Attorney General Basil Williams

Despite US assurances

Blundering once again, as Government hurriedly forced the passage of its own version of the Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) Amendment Bill 2015, Guyana still remains on the Financial Action Task Force (FATF) blacklist despite premature assurances from Attorney General Basil Williams and US ChargÉ d’Affaires Bryan Hunt suggesting otherwise.

According to a recently published FATF report, Guyana still remains non-compliant with its recommendations.

“Since June 2015, Guyana has taken steps towards improving its AML/CFT regime… However, the FATF has determined that certain strategic deficiencies remain,” an excerpt from the report stated.

US ChargÉ d’Affaires Bryan Hunt

From the inception, the People’s Progressive Party/Civic (PPP/C) has been contending that the A Partnership for National Unity/Alliance For Change (APNU/AFC) version of the Bill did not meet the requirements set out by the international body. Even whilst in Opposition and despite evidence presented to them, the APNU and AFC stubbornly refused to accept that their version of the Bill was noncompliant and reverted to using their majority in the National Assembly to block the passage of the PPP/C-proposed AML/CFT Bill.

After the Bill was finally passed in Parliament and became law this year, the PPP/C still asserted that it did not meet the FATF’s requirements, but the Attorney General insisted that it did. He had issued a press release stating that “Guyana is now fully compliant with the FATF’s requirements”.

The US ChargÉ d’Affaires also sought to assure the Guyanese populace that the Bill was fully compliant with FATF’s recommendations.

“If the Bill were to be passed in its current form, Guyana would then be fully compliant with the recommendations that have been put forward,” Hunt had posited.

Former Attorney General Anil Nandlall

But, despite Government’s argument, the FATF report confirmed the PPP/C’s position. It also noted that Guyana should continue to implement its action plan by ensuring and implementing an adequate legal framework for identifying, tracing and freezing terrorist assets; ensuring a fully operational and effectively Functioning Financial Intelligence Unit (FIU); establishing effective measures for customer due diligence and enhancing financial transparency; and implementing an adequate supervisory framework.

The Compliant Version

Contacted for a comment on the matter, former Attorney General Anil Nandlall said the situation was “very disappointing”.

In explaining the chain of events leading up to the current situation, he stated that specific directions were given and his Government precisely followed those directions and crafted the relevant amendments and regulations to the law.

“We did that and we forwarded that up to the examining bodies and consultants both at Caribbean Financial Action Task Force (CFATF) and American Regions Review Group (AARG) and at both levels we were told that our amendments were compliant and that our regulations were compliant,” Nandlall related.

Unfortunately, he noted, the new Government while in Opposition had put forward certain amendments which would have rendered Guyana noncompliant and which would have put Guyana through further scrutiny owing to the implications of those amendments. Nandlall explained that APNU/AFC’s version then saw the possibility of certain aspects of Guyana’s law that was already compliant becoming noncompliant. Also, he said, some aspects of the proposed amendments conflicted with the recommendations Guyana was specifically asked to implement.

“We drew that to their attention whilst we were in Government but they used their majority in the Select Committee to frustrate our efforts in passing the compliant version,” Nandlall stated.

Nonetheless, the former Attorney General related that his Government submitted APNU/AFC’s version to the CFATF, but even it pointed out that the document was noncompliant with the recommendations.

“They pointed out that those weren’t the directions given and that those amendments being proposed put the country in further problems…CFATF said that to us in writing. We submitted that letter to the Select Committee and the majority of the Select Committee was still not persuaded, even by CFATF to that effect. So they maintained their position stubbornly and when they became the Government, they passed it through the Parliament in one sitting, they forced the amendment through in the absence of an opposition,” Nandlall related.

US interference

Nandlall also noted that it was extremely strange that the US ChargÉ d’Affaires would put out a statement saying that the AML/CFT Bill 2015 was compliant especially since the US continued to impose sanctions against Guyana for not being compliant.

“Strangely, they (Government) managed to get the American Embassy to put out a statement to say these amendments were compliant… Ironically, America is one of the countries, though they say we are compliant, they continue to impose sanctions against Guyana,” he posited.

“I don’t know how the American Embassy could have determined that (Guyana was compliant) when America themselves are subjected to the same requirements we are subjected to – but they issued a statement.”

Nandlall also alluded to the fact that the new Attorney General sought to mislead the public by issuing a press statement to the effect that Guyana became compliant when the Bill was not yet submitted to FATF at the time.

“And then the other thing is, Mr Williams issued a statement through AG Chambers when the Bill was passed, he made a very strange public announcement that the Bill was compliant with FATF requirements when the Gill was not even seen or submitted to FATF as yet…It was only submitted to the Americas Review Group…But Mr Williams misled the nation by prematurely announcing that we are compliant,” he said.

AML/CFT Bill 2015

Among the amendments proposed by the Government is removing the power of the Attorney General and investing it in the Director of the Financial Intelligence Unit. According to the PPP/C, the Government proposed an amendment to Section 2(2) of the AML/CFT Act 2009 by deleting the words ‘Attorney General’ wherever they appear and replacing them with the word ‘Director’.

“It should be noted that the primary function of the FIU as stated in the first criterion of FATF Recommendation 26 of the Third Round is to serve as a national centre for receiving, analysing and disseminating disclosures of suspicious transaction reports and other relevant information concerning suspected money laundering or financing terrorism activities.

“Countries should consider whether the Director of the FIU given his main function is the appropriate official with respect to resources and qualifications to ensure that entities are listed, evidence presented to judges in connection with listing and orders by judges in relation to listing are reviewed. This function is closely linked to the application for court orders to seize and freeze criminal proceeds of the listed entities, a function that is carried out usually by the Attorney General in his/her role as legal adviser to the Government to fulfil a country’s international legal obligations. Additionally, the Attorney General in his/her role as legal adviser to the State helps to establish the legality of listing and the actions to be done in accordance with it.”

The other contentious amendments are the establishment of an AML/CFT Authority whose members will be appointed by the National Assembly, and the removal of the powers of the Finance Minister to appoint the Director and the power of the President to dismiss the Director and placing these powers in the Authority. The Authority will also be responsible for overseeing the operations of the FIU.

The PPP/C is contending that the above amendment as stated appears to undermine the autonomy of the FIU. “As stipulated in the criteria of FATF Recommendation 26, the FIU should have sufficient operational independence and autonomy to ensure that it is free from undue influence or interference. The assigning of the responsibility of oversight of the operations of the FIU to the AML/CFT Authority effectively eliminates the operational independence and autonomy and does not comply with the requirement of Recommendation 26.”

The third issue which has raised the ire of the PPP/C is the amendment to Section 37 by extending the powers of a Police Officer or Customs Officer to seize $10 million in cash or more anywhere in Guyana upon suspicion that such cash is derived from a serious offence, will be used to commit a serious offence, is involved in money laundering or where a false declaration was made, and also giving these same powers to the FIU. “The above amendment is not a specific requirement of the FATF standards. It is noted that no deficiency with respect to this obligation was noted in Guyana’s Mutual Evaluation Report for the Third Round. Similar provisions are in place in Trinidad and Tobago, Grenada and St Vincent and the Grenadines with safeguards which include limiting the initial period of seizure to hours and requiring judicial approval for any extension of the period.”

Moving forward

Moving forward, Guyana will now have to await further directions from FATF in terms of where it is still deficient. Guyana will then have to make attempts to fulfil the outstanding deficiencies and report again to the reviewing bodies.