Bill to repeal anti-money laundering authority has first reading

-caters for freezing order by court

Attorney General Basil Williams on Thursday  presented a bill to the National Assembly which would repeal the elaborate Anti-Money Laundering Authority which his government had legislated for in 2015 but which it was told in November last year would breach the country’s international obligations.

The Anti-Money Laundering and Countering the Finance of Terrorism (AML/CFT) (Amendment) 2018 seeks to strengthen the regime for combatting money laundering, terrorist financing and proliferation.

Once this bill becomes law, Guyana would be closer to satisfying the conditions that come under the Financial Action Task Force (FATF) as Clause 3 will satisfy Recommendation 2 of the task force’s 40 Recommendations. Recommendation 2 states that countries should designate an authority to have a co-ordination or other mechanism that is responsible for national anti-money laundering and countering the financing of terrorism and proliferation financing (AML/CFT/PF) policies.

According to the bill’s explanatory memorandum the effect of the substitution 7A of the Principal Act with a new 7A is the repeal of the AML/CFT Authority. The new section establishes the Anti-Money Laundering and Countering the Financing of Terrorism and Proliferation Financing National Co-ordination Committee. This committee, according to the new bill, will comprise the Attorney General and Minister of Legal Affairs, who will be the Chairperson, the Director of Public Prosecutions (DPP), the Governor of the Bank of Guyana, the Commissioner-General of the Guyana Revenue Authority, the Director of the Financial Intelligence Unit (FIU), the Head of the Special Organised Crime Unit, the General Manager of the Guyana Gold Board, the Commissioner of the Guyana Geology & Mines Commission, the Chairperson of the Guyana Securities Council, the Chairperson of the Gaming Authority and the Chief Co-operatives and Development Officer.

Some of the functions of this committee include developing national AML/CFT/PF policies informed by the risks identified by the recently completed National Risk Assessment (NRA) and to develop a national action plan which includes recommendations on effective mechanisms to enable the competent authorities in Guyana to co-operate and co-ordinate with each other concerning the development and implementation of policies and activities to combat money laundering terrorist financing and proliferation financing.

Clause 13 of the amendment bill says that no person or entity is to deal with the property of any listed person or entity. The Director of the FIU shall notify the DPP when a listed person or entity has assets in Guyana. The DPP shall immediately upon being notified (no later than five days) apply to a judge in chambers for a freezing order in respect of the funds or other assets of a listed person or entity and the judge shall immediately grant a freezing order.

However, the freezing action shall not prevent a person or entity from crediting the frozen account of a listed person or entity with interest or other earnings due on the frozen account or payments due under contracts, agreements or obligations that were concluded or arose before the account became a frozen account, or where person or entity receives funds transferred to the account. But this is subject to the contract not being related to any of the prohibited items, materials, equipment, goods, technologies, assistance, training, financial assistance, investment, brokering or services referred to in United Nations Security Council Resolution 2231 (2015).

Meantime, the new section 68G provides the procedure for the listed person or entity to be delisted and for unfreezing of frozen accounts. Another new section, 68H, provides for a listed person or entity to have access to frozen funds where the Minister of Legal Affairs has determined that it is for basic expenses including payment for foodstuff, rent or mortgage, medical treatment and legal services; but extraordinary expenses or the funds or other assets are subject to judicial, administrative or arbitral judgement.  And before giving access to frozen funds or other assets the Minister must notify the relevant United Nations Security Council Sanctions Committee.

The Director of the FIU is empowered under another new section, 681, to propose persons or entities to the 1718 Sanctions Committee and the Security Council for designation where the persons or entities meet the criteria for designation under the respective resolutions.

The most recent United States State Department’s International Narcotics Control Strategy Report (INCSR) listed Guyana as being among several Caribbean countries that have once again been listed as “Major Money Laundering” jurisdictions for 2017.

However, also among the almost 100 countries that were listed in this category were the United States, Canada, the United Kingdom and Italy.

Apart from Guyana, other Caribbean countries listed under the category are: Antigua and Barbuda; The Bahamas; Barbados; the British Virgin Islands; Dominica, the Dominican Republic; Haiti: Jamaica; Saint Lucia; Saint Vincent and the Grenadines; Suriname; and Trinidad and Tobago.

Weren’t in the loop

It was Williams who had on June 26th, 2015 successfully piloted the bill catering for the establishment of the authority.

When asked in April this year to explain the turn of events, he said that things were set in motion while government was occupying the opposition benches. According to him, at that time, they did not understand what was really happening. “We weren’t in the loop,” he said, before adding that having taken office and recognising the error made, government was now taking corrective action.

Williams stressed that as Guyana prepares for the next evaluation round, great caution must be exercised because “we never had a money laundering prosecution much less a conviction.” He said that having identified the main areas of risk, Guyana now has to coordinate and put money into those areas in time for the upcoming mutual evaluation. The evaluation is set for the 4th quarter of 2021 but the process is likely to start a year ahead of this time.

It was during an AML/CFT meeting here in Georgetown last November that Williams was told that the planned authority would be illegal and should not be proceeded with.

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