SO, WHAT IS THE EXTENT OF MONEY LAUNDERING?

In his address to the annual awards ceremony of the Guyana
Manufacturing and Services Association (GMSA), two Saturdays ago
President Jagdeo challenged the widely held belief that a significant
part of the economy is being buttressed by laundered money. He
referred to a statement made by a member of the private sector that
80% of the economy was based on drug money.

"I don't have a problem with anyone making that assertion", the
President said, adding however that when the annual US State
Department Report on the narcotics trade and laundering had been
published he had called the US embassy and asked how the figure
contained in that report had been estimated but was still to receive
the methodology.

"The wild assertions are not enough", the President thundered adding
that in 2006 there was an inflow of US$1.02B inclusive of remittances
and "I don't have here a line called drug money".

We agree that wild assertions are not acceptable but perhaps amid the
friendly and warm environment in which he made his declaration
President Jagdeo might have forgotten that he is yet to tell the
country what he knows of the extent of money laundering in the
country. Is it 80% of the economy? The President says no. Is it 60%,
50%, 10%? Or doesn't he know or want to know?

And that is the crux of the matter. As long as the President and his
government continue to deny that there is a money laundering problem
it will always be the elephant in the room and any number of persons
will essay attempts at determining its size and characteristics.

In countries like Guyana which have unwittingly and unwillingly
become intermediaries in the supply of cocaine, the onus is on the
state to determine the extent of the problem and to craft solutions.
It is not the role of the US State Department or the US embassy or
the businessman at the private gathering.

This is where the President's attempt to denounce the money
laundering argument amounts to mere bluster and rhetoric. His
governments - he has now been President for nine years - have
abjectly failed to install the legislative and enforcement machinery
needed to effectively crack down on the drug trade. The result has
been that conditions enabling the drug trade and money laundering
have thrived. The numerous edifices that have sprung up around the
retail, sport and other sectors beg the question of how the size of
their investments could be matched with the low growth economy and
generally depressed business.

Two years after he became President, the Money Laundering Act was
passed in 2000. Five years after the passage of that Act, the
government was still promising the full operationalisation of the
Financial Intelligence Unit (FIU) provided for under the Act and
pledging to implement the necessary regulations, staff the unit with
the required experts and make it an autonomous agency.

2007 is now drawing to a close and the government is still to live up
to its promise to replace the still-born 2000 Act with a new one
which caters for asset seizure and forfeiture. Can this government
really be serious about finding out about the extent of money
laundering and acting against it?

There has not been a single prosecution under the 2000 Act and the
FIU has never been heard from or the fruit of its labours presented
to the public. And there is no doubt that the drug trade has
flourished and that the fight against it is being waged at US and
other foreign ports and in courtrooms in the US and further afield,
but not in Georgetown. The evidence is there in the cargoes of
cocaine that have been seized abroad after being shipped from Guyana
in a variety of now famous containers: timber, rice, coconuts,
molasses, fish, etc. The evidence is also there in the courtroom
deliberations and revelations mainly in New York.

It was only on Thursday that the Acting Crime Chief made bold to say
that the police believed that indicted businessman Roger Khan had
been involved in drug trafficking. Over that period of time did the
government and its FIU ever try to determine whether Mr Khan's
business operations here had legitimate underpinnings? Or gather
evidence against him while he allegedly assisted in the crime fight?
Did it do this for any of the other business persons held in
connection with drugs? Thus far, the government's fight against drugs
has been a sham.

There is also another serious consequence of this dereliction of duty
and insouciance. The last 10 years or so have been littered with
inexplicable killings and other bloody violence more than likely the
result of narco-terrorism. The unwillingness to act against the drug
trade may have brought ephemeral benefits in the form of money pumped
into the economy, but it has also exacted much violence, bloodshed
and death.

The public awaits the swift activation and enlivening of the new
money laundering legislation.