Dr. Phillips Urges Credit Unions to Promote International Regulatory Framework

Minister of Finance and Planning, Dr. the Hon. Peter Phillips, is urging the local credit union movement to promote amongst its membership, the need to comply with international standard regulations in the financial sector.

The Minister who spoke at the opening ceremony of the Caribbean Confederation of Credit Unions on Saturday, June 23, at the Ritz Carlton Hotel, in Montego Bay, told the over 600 delegates that given the global fiscal crisis and the need to battle international terrorism and money laundering, there is no escape of tighter-run financial systems.

“The global environment is now requiring us to comply with international financial standards…recently proposed regulations that impact, or will impact, what we do here in the Caribbean include: the Foreign Account Tax Compliance Act (FATCA), and the provisions under the Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) Regime. Other institutions have been forced to comply with these statutory obligations, including building societies, banks, and securities dealers,” the Minister said.

Adding that the regulations when in full effect, will be far-reaching,  he noted that the United States- led initiative enlists assistance of  Foreign Financial Institutions (FCIs) to provide information on US citizens, legal residents, or US entities that have a legal obligation to pay US taxes or at least make US tax returns. “Some of your members may be affected by this law which becomes effective in 2013,” he noted.

Dr. Phillips said it was therefore incumbent on the leadership of credit unions to become familiar with the provisions of this Act and communicate with its membership.

“As a country, we cannot escape these realities, if we do not have an appropriate and acceptable regulatory framework, then Jamaica’s financial system as a whole is going to face difficulties. The new regulatory environment governing financial institutions will be adopted; there is simply no way around it. Not only do we have our own regulations to contend with, but if we are not to be blacklisted and isolated in the global environment, we will have to abide by international regulations,” he stated.

Minister Phillips stressed that Jamaica cannot afford to jeopardize its international standing by not complying with the requirements of the global community. He stated that communication has made the global environment very small, and with recent experiences, especially those faced by Jamaica in the mid 1990’s financial challenge, and the recent global fiscal crisis, regulations are necessary for stability and long-term growth in financial systems.

The three-day Convention will award stalwarts in the movement, as well as look at issues to strengthen its operations, and adopt positions to facilitate discussions on public policy. It will also look at sustainable development in Jamaica and the Caribbean.

By Garfield Angus, JIS Reporter