Guyana’s Finance Minister, Winston Jordan is peeved that his country and several other sister Caribbean Community (Caricom) nations have been listed by the United States (US) as “major money laundering countries.”
“It is denial of all of the efforts that we in the Caribbean have been making to make our countries safer, to rid our countries of bad money and so on and I guess if it is not back to the drawing board, we will have to collectively mount a rearguard to stem whatever fall-out may come from such bold headlines,” he said.
In the US State Department’s 2017 International Narcotics Control Strategy Report, Guyana was observed as having a large cash-based economy. “There is a culture of using informal networks to move money between Guyana and the diaspora, and Guyana has a large cash-based economy. Many criminals use cash couriers or familial
networks to move large sums of money between Guyana and the United States.
Unregulated currency exchange houses also pose a risk, as they are used both for the exchange of currency
and to transfer funds to and from the diaspora. Additionally, casinos are legal in Guyana and pose a risk for money laundering. Guyana has one casino,” the report states.
Jordan said Caricom would have to mount a major diplomatic offensive against that listing although they are not on the list of the global financial crimes watchdogs such as the Financial Action Task Force (FATF) and the Caribbean Financial Action Task Force (CFATF).
Except for the United Kingdom’s (UK) overseas territory of Montserrat, all the 14 other full Caricom member nations have been categorised as “major money laundering countries.”
Caricom Secretary General, Irwin La Rocque said he has already contacted the US and individual member-states have already done so through their ambassadors in Washington DC. He said the matter would be on the agenda of Caricom foreign ministers when they meet in Barbados next week.
“This is not the way to do it and I have raised the matter with the US and I’m sure, I’m aware that Caricom ambassadors have done the same and we are going to continue raising it,” he said of the unilateral listing of the Caricom member states at a time when the region has been coping with the severance of correspondent banking relationships by several American banks.
With Guyana still regarded by the US as a transit country for South American cocaine destined for Europe, the United States, Canada, West Africa, and the Caribbean, the State Department has identified drugs trafficking and corruption are believed to be the primary sources of laundered funds.
The US further described as “substantial” money laundering from other sources- human trafficking,
contraband, illegal natural resource extraction, and tax evasion.
The INCS Report says launderers use fictitious agreements of sale for non-existing precious minerals to support large cash deposits at financial institutions; cross-border transport of small volumes of precious metals, declared as scrap or broken jewelry to avoid scrutiny by the relevant officials and the payment of relevant taxes and duties and the use of middle and senior-aged cash couriers for the cross-border transport of large sums of U.S. dollars.
The US recommended that Guyana embark on a series of measures to further tighten the system against money laundering. “Guyana should raise awareness and understanding of AML (Anti-Money Laundering) laws and implementation procedures,through training and the publication of guidelines, within the judicial system and in agencies with the authority to investigate financial crimes,” said the State Department.
Suspicious Transaction Reports, wire transfers, and customer due diligence regulations should be strengthened and additional resources extended to the Financial Intelligence Unit (FIU) and the Special Organised Crime Unit (SOCU), says the document.
The State Department says that international experts have recommended Guyana make the following major improvements to its anti-money laundering regime: adequately criminalize money laundering; to establish a fully operational and effectively functioning FIU; institute effective measures for customer due diligence and enhanced financial transparency; and establish adequate suspicious transaction report requirements.
In recent years, Guyana has amended its Anti-Money Laundering and Countering of Financing Terrorism Act in keeping with tough recommendations by the Caribbean Financial Action Task Force and the France-headquartered Financial Action Task Force.