BY VANESSA C. ROLLE Guardian Staff Reporter

Attorney General Alfred Sears completed his tenure as chairman of the Caribbean Financial Action Task Force (CFATF), after leading the body through challenges such as money laundering and combating financial terrorists in the region.

He said however, that The Bahamas stands at the forefront of international standards in anti-money money laundering efforts and combating the financing of terrorists.

"It is imperative that The Bahamas continue its lead in this regard and ensure that our legislation keep track of the changing typologies used by our money launderers and persons who finance terrorist acts.

"We must continue to interact meaningfully with our international partners and encourage capacity building. Actively participating in the events sponsored by CFATF would assist us in achieving this objective," Mr. Sears told the House of Assembly on Wednesday.

Two weeks ago, Mr. Sears turned over the chairmanship of that organisation to Sir Ronald Sanders of Antigua and Barbuda after completing one-year.

His major challenge as chairman was the issue of the International Monetary Fund/World Bank's Methodology for Assessing Compliance with the Anti-Money Laundering and Combating the Financing of Terrorism Standards, he said.

"Participating in the CFATF put The Bahamas at the forefront of international standards of money laundering and combating financial terrorists."

Also during his tenure, Mr. Sears said he tried to increase the capacity of the CFATF and its experts, increase international cooperation, as well as increase and improve the relationship with international partners.

In participating in the Mutual Evaluation Programme, which is an assessment of a country's compliance with international standards in the fight against money laundering and combating the financing of terrorism, some nine evaluations were put forward for ministerial endorsement, he said.

Six were endorsed at the Nassau Ministerial in Oct. 2002, and the final three reports for Antigua and Barbuda, Barbados and the Turks and Caicos Islands were endorsed at the Antigua Ministerial in October.

"A first draft of the country reports have been prepared and should be finalised for release in the near future. These reports reflect the current anti-money laundering and combating the financing of terrorism infrastructure of all CFATF members," Mr. Sears said. Such reports will be updated annually.

There was a review of the FATF Forty Recommendations on Money Laundering with the Revised Recommendations being endorsed by the FATF Plenary in June 2003.

At the Antigua Ministerial, the CFATF endorsed these recommendations, which were further benchmarked for the third round of Mutual Evaluations.

Member countries were also encouraged to begin the implementation process by reviewing and amending their laws to ensure compliance with these international standards.

Many initiatives were also pursued through Plenary Meetings over which he presided he said. One held in Antigua and Barbuda in October, yielded the endorsement of following best practice papers prepared by the FATF, which provides direction on the implementation of the Eight Special Recommendations on Combating the Financing of Terrorism.

This includes the freezing and confiscating of terrorist assets, combating the abuse of alternative remittance systems, wire transfers and combating the abuse of non-profit organisations.

A methodology document developed from the FATF 2002 Plenary was presented to the CFATF in Oct. 2002, and members were unable to endorse it claiming insufficient time for consideration, Mr. Sears noted.

The Ministerial Council was also unable to endorse the use of the new ANL/CFT Methodology in Mutual Evaluations Programmes said Mr. Sears, even though it acknowledged that the IMF was using it to monitor countries in the Offshore Financial Centre and the Financial Sector Assessment Programme (FSAP) assessments.

"The passage of time led to close collaboration with the IMF and the World Bank on clarifying issues surrounding the methodology, particularly in the Organisation of Eastern Caribbean States," he said. Adding that the IMF and World Bank conducted training workshops on the methodology for CFATF mutual evaluation examiners while also providing significant funding and human resources to this effort.

This collaboration later led to particular endorsements with respect to the IMF/World Bank AML/CFT Methodology.

The Antigua Ministerial Meeting endorsed in principle, the use of a common and mutually agreed methodology in the assessment of Anti- Money Laundering/Combating the Financing of Terrorism (AML/CFT) Regimes globally; to continue to use the IMF/World Bank Methodology for the completion of the second round of mutual evaluations where countries to be evaluated so agree.

They also agreed to participate in the Post Pilot Review of the Use of Methodology slated for Dec. 2003 in Washington D.C.; and affirmed that the peer review process will continue to the underlying principle for the CFATF Mutual Evaluation Programme Mr. Sears said.

Further, as a general rule, CFATF will do a mutual evaluation of a member jurisdiction simultaneously with an IMF/World Bank FASP/OFC, and the CFATF assessment will be accepted by the IMF/WB in their normal review process he said.

Adding that in cases where AML/CFT Assessments have already been conducted by the IMF/WB and the jurisdictions concerned, the CFATF will sue the AML/CFT Assessments in its normal review process as if it were a CFATF mutual evaluation.

Having also promoted a forum on money laundering under the auspices of the U.N. for the production of a United Nations Convention on Money Laundering, Mr. Sears said, "It was my opinion and that of CFATF member countries that such a convention would allow for the establishment of international standards of money laundering, which would be applied equally to all nations and where all member countries of the U.N. would have the right to participate in the making of the rules and ensure the even application of the rules."

He said that the global forum was necessary to increase the legitimisation of the process of establishing rules for the anti-money laundering regime by universal participation of all U.N. members.

"One of the highlights of my chairmanship is the fact that I have been able to promote enhanced international cooperation between CFATF members and their international counterparts," he said.

He also encouraged greater cooperation with the other FATF-style regional organisations, and the promotion of a Regional Association of Compliance Officers, which was recently, established incorporating Compliance Associations of The Bahamas, The Cayman Islands, the British Virgin Islands, Barbados, and Trinidad and Tobago, he said.

"The regional association has as its goal, the promotion of sound compliance standards and good governance through the encouragement of the formation of national associations," he said.

"I have encouraged the provision of technical assistance bases on the concept that we live in an interdependent world and in order to defend our respective sovereign space, we need to ensure that every area of the world has adequate capacity to withstand the menace of money laundering and financing terrorism," Mr. Sears said.

Caption: Alfred Sears, Attorney General

Posted: Friday November 7, 2003