Caribbean & Central America - November 2014 (ISSN 1741-4458)

In November last year, Guyana was referred to the Financial Action Task Force (FATF) for missing an anti-money laundering (AML) compliance deadline. It faced the prospect of international blacklisting, but the FATF has given it a further year to get its house in order.

Guyana’s problems stem from its domestic political impasse, whereby the November 2011 general election delivered a People’s Progressive Party/Civic Administration (PPP/C) executive president (Donald Ramotar) but gave the opposition APNU (A Partnership for National Unity) and the Alliance for Change (AFC) a one-seat parliamentary majority. The opposition has blocked the passage of the Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) Bill, support for which the opposition has linked to a variety of unrelated political demands.

The regional Caribbean Financial Action Task Force (CFATF) first drew attention to Guyana’s shortcomings in November 2011. In May 2013, it issued a public statement encouraging Guyana to rectify its shortcomings. And in November 2013 it issued a further public statement calling on its members to consider implementing counter measures to protect their financial systems from risks emanating from Guyana. Then in May 2014, the CFATF asked members “to implement further counter measures” in order “to protect their financial systems from the ongoing money laundering and terrorist financing risks emanating from Guyana.” The CFATF also referred Guyana to the FATF.

The counter measures recommended by the CFATF to be taken by members included enhanced due diligence measures, enhanced reporting mechanisms for financial transactions, refusing the establishment of subsidiaries or representative offices in Guyana, and “limiting the business relationships or financial transactions” with Guyana.

The CFATF continues to ask Guyana “to urgently, immediately and meaningfully address its AML/CFT deficiencies, in particular by: 1) fully criminalizing money laundering and terrorist financing offences, 2) addressing all the requirements on beneficial ownership, 3) strengthening the requirements for suspicious transaction reporting, international cooperation, and the freezing and confiscation of terrorist assets, and 4) fully implementing the UN conventions.”

Ahead of a meeting of the FATF in Paris from 18-24 October, Guyana’s Attorney General Anil Nandlall warned that the country was still at risk of international blacklisting. Nandlall warned that Guyana was on the “precipice” as a consequence of APNU holding up the bill in a select committee under its chairmanship – and of its “exorbitant political ransom”. According to Nandlall, Guyana is the only country in the Western Hemisphere that is still technically deficient in terms of its financial crimes’ legislation.

Thankfully for Guyana, at its October meeting in Paris the FATF chose to be understanding, issuing a statement saying that Guyana had “made a high-level political commitment to work with the FATF and CFATF to address its strategic AML/CFT deficiencies”. What it didn’t say, however, was how the Guyanese government intended to finesse its domestic political difficulties. But the government does at least have some breathing space. According to the head of the presidential secretariat, Dr Roger Luncheon, the likely new deadline for Guyana to comply with the FATF demands is September 2015.

• “Guyana’s problems stem from its domestic political impasse, whereby the November 2011 general election delivered a People’s Progressive Party/Civic Administration (PPP/C) executive president (Donald Ramotar) but gave the opposition APNU (A Partnership for National Unity) and the Alliance for Change (AFC) a one-seat parliamentary majority. The opposition has blocked the passage of the Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) Bill, support for which the opposition has linked to a variety of unrelated political demands.”