“The Central Bank always look at procedures
related to money-laundering and the provisions
under the Proceeds of Crime Act.”
Former finance minister, Selby Wilson

Former finance minister, Selby Wilson, is questioning the role of the Central Bank in the financial sector, now that the Financial Intelligence Unit Bill (FIU) has been passed. “They make no reference in the bill to any collaboration with the Central Bank,” he said on Thursday. Wilson said all financial institutions had a responsibility to report to the Central Bank. “The Central Bank always look at procedures related to money-laundering and the provisions under the Proceeds of Crime Act.” Wilson said the Central Bank had a responsibility to maintain a registry of people suspected of “doing these things.”

However, the first function and powers of the FIU under part three 7(1) says: “The FIU shall be the primary institution for the collection, analysis, dissemination and exchange of financial intelligence and information among law enforcement authorities, financial institutions and listed businesses in Trinidad and Tobago and internationally.” Wilson said the Central Bank would “look to see if they (institutions) are adhering strictly to money-laundering procedures.”

But the bill says: The FIU shall also implement a system for monitoring the effectiveness of its anti-money-laundering policies, by maintaining comprehensive statistics on: suspicious transaction or suspicious activity reports received and transmitted to law enforcement; money-laundering investigations and convictions; property frozen, seized and confiscated; and international requests for mutual legal assistance or other co-operation.

No role change
However, Inspector of Financial Institutions, Carl Hiralal, says the FIU does not change the regulatory role of the Central Bank. “The regulator is responsible for ensuring that financial institutions comply with all laws and regulations that are applicable to them—not just the FIA or the Insurance Act.” Hiralal said in order to ensure effective compliance by financial institutions, there would always be co-operation between the regulator and the FIU. “This is not a matter of control; it is more effective and cost-efficient for the regulator to work with financial institutions to deal with those aspects of the anti-money laundering (AML) laws that impact them.” He said an AML guideline that banks and insurers followed had already been issued. “This guideline will obviously need to be updated as a result of the new legislation.”

Political Interference
Wilson was also concerned about the likelihood of political interference in the process of the FIU, if placed under the direction of the Finance Minister, “Particularly since this government has the propensity to interfere with institutional arrangements. “If you look at their record, all the institutions have collapsed with political interference, such as the Integrity Commission.” On a positive note, Wilson said the FIU should benefit society. “If the underground economy becomes too dominant, then the real economy is paled in significance, which can lead to an escalation of criminal activity.”