GUYANA
Summary
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Sanctions

None

FAFT AML Deficient

No longer on list

Higher Risk Areas

 

Compliance with FATF 40 + 9 Recommendations

Not on EU White list equivalent jurisdictions

Corruption Index (Transparency International & W.G.I.)

World Governance Indicators (Average Score)

Medium Risk Areas

 

US Dept of State Money Laundering assessment

Weakness in Government Legislation to combat Money Laundering

Failed States Index (Political Issues)(Average Score)

 

 

ANTI-MONEY LAUNDERING

 

FATF Status

Guyana is no longer on FATF’s list of aml deficient countries.

 

FATF Statement re AML Strategic Deficiencies: 21 October 2016

The FATF welcomes Guyana’s significant progress in improving its AML/CFT regime and notes that Guyana has established the legal and regulatory framework to meet its commitments in its action plan regarding the strategic deficiencies that the FATF had identified in October 2014. Guyana is therefore no longer subject to the FATF’s monitoring process under its on-going global AML/CFT compliance process. Guyana will work with CFATF as it continues to address the full range of AML/CFT issues identified in its mutual evaluation report.

 

CFATF Statement re AML Strategic Deficiencies: 30 May 2014

As a result of not meeting the agreed timelines in its Action Plan, the CFATF recognises Guyana as a jurisdiction with significant AML/CFT deficiencies, which has failed to make significant progress in addressing those deficiencies and the CFATF considers Guyana to be a risk to the international financial system. Members are therefore called upon to implement further counter measures to protect their financial systems from the ongoing money laundering and terrorist financing risks emanating from Guyana. Also, the CFATF has referred Guyana to the FATF.

Countermeasures could entail, among others, the requirement of enhanced due diligence measures; introducing enhanced reporting mechanisms or systematic reporting of financial transactions; refusing the establishment of subsidiaries or branches or representative offices in the country concerned, or otherwise taking into account the fact that the relevant financial institution is from a country that does not have adequate AML/CFT systems and limiting the business relationships or financial transactions with the identified country or persons in that country.

 

Background Information

In November 2011 the CFATF brought to the attention of its Members certain jurisdictions including Guyana with significant strategic deficiencies in their AML/CFT regime. With a view to encouraging expeditious rectification of the identified strategic deficiencies Guyana and the CFATF developed an Action Plan with identified target dates to address the strategic deficiencies that exist in Guyana’s national architecture to combat money laundering and the financing of terrorism.

The CFATF issued a public statement in May 2013 recommending that Guyana took steps to ensure that it addressed its AML/CFT deficiencies. Additionally, in November 2013 CFATF issued a further public statement calling upon its Members to consider implementing counter measures to protect their financial systems from the ongoing money laundering and terrorist financing risks emanating from Guyana. Guyana has failed to pass the relevant legislation necessary for it to significantly improve its AML/CFT regime and therefore has not substantially addressed the outstanding deficiencies from its mutual evaluation report. The CFATF urges Guyana to urgently, immediately and meaningfully address its AML/CFT deficiencies, in particular by: 1) fully criminalising money laundering and terrorist financing offences, 2) addressing all the requirements on beneficial ownership, 3) strengthening the requirements for suspicious transaction reporting, international co-operation, and the freezing and confiscation of terrorist assets, and 4) fully implementing the UN conventions. Please refer to the 6th follow-up report on Guyana, available at www.cfatf-gafic-org for greater details.

 

Compliance with FATF Recommendations

The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Guyana was undertaken by the Financial Action Task Force (FATF) in 2011. According to that Evaluation, Guyana was deemed Compliant for 1 and Largely Compliant for 5 of the FATF 40 + 9 Recommendations. It was Partially Compliant or Non-Compliant for all 6 of the Core Recommendations.

 

US Department of State Money Laundering assessment (INCSR)

Guyana is categorised by the US State Department as a Country/Jurisdiction of Primary Concern in respect of Money Laundering and Financial Crimes.

OVERVIEW

 

Guyana’s geographic location makes it attractive for transnational organized crime groups, including human and drug trafficking organizations. It continues to be a transit country for South American cocaine destined for Europe, the United States, Canada, West Africa, and the Caribbean.

 

There is a culture of using informal networks to move money between Guyana and the diaspora, and Guyana has a large cash-based economy. Many criminals use cash couriers or familial networks to move large sums of money between Guyana and the United States. Unregulated currency exchange houses also pose a risk, as they are used both for the exchange of currency and to transfer funds to and from the diaspora. Additionally, casinos are legal in Guyana and pose a risk for money laundering. Guyana has one casino.

 

In 2013, the CFATF issued a public statement noting significant strategic deficiencies in Guyana’s AML regime and declaring Guyana a money laundering risk to the international financial system. Subsequently, the government created an action plan to address noted deficiencies and, in mid-2015, passed amendments to update its AML legislation to include a definition of beneficial ownership and broaden the definition of property subject to confiscation, among other improvements. In 2016, the CFATF removed Guyana from its public statement.

