The Lower House of Parliament has approved an amendment to the Exchange of Information Act, to provide for the free flow of information upon the request of foreign regulatory authorities.
“As we all know, the Caribbean Financial Action Task Force (CFATF) in conjunction with the global financial task force, the organisation that fight against money laundering, and money crimes et cetera, they inspect the various countries ever so often, and they look at the shortfall that could come forward in the areas where we might be deficient, and they have asked us to implement certain amendments to our laws,” said the Leader of Government Business and Minister of Finance Gregory Bowen, who moved the Exchange of Information (Amendment) Bill, 2022, during a sitting of the House of Representatives on Tuesday.
He told the session that the amendment will provide for the expeditious flow of information “about somebody in our country or somebody about whom we may have certain information,” upon the request of foreign “competent authorities,” noting that the existing laws did not allow that to happen expeditiously and quickly.”
“You had to get permission…now, the global authority including our component in the Caribbean, the Caribbean Financial Action Task Force, they are indicating that the law should be amended to allow the competent authorities here when requested to give information that they need not go to anybody, once its a competent authority, then you give them the information,” said the senior government minister.
According to Minister Bowen, the amendment is being made under the condition of “reciprocity,” which was one of the concerns previously raised.
“That was one of my fears when we passed these laws back in 2014, and 2015 but I see that when we ask for information, we get it Mr. Speaker, and we get it reasonably quickly. So, I think my fear has gone a bit but it must be in our laws that you must be one (1) who has signed with us the reciprocity arrangement before we will be able to give you this. So, it’s automatic but similarly, you must be able to provide us with similar information.”
However, former Finance Minister and the current Member of Parliament for St. Patrick West, Anthony Boatswain, who contributed to the debate, expressed the view that while “we do have that international obligation to keep our society, and the global society free of terrorist financing and money laundering and other financial crimes…the word ‘exchange’ is really, a misnomer, in the sense that it is always a one-way flow.
MP Boatswain, who is an Economist by profession, strongly believes that Grenada and other developing countries should demand assistance in putting the necessary “mechanisms in place to ensure that we could generate the information they are asking us for on a regular basis.”
“The onus is always on developing countries, countries like ours to provide the information, and when we fail to do that the OECD, the other jurisdictions, they will blacklist us for non-compliance,” argued MP Boatswain, adding that “banking is a very tedious and costly activity right now because we have to comply with those international requirements.”
“So, in essence, we are paying here locally to ensure the security and safety of the bigger nations, that is what we are doing, and there is no compensation in return…So, I am saying, yes, we have to provide it (the information) but why not ask them to provide more resources to help us to do the thing that they want us to do.
“We are poor (and) those systems that we have to put in place, the manpower, the technical resource that we have to put in place to generate that information to give to them cost a lot, and we are not the beneficiaries in the long-term, they are the beneficiaries (and) they have to protect their countries and institutions that terrorist attacks.
“We don’t have terrorists attacking us in the region here. Albeit, we cannot be complacent but at the same time it is too great an imbalance, the cost for us to comply is high whereas the benefits flow in one direction primarily.
“I believe as a region we must make greater demands on those countries that are asking us to provide the information and to assist us, provide us with resources so, at least there could be greater compliance… although if we fail to, they could use the big stick, blacklist.
“When you’re blacklisted, financially you are crippled and they know that but at the same time I think as a region collectively, should be more assertive, and make greater demands from the countries that are demanding of us to provide this information primarily for their own security, not ours.”
In response to the concerns raised by the St Patrick MP, the Leader of Government’s Business acknowledged that this is an issue that “we have grappled with” referencing the charges that are applied by banks to conduct certain transactions.
“…The bank must put out a lot of resources. That’s where Mr. Speaker, perhaps the charges coming are from…you withdraw something so there is a charge, but it is because of these institutions imposing certain things on them,” Minister Bowen told Parliament.
“I am not saying all are because of those indications or concerns but yes it is something that we must address. We could only fight so much Mr. Speaker but then it always come back, the corresponding bank (says) well if you don’t want to do these things you not passing money through my bank and the matter is close because if you can’t get EC dollars through a corresponding bank in the US or some other place in Canada and the European Union then you can’t trade and so, that is the stick over our heads,” he said.
Minister Bowen went on: “So, the member is correct, we will ask, and continue to ask but in the meantime we could only push as much, and I am saying one of the push we’ve made here is reciprocity, and I think it’s a grade when the big team will go through the various countries that has to be graded.”
Under the Exchange of Information (Amendment) Bill, 2022, which now goes before the Senate for passage, the Attorney General, Registrar of Companies, as well as the Grenada International Financial Services Authority (GIFSA), Supervisor of Insurances, the Department of Cooperatives, Churches, Eastern Caribbean Central Bank (ECCB), and the Supervisory Authority will be mandated to provide information to foreign regulatory authorities freely.