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Caribbean insists on equal treatment
by the Caribbean Financial Action Task Force
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by the Caribbean Financial Action Task Force
As the offshore financial sector in the Caribbean continues to adapt to meet the highest international standards of anti-money laundering laws and regulations, the Paris-based Financial Action Task Force removes one other regional state, Dominica, from its List of "uncooperative" countries.
And according to the Caribbean Financial Action Task Force, the regional institution established to develop and monitor standards for the international financial services sector in the region, Grenada and St. Vincent and the Grenadines are next in line to be to be de-listed by the FATF.
At a recent Ministerial meeting of the CFATF in The Bahamas, newly appointed Chairman of the Task Force, The Bahamas’ Attorney General and Minister of Education, Alfred Sears, noted that his country and several other countries in the region had given up legitimate business worth millions of US dollars and implemented several pieces of new legislation in their efforts to comply with the FATF standards.
"Having borne this high cost of implementing the international standards against money laundering, we insist on equality of treatment of all countries, including FATF member countries," said Chairman Sears.
On another element of all states being required to play by the same rules, Chairman Sears noted that while The Bahamas and other CFATF countries had removed the ability of persons to buy and sell shares and hide information on the true owners of the shares, the practice is still being widely used in at least two states in the United States of America.
"The continued use of these companies may be a loophole in the money laundering regime and is certainly not in keeping with the new international standards on money laundering that have been imposed on members of CFATF, said Sears.
He said another difficulty facing CFATF members is the new Patriot Act of the United States and the Regulations made under that Act. Under the Act, foreign banks with US accounts are allowed to designate a US resident agent to accept legal service of a government subpoena or summons. It also allows the US to subpoena documents related to a foreign bank’s US account whether the documents are inside or outside the United States. The new laws, passed in September, allows the US to either subpoena information from a foreign bank through its designated US agent or it may seek to obtain information through the Mutual Legal Assistance Treaty which it has with the country where the foreign bank is based.
"There is a danger that the United States may for the sake of expediency, choose to circumvent the MLAT procedure and obtain information by means of subpoena," said Chairman Sears. He promised that Attorneys General and Ministries of Justice of the Caribbean Basin Region will continue to dialogue with their counterparts from the CFATF Group of Cooperating and Supporting nations which are Canada, France, the Netherlands, Mexico, Spain, the United Kingdom and the United States of America to discuss the way forward on this matter.
The new Chairman said it was propitious that he on behalf of his Government had assumed leadership in the CFATF at this time as The Bahamas, because of its long experience in the sector and the advanced state of its anti-money laundering legislation, could offer guidance and assistance to member states.
In several countries of the Caribbean and Central America, the international financial services sector accounts for over 50 per cent of the hard currency earned. Since the removal of The Bahamas, Cayman Islands, Panama, St. Kitts and Nevis, now Dominica, and with Grenada, Guatemala and St. Vincent and the Grenadines moving forward in the FATF process of coming off the list of uncooperative countries, the industry once again seems a viable option.
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