Financial Crime World

Banking Compliance Regulations in Guyana Under Scrutiny as Central Bank Implements Reforms

Guyana’s central bank, the Bank of Guyana, has been taking concrete steps to strengthen banking compliance regulations and combat money laundering and terrorist financing. This move comes after several years of criticism from international financial watchdogs, who expressed concerns over Guyana’s lax regulatory environment.

Background

The Financial Institutions Act No.1 of 1995 provides the framework for regulating banking and other financial activities in Guyana. However, it was only recently that the country began to address weaknesses in its anti-money laundering and combating the financing of terrorism (AML/CFT) regime.

  • In November 2013, the Caribbean Financial Action Task Force (CFATF) advised Guyana to improve its AML/CFT standards, citing a lack of effective measures to prevent money laundering and terrorist financing.
  • The warning was followed by a referral to the global Financial Action Task Force (FATF) in May 2014.

Progress Made

Guyana has since made significant progress in addressing the deficiencies identified by CFATF and FATF. In October 2016, the country successfully exited the FATF International Cooperation Review Group after implementing all necessary reforms.

However, despite this progress, banking compliance regulations remain a challenge for Guyana. The country’s financial systems are still vulnerable to money laundering and corruption, and there is a need for further implementation of AML/CFT measures.

Initiatives Implemented

To address these concerns, the Central Bank has been working on several initiatives, including:

  • Passage of Financial Institutions Bill: In July 2018, Guyana passed a Financial Institutions Bill aimed at modernizing its financial systems, including a framework for electronic money transfers.
  • Real-Time Gross Settlement (RTGS): The Central Bank is implementing RTGS, which will enable real-time transactions and increase transparency in the financial system. This move is expected to reduce money laundering and corruption, and promote foreign investment.

Conclusion

Guyana’s efforts to strengthen its banking compliance regulations are crucial in attracting foreign investment and managing the country’s oil revenues. The government has committed to implementing AML/CFT measures to ensure that the financial sector operates transparently and efficiently.