 

VULNERABILITIES AND EXPECTED TYPOLOGIES

 

The primary sources of laundered funds are believed to be narcotics trafficking and corruption. However, the laundering of proceeds from other illicit activities, such as human trafficking, contraband, illegal natural resource extraction, and tax evasion, is substantial. Common money laundering typologies include the use of fictitious agreements of sale for non-existing precious minerals to support large cash deposits at financial institutions; cross-border transport of small volumes of precious metals, declared as scrap or broken jewelry to avoid scrutiny by the relevant officials and the payment of relevant taxes and duties; TBML using gold; and the use of middle- and senior-aged cash couriers for the cross-border transport of large sums of U.S. dollars.

 

KEY AML LAWS AND REGULATIONS

 

The Government of Guyana has legislation in place that could enable a more effective response to the threat of money laundering. In June 2015, Guyana passed and began to enforce the Anti- Money Laundering and Countering the Financing of Terrorism (AMLCFT) Amendment Act, seeking to address remaining deficiencies in its AML regime, such as the availability of proportionate and dissuasive sanctions.

 

Guyana has comprehensive CDD and STR regulations. There is also a records exchange mechanism in place with the United States.

 

Guyana is a member of the CFATF, a FATF-style regional body.

 

AML DEFICIENCIES

 

International experts recommended Guyana make the following major improvements to its AML regime: adequately criminalize money laundering; to establish a fully operational and effectively functioning FIU; institute effective measures for customer due diligence and enhanced financial transparency; and establish adequate STR requirements. To correct noted deficiencies, Guyana passed the Anti-Money Laundering and Countering the Financing of Terrorism Regulations 2015; issued the Guidelines on Targeted Financial Sanctions 2015; and completed amendments to the AMLCFT Act in 2015 and 2016. Guyana’s AML regime also extends to legal persons and provides for enhanced due diligence for PEPs.

 

Though created in 2003, the FIU was severely understaffed and ineffective. In June 2016, a new director of the FIU was appointed, and the functional capacity of the unit has been enhanced.

 

Guyana submitted a letter of interest to join the Egmont Group of FIUs in 2011, which is still being considered.

 

ENFORCEMENT/IMPLEMENTATION ISSUES AND COMMENTS

Guyana has ratified the 1988 UN Drug Convention.

 

The major agencies involved in anti-drug and AML efforts are the Office of the Attorney General, FIU, Ministry of Finance, Bank of Guyana, Guyana Police Force, Guyana Revenue Authority, the Customs Anti-Narcotics Unit, and the Serious Organized Crimes Unit (SOCU). Although the AML legislation gives the FIU authority to investigate alleged money laundering, the FIU does not have the capacity to conduct such investigations. The SOCU investigates those cases referred to it by the FIU. The effectiveness of these agencies at investigating money laundering is limited, as they lack adequate human resources, training to ensure successful prosecutions, and a strong interagency network. Additionally, lack of cooperation by the business community also hinders Guyana’s AML efforts.

 

Despite its limited staffing capacity, in February, the SOCU seized roughly $80,000 worth of local and foreign currency and arrested two persons suspected of money laundering. This was the first seizure under Guyana’s updated AML legislation.

 

Guyana should raise awareness and understanding of AML laws and implementation procedures, through training and the publication of guidelines, within the judicial system and in agencies with the authority to investigate financial crimes. STR requirements, wire transfers, and customer due diligence regulations should be strengthened and additional resources extended to the FIU and SOCU.

 

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SANCTIONS

There are no international sanctions currently in force against this country.

 

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BRIBERY & CORRUPTION

 

Index

Rating (100-Good / 0-Bad)

Transparency International Corruption Index

34

World Governance Indicator – Control of Corruption

23

 

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INVESTMENT CLIMATE - Executive Summary (US State Department)

Guyana’s investment climate took a downward turn in 2013 as political gridlock and infighting hampered the country’s development efforts on several fronts. The Amaila Falls Hydropower Project, which would have been the largest capital project in the country’s history, fell apart after a decade of planning when U.S. developer and equity partner Sithe Global withdrew from the multinational development team in August 2013. The company had concerns related to political risk following objections to the venture by the country’s largest opposition party. Guyana’s failure to crack down on money laundering — including parliament’s inability to pass legislation strengthening Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) laws — has resulted in the country being blacklisted by the Caribbean Financial Action Task Force (CFATF). Further action by the international Financial Action Task Force could result in increased costs and delays in processing international financial and trade transactions. The government continues to encourage foreign investment, but has had limited success in attracting that investment outside of the gold mining sector. Perceptions of corruption, inefficient government, inadequate infrastructure, and crime remain barriers to attracting foreign investment.