Chartered accountant Christopher Ram is proposing the adoption of Barbados’ anti-money laundering legislation, including the creation of an Anti-Money Laundering Authority, to break the current impasse over the reform of the law and make the country fully compliant with its international obligations.
In addition to repealing the Anti-Money Launder-ing and Combatting the Financing of Terrorism Act of 2009 and replacing it with the Barbados legislation, Ram also says that the Donald Ramotar administration and the National Assembly should agree on an “unambiguous timeline” for the operationalising of key oversight bodies, like the long delayed Public Procurement Commission (PPC).
Ram’s proposals, published on his ChrisRam.net blog, have come in the wake of a leading member of the government seeking his views on a way out of the parliamentary impasse on the amendments to the law that the government has been trying to get past the National Assembly since April.
As a result of the government’s failure to enact amendments to the law that were previously recommended, the Caribbean Financial Action Task Force (CFATF) last month issued a call to its members to consider implementing measures to insulate themselves against financial risks emanating from Guyana, saying the country failed to take sufficient steps to reform its anti-money laundering deficiencies. CFATF made the announcement of Guyana’s status in a public statement after the end of its 38th Plenary in Freeport, Bahamas, last month.
Ram, who is also an attorney, warns that the CFATF finding leaves “a narrow window” of a few months before the country becomes “the object of heightened scrutiny and possible condemnation by the international Financial Action Task Force.” The Financial Action Task Force (FATF), of which the CFATF is an affiliate, will have its next Plenary Meeting in February 2014, and at that meeting, independent of CFATF, it can select Guyana for review by the International Co-operation Review Group and could lead to calls for the application of measures against the country.
“I hope that all parties to move expeditiously and simultaneously on all these matters and spare Guyana the embarrassment and consequences of being labelled an international pariah.
This is the season of goodwill. Let it also be a season for commonsense, patriotism and compromise,” he says.
According to Ram, government’s spokespersons have simply stated that the proposed amendments are what the CFATF has called for, while the opposition parties and civil society have expressed concerns not only about the proposed amendments—which may be unconstitutional—but about some of the provisions in the current legislation— the absence of a strong executing authority and the role of political operatives in the administration of the act being among the objections.
Ram says that after reviewing a sample of the regional statutory framework, he is satisfied that there is no single model which the CFATF prescribes for meeting the requirements of the 40 recommendations and nine Special Recommendations of the FATF.
Ram adds that he is also satisfied about the validity of many of the concerns about the amendments and he says there is a real possibility that even if they were to be passed with the support of one or both of the parliamentary opposition parties, there could be a challenge in the courts of the constitutionality of a number of provisions.
Consequently, Ram advises against taking “such unnecessary risks” and proposes that the National Assembly should consider scrapping the 2009 law, recall the proposed amendments and replace both with the Barbados’ 2011 legislation, which he says “fully complies” with all the recommendations of the FATF.
He suggests that there is precedence for the adoption of legislation from another territory, pointing out that the “flawed” 2009 law was itself “an imported product!”
He adds that Guyana benefited substantially from technical assistance from Trinidad and Tobago in connection with the introduction of Value-Added Tax in 2007.
“For those uncomfortable with the adoption of a Barbados-model legislation I would remind them that the Barbados Com-panies Act 1982 was a principal influence on the Companies Act 1991 of Guyana and that the Barbados Act was itself modelled after the Canadian Business Cor-porations Act,” he argues.
Ram also notes that the Barbados legislation establishes an Anti-Money Laundering Authority that is responsible for maintaining oversight of the national Anti-Money Laundering/Counter-Financing of Terrorism (AML/CFT) framework, instead of a single individual as is the case currently in Guyana. The authority, he explains, is made up of eleven members, drawn mainly from the key public sector agencies that relate directly to anti-money laundering activity, while the executive functions of the Authority are carried out by the Financial Intelligence Unit (FIU) headed by the Director and comprising other public officers.
Ram does suggest amendments to the Barbados law, including bringing the National Procurement and Tender Administration under the anti-money laundering authority. He also suggests the appointment and removal of the Executive Head be brought under the Public Accounts Commit-tee (PAC) or the Public Service Commission; and direct reporting to the National Assembly like in the case of the Auditor General’s Report.
He also says Guyana should seek technical help from Barbados and Trinidad and Tobago to formulate a strategy to exit its CFATF status.
In addition to adoption of the Barbados legislation and seeking help from Bridgetown and Trinidad and Tobago, Ram proposes that the Ramotar administration and the National Assembly agree on “an unambiguous timeline” to operationalise key oversight institutions. He identified the PPC, the Integrity Commission, the Office of the Ombudsman, the Local Government Commission and the Ethnic Relations Commission. He also notes the need for the naming of a date for local government elections. His suggestions in this regard are in recognition of his belief in the “validity of the concerns” expressed by the opposition and a call by the AFC for the PPC to be immediately set up.