Anti-money laundering bill sent to select committee

The combined opposition, the A Partnership for National Unity (APNU) and Alliance For Change (AFC) Tuesday night used their majority to send the anti-money laundering legislation to a special select committee for fine-tuning, despite warnings from the government that delays in the passage of the bill could see Guyana being sanctioned.

Guyana has a May 27 deadline to have the bill in place. When the bill came up for debate Tuesday night in the House, government’s Chief Whip Gail Teixeira said the Parliament has the capacity to deal with the bill instead of sending it to the committee. She warned the House of the contentious situations that may arise because of the decision which was taken.
“I am warning this House, it is treading on dangerous grounds…” Teixeira lamented. It was noted that if the bill does not meet the May 27 deadline, there is impeding international sanctions and obligations that could fall on the country, bringing about a new burden to be rectified. APNU Member of Parliament (MP) Basil Williams raised a motion for the bill to be sent to the select committee, citing what he described as the complexity of the legislation.
“Because of the complexity of the bill we cannot short change the citizens of Guyana by rushing it,” he argued.
APNU executive member Lance Carberry had said last week that: “the track record shows that such committees could finish their work expeditiously if all the necessary information is provided.” He continued, “I could tell you from my own experience in Parliament that select committees act very quickly if the information that they require is provided in a very expeditious manner.”
Carberry noted that a parliamentary select committee can scrutinise pieces of far- reaching proposed legislation and seek answers to questions. He emphasised that rushing legislation without the benefit of good parliamentary scrutiny can be detrimental.
Williams then had said too that the bill is aimed at empowering the Financial Intelligence Unit to investigate and prosecute individuals and businesses it suspects are laundering finances.
According to him, due to the complexity of the bill, it is expected to automatically go directly to a select parliamentary committee for scrutiny.
The Organisation of Economic Co-operation and Development (OECD) has given Guyana until the end of the month to upgrade its Anti-Money Laundering and Financing of Terrorism Law, in keeping with recommendations from the Caribbean Financial Action Task Force.
Consequences
If Guyana misses the May 27 deadline and is blacklisted by OECD countries, every movement of money in or out of Guyana will be intensely scrutinised, thus creating significant delays in the financial and banking system. The United States, Canada, United Kingdom and the European Union (EU) last month teamed up to provide Guyana with experts at a workshop on money laundering.
On April 22, government tabled the Anti-Money Laundering and Countering the Financing of Terrorism (Amendment) Bill 2013, specifically to meet the May 27 deadline to implement the Financial Action Task Force on Money Laundering (FATF) recommendations to address weaknesses in the act and related legislation.
Among other things, the bill seeks to widen the reach of the law by including concepts such as beneficial ownership to identify persons who ultimately exercise ownership rights in legal entities and widening definitions, such as the “proceeds of crime” to include indirect gains, “property” to include electronic or digital evidence and “terrorist financing” to include funds whether from a legal or illegal source, in order to aid prosecutions.
According to the bill, the amendments propose to increase the minimum fine upon conviction for certain money laundering offences from Gy$ 1 million to Gy$ 5 million, the insertion of a new section to provide for the freezing of funds of terrorists and terrorist groups or organisations and widening the scope of the FIU to request information from telecoms providers.
The amendments also seek to expand due diligence obligations of reporting entities.
One of the amendments would provide for reporting entities not to open new accounts or conduct business when it is unable to obtain a satisfactory evidence of the identity of the intended customer and to consider making a suspicious transaction report.
Where a customer becomes “politically exposed”— either directly as a functionary of the government, state, judiciary, military, important political party, or indirectly as a family member or close associate of such a functionary — the senior management of a reporting entity would have to greenlight continued business relations.
The bill also makes provisions for amendments to the Gambling Prevention Act; the Mutual Assistance in Criminal Matters Act; the Securities Industries Act; the Money Transfer Agencies Licensing Act; the Foreign Exchange (Miscellaneous Provisions Act); the Co-operatives Societies Act; the Companies Act and the Insurance Act.