Laws Strengthened to Tackle Money Laundering

The House of Representatives has approved amendments to address deficiencies in the existing laws to tackle money laundering and to ensure compliance with international anti-money laundering standards and treaty obligations.
The relevant laws include the ‘Bank of Jamaica Act’, the ‘Banking Act’, the ‘Financial Institutions Act’ and the ‘Building Societies Act’.
Piloting the Bills in the House yesterday (October 12), Finance and Planning Minister, Dr. Omar Davies explained that the amendments had arisen from the recommendations of the Financial Crimes Legislative Task Force, and included minor amendments to address omissions and errors, which emerged when amendments were done in 2002.
Providing background, Dr. Davies said the Financial Crimes Legislative Task Force, which was formed in 2002 was charged with the responsibility of identifying and pursuing legislative reforms needed to boost the country’s fight against money laundering and other financial crimes.
He said the Task Force made several recommendations relating to a number of substantive issues, which required the drafting of new laws as well as the amendment of existing ones. “Also taken into consideration were Jamaica’s international treaty obligations, particularly the prevention of money laundering and the financing of terrorism,” he noted.
The amendments in respect of the four Bills, Dr. Davies stated, were intended to “establish clear channels for the clearing of information between regulatory agencies, both domestically and internationally, with appropriate mechanisms for control”.
To this end, the Bank of Jamaica Act was amended to include more comprehensive provisions in relation to the sharing of information with overseas regulators. Meanwhile, he informed that the Banking Act, the Financial Institutions Act and the Building Societies Act had been amended to include a definition of “competent authority” as the foreign supervisory authority bearing duties and responsibilities similar to those of the Bank of Jamaica (BOJ).
Dr. Davies added that in terms of the sharing of information with domestic authorities, the BoJ had adequate provisions and it would only be necessary to add the Solicitor General to the list of individuals with whom information could be shared.
In addition, the amendments to the Acts seek to give the financial system regulators the power to take regulatory action (including the revocation of licences) in any instance where a financial institution is found to be in breach of criminal statutes relating to money laundering or any other statute relating to financial crimes.
To address omissions and errors stemming from the 2002 amendments, the definition for “regulated or supervised institution”, which was inserted under the statutes of the Banking Act, the Financial Institutions Act and the Building Societies Act, will be expanded to include financial institutions in foreign jurisdictions that are regulated or supervised by authorities bearing similar supervisory or regulatory responsibilities such as those of the BoJ or the Financial Services Commission (FSC).
In respect of the Banking Act and the Financial Institutions Act, Dr. Davies further explained, Section 19 of both Acts was being amended to address the situation where a bank or licensee under the Financial Institutions Act did not comply with the directions of the Supervisor issued under that section. The 2002 amendments addressed only the instance of non-compliance with the obligation to submit audited financial statements as required under the section.
The Finance Minister said that in identifying the omissions and errors in the 2002 amendments to the pieces of legislation, “it was also realized that there remained significant disparities between the level of fines applicable under the Banking Act and the Financial Institutions Act for offences under these Acts, with the level of fines applicable under the Building Societies Act for similar offences”.
Therefore, the amendments in this regard will see penalties under the Building Societies Act and related regulations in the BoJ (Building Societies) Regulations being synchronized with those applicable under the Banking and Financial Institutions Acts in respect of similar offences.
Amendments to the Financial Services Commission Act will be debated at the next sitting of the House on October 26.