Financial Crime World

Government Urged to Take Pro-Active Approach in Establishing Pan-Caribbean Financial Centre

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Port of Spain, Trinidad and Tobago - The government has been urged to take a proactive approach in establishing the legal and regulatory infrastructure for the Pan-Caribbean Financial Centre (PCFC) as quickly as possible.

A Dedicated Effort Required

According to a new report, this will require a dedication of resources to various tasks at hand and a commitment to implementation within schedule. The report highlights that the government’s role as developer will involve participating in the market under special circumstances and conditions, particularly where the market is unable to meet social needs or where there are market imperfections.

Innovative Institutions and Incentives

The report also recommends that the government establish innovative institutions, such as the Trinidad and Tobago Unit Trust Corporation and the Home Mortgage Bank, and provide incentives to facilitate market and institutional development in specialized areas.

Policy Recommendations

To achieve its goal of developing an internationally competitive PCFC by 2020, the government is advised to implement the following policy recommendations:

Upgrading the Legislative Framework

  • Upgrade the legislative framework to ensure a sound legal basis for all financial sector activities.

International Financial Reporting Standards

  • Require companies engaged in financial products and services to adopt International Financial Reporting Standards (IFRS).

Regulatory Authority

  • Establish a single Regulatory Authority with the necessary powers and authority to regulate the financial sector.

Taxation Regime

  • Review the taxation regime for the financial sector to ensure it is competitive and free of tax-induced distortions.

Telecommunications Sector

  • Liberalize the telecommunications sector to keep pace with technological developments.

Competition Policy

  • Expedite the development of a competition policy for the financial services sector.

Financial Services Agreements

  • Ensure that commitments under bilateral, regional and international financial services agreements do not hinder the development of the financial system.

Alternative Dispute Resolution Mechanism

  • Upgrade the Office of the Banking Ombudsman to a Financial Services Ombudsman and establish an alternative dispute resolution mechanism.

Human Resource Development

  • Develop a cadre of human resource personnel capable of efficiently managing the financial services sector.

Sector-Specific Recommendations

For the banking sector, the report recommends accelerating efforts to amend the Financial Institutions Act (1993) to enhance supervision and strengthen the Central Bank’s enforcement powers. This includes provisions for supervising financial institutions that are part of a group or conglomerate, cross-border supervision, and reporting requirements.

Call to Action

The government has been urged to take swift action in implementing these recommendations to ensure the successful development of the Pan-Caribbean Financial Centre.