So, what is the extent of money laundering?

In his address to the annual awards ceremony of the Guyana Manufacturing and Services Association (GMSA), two Saturdays ago President Jagdeo challenged the widely held belief that a significant part of the economy is being buttressed by laundered money. He referred to a statement made by a member of the private sector that 80% of the economy was based on drug money.

“I don’t have a problem with anyone making that assertion”, the President said, adding however that when the annual US State Department Report on the narcotics trade and laundering had been published he had called the US embassy and asked how the figure contained in that report had been estimated but was still to receive the methodology.

“The wild assertions are not enough”, the President thundered adding that in 2006 there was an inflow of US$1.02B inclusive of remittances and “I don’t have here a line called drug money”.

We agree that wild assertions are not acceptable but perhaps amid the friendly and warm environment in which he made his declaration President Jagdeo might have forgotten that he is yet to tell the country what he knows of the extent of money laundering in the country. Is it 80% of the economy? The President says no. Is it 60%, 50%, 10%? Or doesn’t he know or want to know?

And that is the crux of the matter. As long as the President and his government continue to deny that there is a money laundering problem it will always be the elephant in the room and any number of persons will essay attempts at determining its size and characteristics.

In countries like Guyana which have unwittingly and unwillingly become intermediaries in the supply of cocaine, the onus is on the state to determine the extent of the problem and to craft solutions. It is not the role of the US State Department or the US embassy or the businessman at the private gathering.

This is where the President’s attempt to denounce the money laundering argument amounts to mere bluster and rhetoric. His governments – he has now been President for nine years – have abjectly failed to install the legislative and enforcement machinery needed to effectively crack down on the drug trade. The result has been that conditions enabling the drug trade and money laundering have thrived. The numerous edifices that have sprung up around the retail, sport and other sectors beg the question of how the size of their investments could be matched with the low growth economy and generally depressed business.

Two years after he became President, the Money Laundering Act was passed in 2000. Five years after the passage of that Act, the government was still promising the full operationalisation of the Financial Intelligence Unit (FIU) provided for under the Act and pledging to implement the necessary regulations, staff the unit with the required experts and make it an autonomous agency.

2007 is now drawing to a close and the government is still to live up to its promise to replace the still-born 2000 Act with a new one which caters for asset seizure and forfeiture. Can this government really be serious about finding out about the extent of money laundering and acting against it?

There has not been a single prosecution under the 2000 Act and the FIU has never been heard from or the fruit of its labours presented to the public. And there is no doubt that the drug trade has flourished and that the fight against it is being waged at US and other foreign ports and in courtrooms in the US and further afield, but not in Georgetown. The evidence is there in the cargoes of cocaine that have been seized abroad after being shipped from Guyana in a variety of now famous containers: timber, rice, coconuts, molasses, fish, etc. The evidence is also there in the courtroom deliberations and revelations mainly in New York.

It was only on Thursday that the Acting Crime Chief made bold to say that the police believed that indicted businessman Roger Khan had been involved in drug trafficking. Over that period of time did the government and its FIU ever try to determine whether Mr Khan’s business operations here had legitimate underpinnings? Or gather evidence against him while he allegedly assisted in the crime fight? Did it do this for any of the other business persons held in connection with drugs? Thus far, the government’s fight against drugs has been a sham.

There is also another serious consequence of this dereliction of duty and insouciance. The last 10 years or so have been littered with inexplicable killings and other bloody violence more than likely the result of narco-terrorism. The unwillingness to act against the drug trade may have brought ephemeral benefits in the form of money pumped into the economy, but it has also exacted much violence, bloodshed and death.

The public awaits the swift activation and enlivening of the new money laundering legislation.

Around the Web

Comments