Guyana’s Failure to Pass Anti-Money Laundering and Countering the Financing of Terrorism Act Sparks Concern

The Caribbean Community Secretariat has expressed concern over Guyana’s failure to pass its Anti-Money Launderling (AML) and Countering the Financing of Terrorism (CFT) Act, a move that has also been criticized by the Organization of American States. As a result, the Caribbean Financial Action Task Force (CFATF) has blacklisted the country.

Background

The AML/CFT legislation aims to combat money laundering and terrorist financing by implementing stricter regulations on financial institutions and monitoring suspicious transactions. However, opposition parties in Guyana have refused to pass the bill unless it is amended to give them greater oversight of its implementation.

Consequences of Failure

• If Guyana fails to pass the legislation, it could find itself locked out of the global financial network and unable to perform routine international financial transactions, warned Earl Jarrett, General Manager of Jamaica National Building Society.
• The country’s third-largest inflow of remittances in the Caribbean could also be disrupted, as international banks may cease corresponding and remittance relationships with entities in Guyana.

Complicated Politics

The adoption of AML/CFT legislation is complicated by Guyana’s internal politics. The government cannot implement legislation not supported by opposition parties, which have refused to pass the bill unless it is amended to their liking, explained Ronald Sanders, a senior fellow at London University and former chairman of the CFATF.

CFATF Blacklisting

Ignacio M. Alvarez, of counsel at Diaz, Reus & Targ, noted that the CFATF has blacklisted Guyana due to AML/CFT deficiencies and threatened further sanctions if the government does not implement needed legislative changes.

• Failure to pass the legislation would lead to serious sanctions, including international banks terminating their relationships with Guyanese counterparts.
• The blacklisting will have significant economic costs, including higher fees for international transactions and adverse impacts on trade and financial flows, warned Jan Smith, director for Latin America at Edgar, Dunn and Co.

Global Implications

Experts agree that Guyana’s failure to pass the legislation is not just a regional issue, but also has global implications. The country’s economy could be severely impacted if international banks and partners choose to cease doing business with it due to the blacklisting.

Overall, Guyana’s failure to pass the AML/CFT Act is a pressing concern that requires immediate attention from the government and opposition parties. Failing to do so may have severe consequences for the country’s economy and global reputation.