The Insurance Association of Guyana has called on Parliament to address the issues hindering the passage of the anti-money laundering bill as failure to do so puts at risk the integrity of the local financial sector.
The association comprises Assuria Life (Gy) Inc, Assuria General (Gy) Inc, Caricom General Insurance Company Inc, Demerara Mutual Fire Insurance Company Limited, Demerara Fire Insurance Company Limited, Diamond Fire and General Insurance Company Limited, GCIS Inc, Guyana Trinidad Mutual Fire and Life Group of Companies, Guyana Insurance Brokers Association, Hand in Hand Mutual Fire Insurance Company Limited, Hand in Hand Mutual Life Assurance Company Limited, North American Fire Insurance Company Limited, North American Life Insurance Company Limited and United Insurance Company Limited.
The association members urged members of parliament to urgently consider the ramifications of the failure to pass the bill into law and to consider that this is an issue of national emergency which must take precedence over any domestic or political issue, a recent newspaper ad said. The group asserts that this issue “threatens the viability and integrity of our financial sector and the wellbeing of the nation.”
The association noted that the proceeds of criminality laundered through the established legitimate financial systems and used to finance terrorism and other criminal activities is a global phenomenon that has long engaged the attention of governments. These activities have threatened to subvert entire governments and have had devastating and debilitating impact globally, costing economies of the world billions of dollars in terms of destruction of property, loss of life and human suffering, the group said. Proceeds of crime are now used in the promotion of armed conflict and proliferation of weapons of mass destruction.
“The effect of the FAFT (Financial Action Task Force on money-laundering) Blacklist is significant and any country or jurisdiction placed on the FATF Blacklist finds itself under intense financial pressure. Essentially, global financial translations of the blacklisted country are no longer accepted or accepted only after intense scrutiny by the rest of the world’s financial markets,” the press release said.
Incomprehensibly, Guyana is on the verge of being blacklisted, the IAG said. The insurance association cautioned that the effects will be felt immediately – insurance and banking transactions will become nearly impossible; all financial services will be severely affected as well as every form of commerce supported by a healthy financial sector. The group believes that without the global acceptance of risk, a small country with limited insurance bearing capacity such as Guyana cannot effectively insure the country’s assets.
“All commerce requiring life, health, motor, cargo, marine, aircraft, liability, accident, fire and catastrophic loss insurances will be severely restricted. The insurance of all international financial instruments will be impaired. Bankers will be unable to effect simple letters of credit. Unpaid for shipments of goods bound for Guyana will not leave their ports,” the press release said. Simple essentials of life, like fuel, will become scarce commodities.
The association said the financial sector is already replete with incidents of heavily increased global scrutiny of otherwise ordinary transactions which, if the law is not passed, will exact an even heavier toll on the nation.