Dear Editor,
As you are aware the Caribbean Financial Action Task Force (CFATF), an organisation of states and territories of the Caribbean Basin established in 1990 to implement common counter-measures against money laundering, has identified the legislative and other measures taken by Guyana to deal with money laundering and the financing of terrorism as deficient. This finding was announced by the CFATF at its just concluded biannual meeting held in The Bahamas.
The regional body called on its twenty-nine members across the Caribbean Basin to consider implementing counter measures to protect their financial systems from the ongoing money laundering and terrorist financing risks emanating from Guyana.
The action comes after persistent attempts dating back to November 2011 to persuade the Government to address the several deficiencies in its anti-money laundering and terrorist financing regime. The CFATF has no powers to impose direct sanctions but it is expected that cross-border financial transactions will be affected in varying degrees as other countries take defensive measures to prevent their own systems becoming infected by transactions with Guyana.
While the members of the CFATF are all Caribbean countries, the organization itself is a member of the international body Financial Action Task Force (on Money Laundering) (FATF), an initiative of the Finance Ministers of seven developed nations: the US, UK, France, Germany, Italy, Canada and Japan.
The FATF now comprises 34 member jurisdictions and two regional organisations including the CFATF.
Ram & McRae expects that all the countries coming under the FATF umbrella would carefully consider financial transactions with Guyana. We do however caution against alarm and panic. Prior to The Bahamas meeting, sentiment seemed in favour of blacklisting Guyana which would result in dire and catastrophic consequences. The language from the meeting was more measured and fell far short of the predictions.
We do not anticipate that countries will stop doing business with Guyana. We believe however that there will be consequences for businesses and individuals alike as other countries review the framework within which transactions are carried on with Guyana. The most significant impact will be on time sensitive transactions as more questions are raised about the source and destination of funds and the purpose and validity of transactions which could ultimately translate into increased costs and possibly lost business opportunities.
We therefore recommend that in undertaking transactions, businesses and individuals should allow for some delays in the processing of both inbound and outbound transactions. We further recommend that an additional period of one week be allowed for any additional enquiries and investigations. In particular businesses and individuals must maintain adequate records and a reliable paper trail of their transactions.
Ram & McRae takes this opportunity to call on the country’s political leaders both inside and outside of the National Assembly to address the money-laundering and related systemic issues that continue to undermine the integrity of Guyana’s financial system, fair trading and public trust and international confidence.
Yours faithfully,
Christopher Ram
Ram & McRae
