Local bankers and manufacturers are the latest groups to appeal for political unity for the urgent amendment of the anti-money laundering laws, while warning that possible sanctions for failure to act could put a squeeze on bank transactions and cause the contraction of the business sector.
It has been argued by the government and civil society groups that if the Anti-Money Laundering and Countering the Financing of Terrorism (Amendment) (AML/CFT) Bill is not passed by next month, Guyana would be blacklisted by the Caribbean Financial Action Task Force (CFATF) and a host of financial transactions will be jeopardised.
“We the members of the Guyana Association of Bankers remain concerned with the potential consequences of being blacklisted should Guyana fail to adequately demonstrate pro-gress in implementation of recommendations of the CFATF including amendment of its AML/CFT legislation prior to the country review in November,” the association said in an advertisement published in yesterday’s Stabroek News.
The association said the transactions likely to be affected by the absence of the amended law include bank to bank relationships, access to foreign exchange, money transfers and the issuance of letters of credit.
It called on “all stakeholders to take urgent action” to implement the CFATF recommendations, including the passage of the amendment bill.
The association comprises the Bank of Baroda (Guyana) Inc, Citizens Bank Guyana Inc, Demerara Bank Ltd, Guyana Bank for Trade and Industry, Republic Bank Guyana and the Bank of Nova Scotia.
The main opposition coalition APNU says it has a series of amendments to the bill to make the infrastructure under the Act more effective, while the AFC has identified the set up of the Public Procure-ment Commission and the assent of two opposition bills as preconditions for parliamentary support. The opposition has also argued that the government had been warned over a number of years by the CFATF about the jeopardy that the country faced over non-compliance and did nothing about it.
The Guyana Manufac-turing and Services Association (GMSA) also sounded its concern in a full page advertisement published in yesterday’s newspapers.
“To date some foreign financial service firms have already withdrawn their services from Guyana rather than be tainted by association and suffer a decline in their own share prices,” the GMSA said.
It did not specify the institutions that have withdrawn their services but said they included “foreign (including Caribbean) banks and financial institutions that facilitate wire transfers.”
Since the possibility of sanctions became apparent, the Private Sector Commission (PSC) has spearheaded a call for an agreement so that Guyana could be found sufficiently compliant next month.
GMSA noted that Guyana has less than a month to satisfy the CFATF recommendations, which include adequately criminalising terrorist financing, and ensuring a fully operational and effectively functioning Financial Intelligence Unit (FIU) or it would be black or grey listed.
In addition to capital flight, the GMSA warned that if blacklisted Guyana faces capital flight, debilitating economic damage and isolation, sizable costs associated with reforming banking laws, regional and global marketing/networking, product rebranding and corporate restricting; damaged international reputation as an investment location; revision of client/customer listings owing to inevitable loss of confidence in our companies’ ability to satisfy overseas market demand, or pay for imports; and severed wire transfer services.
“Blacklisting will most definitely wreck our internationally-connected enterprises across the spectrum, from manufacturing to tourism, Information Technology services, and general international connectivity and cross border trade in goods or services,” GMSA said.
Guyana appeared before the CFATF in May of this year and was found wanting, but the country was able to secure an extension. Guyana will now be assessed again in November but the country may already be in hot water since it failed to submit documents stating that it had at least passed the AML/CFT bill by an August deadline that was recommended.
Some amount of progress was seen this week since the Special Select Committee charged with considering the bill concluded its work on Tuesday, and the bill will be re-tabled in the National Assembly for passage soon.
However, the decision to conclude the work was taken by the government representatives on the committee in the absence of the opposition representatives.
Both the AFC and APNU have since made their displeasure at this development public and there is not much optimism that the opposition parties will vote to pass the bill when it returns to the house.