easily cripple the economy, as purchasers for their exports face greater challenges in conducting financial transactions with Guyana.”
To read the full April 3, 2014 Q&A discussion, go to www.thedialogue.org or download the PDF here.