FIU completes money laundering risk assessment, action plan

The Financial Intelligence Unit (FIU) yesterday announced that it has spearheaded the completion of the country’s first money laundering and terrorist financing National Risk Assessment and the development of a Risk Based Assessment Action Plan.

These two documents will soon be handed over to government, according to an FIU status report, which was issued by the Ministry of Finance late last evening.

It stated that the FIU, despite its constraints, has made significant progress, which includes the appointment of supervisory authorities for most of the reporting entities in various financial sectors.

Providing an update on the unit’s implementation of a strong regulatory and supervisory framework to ensure Guyana succeeds at its Fourth Round Mutual Evaluation by the Caribbean Financial Action Task Force (CFATF), the report said the unit has taken the lead in the completion of the national risk assessment and the development of the risk-based action plan, which are intended to guide the national anti-laundering strategy.

While not providing specifics, the report also said that the Unit submitted seven reports to the Special Organized Crime Unit (SOCU) during 2016 and four to date for 2017. SOCU is the investigative arm of the FIU.

According to the report, the FIU coordinated the 14-month exercise for the completion of the risk assessment and concluded it with a two-day workshop, which was held on the April 12 and April 13 at the Guyana Marriot. The report said the assessment and plan will be formally handed over to the government in the “very near future.”

It said since the enactment of the AntiMoney Laundering and Countering the Financing of Terrorism (AML/CFT) Act, the FIU has played an integral role in Guyana’s effort to fight money laundering and terrorist financing internationally and locally. The unit, it was stated, has contributed extensively throughout the mutual evaluation exercise, including its followup processes to remedy the deficiencies highlighted and has worked in collaboration with the legislative drafters attached to the Attorney General’s Chambers to interpret the requirements of the Financial Action Task Force (FATF) recommendations, many of which were incorporated into the AML/CFT laws and regulations. The FIU has also, independently, issued several critical guidelines, the report informed.

It was noted that the culmination of these corrective measures resulted in Guyana no longer being subjected to monitoring by the FATF.

Guyana’s evaluation under the CFATF Third Round of Mutual Evaluation process revealed that it was rated as Partially Compliant (PC) and NonCompliant (NC) in all sixteen of the FATF key and core recommendations, which resulted in it being required to undertake various corrective measures, one of which was the appointment of Supervisory Authorities for all reporting entities. As a result, in preparation for the Fourth Round of Mutual Evaluation, Guyana must have in place a robust regulatory and supervisory framework for all the reporting sectors.

The report warned that the implications for non-compliance with FATF recommendations could have far reaching consequences for Guyana, as this could reflect negatively during Guyana’s Fourth Round of Mutual Evaluation by the CFATF, which is scheduled for 2022. It is therefore critical that Guyana accelerate the process of strengthening its overall AML/CFT Supervisory framework, it said.

According to the report, the implementation process, therefore, requires ensuring that all reporting entities under the AML/CFT Act comply with the provisions that relate, among other things, to the conducting of customer due diligence, record keeping and maintenance, submitting suspicious and other reports to the FIU and appointment of Compliance Officers.

The report listed the categories of reporting entities as financial institutions, cambios, money transfer agencies, insurance companies, unit trusts, securities, pawnbrokers/money lenders, dealers in precious metals, dealers in precious and semi-precious stones, friendly societies, casinos, cooperative services/credit unions, financial trust/company service providers, real estate/house agents, used car/car parts dealers, betting shops and lotteries.

The FIU, it stated, has conducted several training sessions with most of the categories of reporting entities, including training on reporting formats for submission of the required reports to the FIU. Guidelines on suspicious, terrorist property reports and reporting entity’s Compliance Regime were also published and made available on the FIU website, the report said, before adding that to date most of the reporting entities have made some progress in developing their AML/CFT regimes, in terms of appointing compliance officers, conducting customer due diligence and consistently submitting large cash, terrorist property and suspicious reports to the FIU.

“Though, this achievement is noteworthy, the country needs to do much more if it is to fully satisfy the requirement relating to regulation, supervision and monitoring of compliance by these sectors, which must be done by a Supervisory Authority or supervisory mechanism,” the report said.

It added that while supervisory authorities have been appointed for most of the reporting entities, none were appointed for Attorneys-at-law, Notaries, Independent Legal Professionals and Accountants, or (Non-Financial) Trust or Company Service Providers, who are required to comply with specified provisions of the AML/CFT Act when they engage in specific activities. The report said that the FIU is in consultations with stakeholders to assist with identifying an appropriate supervisory authority for these two outstanding sectors and put systems in place to effectively monitor, regulate and supervise all reporting entities as required by local laws and FATF-recommendations.

According to the report, the FIU has already met with all of the supervisory authorities that have been appointed to date and informed them of their roles and expectations. The FIU, it was stated, has also issued and published a number of guidelines, including an examination guideline designed to guide supervisory authorities on the procedure to be employed when conducting an examination of the sectors under their supervision. These guidelines are available on the FIU’s website.

The report added that the unit is managing to execute its functions though it is faced with limitations. “Despite significant staff and other constraints, the FIU continues to press forward with its core responsibility of receiving and analyzing data, and the provision of intelligence reports to the law enforcement agencies to assist the country in its fight against ML (money laundering) and TF (terrorist financing),” the report said, before adding that intelligence reports are prepared and submitted primarily based on reports received from reporting entities.

Matthew Langevine is the Director of the FIU, which is located in the compound of the Ministry of Finance on Main Street.

The FIU, according to its website is an autonomous body responsible for “requesting, receiving, analyzing and dissemination of suspicious transaction reports and other information relating to money laundering, terrorist financing or the proceeds of crime.” It states that the unit was established and operates within the ambit of the AML/CFT Act and its regulations.

The unit’s mandate is to facilitate the detection, prevention and deterrence of money laundering, and financing of terrorist activity in Guyana, while ensuring the protection of the personal information under FIU’s control.

Accordingly the unit’s mission is to help protect the integrity of Guyana’s financial system through the detection and deterrence of money laundering and terrorist financing.