Money laundering humungous problem, threatened sanctions aren’t – Clive Thomas

Money laundering remains a huge problem here that requires serious action from lawmakers according to renowned economist Dr Clive Thomas who also said that the sanctions Guyana could face for not complying with law reforms are “not really serious threats”.

“I think what they are after is the big fish,” he told a packed meeting at the Tower Hotel last evening during a symposium organised by the WPA to mark the 33rd anniversary of the assassination of Dr. Walter Rodney. The Anti-Money Laundering/ Combating the Financing of Terrorism (AML/CFT) Bill 2013 was one of the topics discussed and Thomas as well as consultant Raymond Gaskin also focused on the 2009 Act which was deemed as flawed.

Dr Clive Thomas
Dr Clive Thomas

Sharing the view that Guyana is awash with laundered money, the duo pointed out that the 2009 Act has not resulted in prosecutions or seizures of assets. Gaskin, particularly, using examples to support his position, argued that the Act was flawed citing the involvement of politicians in the process, functions which he said should be performed by the regulatory agency and law-enforcement authorities.

A special select committee of the National Assembly is currently considering the amendments to the AML/CFT Act.  Attorney General (AG) Anil Nandlall said on Wednesday that the Caribbean Financial Action Task Force (CFATF)  has set August 26th as the deadline for Guyana to submit anti-money laundering amendments if it wishes to be considered at the body’s next meeting in November.

During a meeting in Nicaragua last month, the CFATF encouraged Guyana to urgently approve and implement these legislative amendments. “If Guyana does not take specific steps by November 2013, then the CFATF will identify Guyana as not taking sufficient steps to address its AML/CFT deficiencies and will take the additional steps of calling upon its Members to consider implementing counter measures to protect their financial systems from the ongoing money laundering and terrorist financing risks emanating from Guyana, and at that time CFATF will consider referring Guyana to the Financial Action Task Force Inter-national Cooperation Review Group (FATF ICRG),” a statement from the Trinidad-based body had said.

Before last month’s meeting, government was unable to convince the opposition-controlled National Assembly to pass the amendments. The opposition had argued that the need more time to study the legislation given its complex nature while the AFC also wanted government to re-consider Bills passed by the opposition and set up a Public Procurement Commission.


Last evening, Opposition Leader David Granger said that they are seeking a good Act that is enforceable and one that deals with the concerns raised. “We’re not in any hurry to pass the amendments,” he said while urging persons to make submissions to the parliamentary committee. One of the concerns raised was that the committee was not accepting oral submissions with the view being posited that a lot of persons who want to make submissions are being excluded because oral testimony is not being taken.

Thomas, in his presentation, said that money laundering is a “humongous” problem in Guyana and noted the various ways in which it is laundered such as auto dealerships and stage shows. “The underground economy is everywhere in Guyana,” he said while pointing out that this has a negative impact on the economy including growth and financial stability.

Echoing some of Gaskin’s views on the 2009 Act, Thomas said: “we cannot absolve ourselves from some of the blame in allowing that Bill to pass unanimously.” Apart from Granger, a few other parliamentarians from the opposition parties were present though none from government was seen and a wide cross-section of civil society was in attendance.

Thomas said that Guyana is faced with criminalization of the state with the state becoming a principal vehicle for the accumulation of wealth.

Should Guyana fail to pass the amendments, he suggested that the country could face increased surveillance of financial activities but non-launderers would have nothing to fear. He said that the states pushing the legislation really want to track movements in Europe and North America and later said that likely sanctions “are not really serious threats in that sense.” The professor said that he does not believe that small business will be affected as their income would be relatively small but it is really the big fishes that are being pursued.

The economist said that government has a political interest in making it seem as though it will be an impediment to business but he does not know of any small business that is involved in money-laundering in a significant way. He had noted that in the Caribbean, the origins of money laundering was centred in the offshore financial centres while in Guyana, it is centred in the development of organized crime.

He had said that the criminalized state is perpetrating the interest of organized crime behind the façade of legitimate business. He urged the lawmakers to take a broader look at the legislation and arrive at a correct decision and commit to action to pursue. It had been emphasized that little action was seen since the 2009 Act was implemented.

Earlier, Gaskin had urged the throwing-out of the 2009 Act based on what he said were provisions that were not in line with the constitution as well as the involvement of politicians in the process and the usurping of the functions of the regulatory agencies such as the Bank of Guyana. “Jam the whole thing, not only the amendments, jam the whole thing,” he exhorted. He cited several examples to support his argument that the Act was flawed such as the involvement of the Attorney-General and Minister of Finance in making decisions to blacklist persons with appeals being determined by the Finance Minister and, if unsuccessful, an appeal could then be made to a judge but eventually leads back to the Finance Minister. The manner of the appointment of the director of the Financial Intelligence Unit as well as the reporting requirements was highlighted.

Chartered Accountant Christopher Ram suggested that a Financial Services Commission could deal with the varying issues since the Bank of Guyana cannot regulate every single sector. He said that the nature of the economy has to be looked at, if money laundering is to be dealt with and also chided the political parties for not taking action as he noted that, except at election time, they do not fall under any law, and donations are not reported. “The question of money laundering is a question of law and order,” he said while urging that action be taken.

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