Two weeks ago, we discussed the latest position with regard to the proposed amendments to the Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) Act. The Government wants an urgent passage of the amendments as presented on the grounds that they addressed all the concerns of the CFATF; and if the amendments were not approved before 13 February 2014 (the date when the Financial Action Task Force met), Guyana would be blacklisted. Fortunately, FATF did not review Guyana at that meeting but agreed that the Caribbean Financial Action Task Force (CFATF) would do so when it meets in May 2014. CFATF gave Guyana a deadline of 28 February 2014 to submit a report outlining its efforts to address the deficiencies identified in the Act.
APNU is insisting on a more comprehensive review of the legislation in view of the particular problems Guyana is facing, especially as regards the country being a transshipment point for cocaine destined for North America, Europe and the Caribbean. In addition, money laundering is linked to trafficking in drugs, firearms and persons as well as corruption and fraud; and appears to prop up the economy. APNU is also tying support for the amendments in exchange for the President assenting all outstanding Bills that the National Assembly had passed.
The AFC made it clear that it would withhold support for the amendments unless the Government takes concrete measures to activate the Public Procurement Commission. It argued that the proceeds from corrupt activities facilitate money laundering; the work of the Commission is likely to reduce significantly the perception about the levels of corruption in Guyana; and the same urgency is needed for the appointment of the members of the Commission.
Although the Parliamentary Select Committee appeared to have reached some agreement based on the concerns raised by the combined Opposition, a number of contentious issues remained unresolved. These include: (a) empowering the Police and the Customs Anti-Narcotic Unit to seize sums in excess of $2 million in cash in the possession of any individual suspected of committing a financial crime; (b) involving the Assembly in the appointment of the FIU Director; (c) removing what APNU considers the excessive powers in the hands of the Minister of Finance and the Attorney General in connection with seizures; and (d) creating an Anti-Money Laundering Authority.
Results of meeting with CFATF official
The Select Committee met with CFATF’s Financial Advisor, Mr. Hernandez, to clarify that organisation’s position with regard to the amendments. He had previously stated that CFATF did not dictate the contents. Rather, the Government had sent the amendments to it for comments, and those comments were provided. He urged swift passage of the amendments as proposed by the Government because “tinkering with them can pose greater risks”. Mr. Hernandez explained that CFATF had already considered the other aspects of the Act and that any changes to them could result in Guyana not being compliant with the international standards. He also referred to the possibility of Guyana being blacklisted if the deficiencies identified are not promptly addressed when FATF meets in June 2014. Mr. Hernandez emphasized that it is not just a matter of passing the legislation but one of ensuring effective implementation. The latest CFATF review had revealed that many of the requirements of the original legislation had not been implemented, especially as regards the operations of the Financial Intelligence Unit (FIU), which is the backbone of the Act.
APNU is insisting that, despite CFATF’s concern about the risks associated with extending the amendments of other areas of the legislation, it will still go ahead with a comprehensive review; and it is convinced that the additional amendments it is proposing could be made without the risk of CFATF rejecting them. In particular, the Bank of Guyana, the FIU, the Special Organised Crime Unit, and the Office of the Director of Public Prosecutions need to be adequately equipped and provided with the desired level of autonomy to effectively discharge the functions assigned to them by the Act.
APNU also considers that the amendments the CFTAF has agreed to, represents a minimum position and that the additional amendments would make the Act stronger. Mr. Hernandez appears to have accepted APNU’s position when he stated that nothing stops the Legislature from making additional amendments and that the final decision rests with that body. APNU also stated that it would not support the amendments unless the President assents to the outstanding Bills that the Assembly had approved some time ago. In the case of the AFC, the establishment of the Public Procurement Commission is its main concern. It nevertheless indicated that it would also support APNU’s demands. The Government had suggested that the Assembly approve of the amendments as is, with the understanding that APNU’s other concerns could be dealt with at a later stage. APNU, however, flatly rejected the proposal, contending that, in view of experience, the Government could not be trusted to keep its word. The President has since given an undertaking that a special committee would be set up to review the Bills that he had declined to assent to; and that steps would be taken to establish the Public Procurement Commission.
Latest position
The Government and the combined Opposition met on 26 February, but there was no agreement, as both sides stuck to their positions. The Government is insisting on the retention of Cabinet’s involvement in offering “no objection” to contracts to be awarded in excess of $15 million. However, the constitutional amendment of 2001 has removed the role of Cabinet in the procurement process. Therefore, in order to reinstate that role, there has to be a further amendment to the Constitution. This will require the votes of two-thirds of the elected members of the National Assembly – an extremely unlikely scenario.
The AFC has since proposed an amendment to the Procurement Act to provide for Cabinet to object to any proposed award of a contract but the Commission will have the final say, subject to appeal to a Tribunal and thence to the Courts.
The Select Committee was to have met on 27 February to consider the amendments just prior to the sitting of the Assembly to consider them. However, legal drafting of the amendments had not been completed, prompting the Assembly to defer consideration of the amendments to Wednesday. Meanwhile, Guyana has missed the 28 February deadline, and the implications of this are not clear. APNU suggested that missing the deadline by a few days would not hurt, considering that CFATF is not meeting until May 2014.
Conclusion
It is indeed very regrettable that the stalemate continues with regard to the passage of amendments to the AML/CFT Act, with little prospect of a compromise from our elected leaders. There is no doubt that there is merit in having strong legislation to deal with money laundering; and in tackling corruption in the award of public contracts through the establishment of the Public Procurement Commission. The issue, however, is one of timing and whether other aspects of the legislation should be addressed at a time when Guyana is faced with the gloomy prospect of blacklisting.
The Government’s offer to have its version of the amendments passed in the National Assembly, with a commitment that the other aspects of the legislation with which the Opposition has concerns, will be dealt with at a later stage, is not an unreasonable demand. However, there can be no denying that we have been extremely delinquent for several years now in ensuring that we have in place strong and effective legislation to deal with money laundering. Only when the “riot act” is read to us we have decided to do something about it.
The Government’s insistence that Cabinet should continue to be involved in the procurement process is to be viewed against the background that under this arrangement there are so many allegations of improper award of public contracts, sub-standard work being performed, undue delays, and overpayments to contractors. In addition, many public officials are flaunting unexplained wealth in front of our very eyes with impunity. The Government was also a party to the 2001 constitutional amendment that removed Cabinet’s involvement and placing it in the hands of a Commission. Regrettably, after 12 years, the Commission is yet to be established.
In the aftermath of the November 2011 elections, our political culture has changed from one of cooperation, compromise and trust; to one of resistance, confrontation and distrust. Our politicians are yet to come to terms with the reality of the new dispensation. The citizens of this country have placed the management of affairs of the State in the hands of one political group. At the same time, they provide some measure of checks and balances on the Executive through control of the Legislature by the other political group, albeit in combined form. This is unprecedented in the history of this country. In a display of political maturity and wisdom, our leaders must rise to the challenge, and in the spirit of goodwill and compromise do what is best for the country.
The stalemate as regards the proposed amendments to the AML/CFT Act represents collateral damage arising out of a bigger issue with which we are yet to come to grips – putting the public interest first. It is not too late to do so.
