THE Guyana Bankers Association, yesterday reiterated its call for action on the Anti–Money Laundering and Countering the Financing of Terrorism Act (AML/CFT) Bill, ahead of the February 13 meeting of the France-based Financial Action Task Force (FATF).Head of the local body, Mr. Amit Kumar, told the Guyana Chronicle that the banks here see a strong AML/CFT legislative framework as fundamental to their continued functioning.
In a presentation last Wednesday to the Parliamentary Select Committee reviewing the Bill, he said urgent action is needed to ensure that all of Guyana’s commercial banks are in accordance with acceptable international standards.
Kumar made clear that it is important that Guyana enacts the recommendations of the Caribbean Financial Action Task Force (CFATF), which include amendments to the current law that are “comprehensive and satisfactorily compliant” with all international and domestic requirements.
He said the implications of non-compliance were outlined at the Select Committee meeting.
The statement to the Committee read: “Without the necessary action taken to ensure compliance with the CFATF’s recommendations to enhance Guyana’s AML/CFT framework, there would be far-reaching implications for the financial/banking sector.”
STATED IMPLICATIONS
The stated implications included the facts that:
* Bank-to-Bank relationships and business between Guyana’s commercial banks and foreign banks may be halted for an unpredictable amount of time. This includes relationships with commercial banks in sister CARICOM territories. The foreign banks may opt not to do business at all with Guyana’s banks if Guyana’s AML/CFT laws do not meet the standard required by the requisite AML/CFT bodies (in this case the CFATF) and are thereby inadequate to provide those institutions with the requisite level of comfort to conduct business with local banks;
* Adequate access to foreign exchange in a timely manner may be affected;
* Members of the public may experience difficulty in sending, or receiving money from overseas, through commercial banks and cambios if the correspondent banking relationships with foreign banks are jeopardized, as there may be no bank-to-bank relationships to foster this activity;
* Payments in a timely manner to persons overseas for provision of goods and services may be affected, and
* The “Letter of Credit” issued by banks in Guyana may not be accepted by overseas banks, resulting in numerous problems and complications when conducting business with these entities.
“The total effect of the foregoing is that the impact to the integrity of the local banking sector could significantly reduce the level of international financial activities that Guyana’s commercial banks can engage in,” the statement said.
TIMELY RESOLUTION
The association emphasised the need for Members of Parliament to recognise the need for a timely resolution and take “urgent action” to implement the recommendations of the CFATF.
“We the members of the Guyana Association of Bankers remain concerned with the potential consequences of being blacklisted, should Guyana fail to adequately demonstrate progress in implementation of recommendations of the CFATF, including amendment of its AML/CFT legislation prior to the country review in November,” the statement said.
The Bankers Association is a representative group that includes all the major commercial banks operating in Guyana.
In addition to FATF’s deadline, CFATF itself is expected to review Guyana’s position in May 2014 at its next meeting. If Guyana is unable to meet the May 2014 deadline, further sanctions are expected to be levied against this country, which has already been blacklisted by CFATF.
Written By Vanessa Narine