Call made for political parties to come under ambit of anti-money laundering law

Political parties should be included under the ambit of new anti-money laundering laws, Accountant Christopher Ram has urged a parliamentary committee.

“Political parties are practically exempt from most, and are subject to few laws, a fact evidently not consistent with the rule of law or the democratic polity of Guyana. Political parties obviously raise substantial sums of money that are not properly accounted for. They should therefore be included in the Schedule of entities subject to the Act,” he told the parliamentary committee currently examining the Anti-Money Laundering and Countering the Financing of Terrorism (Amendment) Bill.

Political parties were expected to meet yesterday and today to finalise the AML/CFT Bill, ahead of a parliamentary sitting tomorrow. Main opposition coalition APNU has pledged its cooperation in the committee but also recently demanded that President Donald Ramotar assents to or commits to a process to assent to bills he has turned away as a condition for its support. The AFC says that the establishment of the Public Procurement Commission is a prerequisite for its support of the bill, thus APNU’s votes are crucial if government hopes to pass the amendment bill tomorrow, two days before a meeting of the Financial Action Task Force (FATF) in Paris.

Guyana has missed two deadlines set by the Caribbean Financial Act-ion Task Force (CFATF) to have adequate legislation passed and as a result the group has urged its members to consider implementing measures to insulate themselves against financial risks emanating from the country. On Friday, the Western missions urged cooperation by all parties to finalise the anti-money laundering amendment bill, while warning that serious consequences would result from the country being blacklisted by the FATF.

Ram, in his submission to the parliamentary committee, pointed out that to promote their objectives including competing in elections campaigns, political parties must raise considerable sums of money without any obligation to disclose their source of income, even to their own members. “Such sources could include terrorist groups, narcotics-traffickers, persons engaged in trafficking in persons, bribing of officials and in other serious crimes. While politically exposed persons fall within the groups to which reporting entities are required to pay particular attention, neither they nor their parties are included (in the) First Schedule as a reporting entity,” he noted.

“Given the level of cash transactions in which the Guyana society and no doubt political parties are engaged, the existing provisions that imposes some restraint solely or mainly at the banking level would be both inadequate and ineffective,” he said.

Ram, who is also an attorney, pointed out that the First Schedule of the Act includes used car dealers, car part dealers, dealers in real estate, registered charities and co-operatives. These entities are customers to financial institutions and are also listed as reporting entities with the duty to establish and maintain records in a prescribed format and report suspicious transactions under the law, he noted.

“I do not believe that the law should impose greater obligations on used car dealers and real estate agents than it does on political parties,” he said while emphasizing that the absence of campaign financing legislation, or of any regulatory framework governing political parties, and the implications for the subverting of the country’s democratic process, make the inclusion of political parties as reporting entities vital.

“My specific recommendation therefore, is that political parties be added to Schedule 1 and that Gecom be made the Supervisory Authority,” he said.

Ram added that to the suggestion that political parties are non-entities, he would respond that “legal form is less important than the activity; that representatives of political parties make up the country’s law making body; and that even now, they appoint agents contrary to the legal maxim that there can be no agent without a principal.”

“Apart from removing the risks to the democratic process and of laundering and financing of terrorism by or through the political parties, the Select Committee made up entirely of representatives of political parties would be sending a clear message that they regard it as the duty of everyone, including themselves to join the effort to prevent Anti-Money Laundering and the Financing of Terrorism,” he asserted.

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