Having now fully satisfied the action plan given by the Financial Action Task Force (FATF), the Cayman Islands is eligible to be removed from the list of countries the FATF is monitoring for deficiencies in their anti-money laundering and countering the financing of terrorism (AML/CFT) regimes, subject to successful completion of an onsite visit by the FATF.
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Introduction
It was submitted by the parties to the claim, the Jamaican Bar Association (JBA) and the General Legal Council (GLC), that certain aspects of AML/CFT regime1 of Jamaica, as it related to Attorneys-at-Law, erodes the essential confidentiality of the lawyer-client relationship and is incompatible with the Constitution of Jamaica, thus putting the continued integrity of legal professional privilege (LPP) at risk. The ability of Jamaican citizens to obtain reliable legal advice and representation rests on LPP.
The JBA is a company incorporated in Jamaica whose members are Attorneys–at–Law and whose objectives are (among other things) to promote the interests of attorneys in Jamaica. The GLC is the statutory body in Jamaica responsible for regulating the legal profession.
Litigation History
The JBA brought a claim seeking declaratory relief, injunctive relief, and other constitutional redress against the Attorney General and the GLC. On 4 May 2017, the Full (Constitutional) Court of Jamaica dismissed the JBA's claim and declared that the AML/CFT regime was constitutional. The JBA appealed. On 30 July 2020, the Court of Appeal of Jamaica allowed the JBA’s appeal in part. The Court of Appeal considered that certain of the provisions which form the AML/CFT regime contravened the Charter of Fundamental Rights and Freedoms whereas other provisions were valid and lawful. With leave of the Court of Appeal, the GLC and the Attorney General appealed to the JCPC.
Facts
Paragraphs 2 and 3 of the Proceeds of Crime (Designated Non- Financial Institution[DNFI]) 2 (Attorneys -at-law) Order 2013, defined Attorneys-at-law as NFIs because of certain activities they engaged in on behalf of any client which fell within any the following six categories of professional services: (a) purchasing or selling real estate; (b) managing money, securities or other assets; (c) managing bank accounts or savings accounts of any kind, or securities accounts; (d) organizing contributions for the creation, operation or management of companies; (e) creating, operating or managing a legal person or legal arrangement (such as a trust or settlement); or (f) purchasing or selling a business entity as reflected by FATF Recommendation 22.
Being designated as an NFI meant that Attorneys-at-Law were subject to the relevant provisions of the Jamaican Proceeds of Crime Act (POCA). The GLC has previously argued that the inclusion of Attorneys-at-Law in the regulated sector gave rise to additional obligations (over and above any which currently apply) which impact on the general duties of confidentiality owed by attorneys to their clients and their duty to preserve the privilege of their clients not to disclose certain communications.
The JBA considered that the duties imposed by the AML/CFT regime upon Attorneys-at-Law are unconstitutional because, inter alia, they undermined legal constitutional rights to liberty [s.13(3)(a) and s.14 of The Charter of Fundamental Rights and Freedoms (Constitutional Amendment) Act, 2011, privacy (including LPP) [s. 94 POCA-Suspicious Transaction reporting obligation] and protection from search of property [s. 91A POCA - inspection].
The JBA focussed its challenge on those provisions of the AML/CFT regime which, it says, violated for them or for their clients the guaranteed rights of privacy, liberty and freedom from search.
JCPC Judgment
The JCPC heard the appeals on November 29 and 30, 2022 and declared on February 9, 2023 that the AML/CFT regime of Jamaica does not contravene constitutional rights of attorneys and clients.3 Therefore, the decision of the Full (Constitutional) Court of Jamaica upholding the relevant AML/CFT legislation as it applies to Attorneys-at-Law should be restored.
Footnotes
1 The Jamaican statutory regime to combat money laundering is comprised of primary legislation, secondary legislation, and non–statutory guidance.
2 Equivalent to the FATF definition of Designated Non-Financial Businesses and Professions (DNFBPs).
3 The Attorney General (Appellant) v The Jamaican Bar Association (Respondent) (Jamaica); The General Legal Council (Appellant) v The Jamaican Bar Association (Respondent) (Jamaica) [2023] UKPC 6
On appeal from The Court of Appeal of Jamaica
The Minister of Finance of Trinidad and Tobago, the Honourable Mr. Colm Imbert stated that there were 958 suspicious transaction reports/suspicious activity reports (STRs/SARs) valued at TTD $1,937,211,057 up to September 30th, 2022 reported by the Financial Intelligence Unit of Trinidad and Tobago (FIUTT). The STRs/SARs were based on tax evasion, fraud, money laundering and drug trafficking activities. The Minister elaborated by noting that the most prevalent reason for STRs/SARs filings was suspicious activity, which accounted for 301 persons, “followed by tax evasion (211 persons), fraud (196 persons), money laundering (155 persons) and drug trafficking (35 persons).” The Minister further disclosed that these accounted for 94 percent of the total STRs/SARs received by the FIUTT and 60 per cent of the total monetary value of all STRs/SARs submitted.
Regarding the type of transaction, it was revealed that 844 reports were completed transactions while 195 were attempted transactions, valued at TTD $1,586,346,802 and $350,864,255 respectively. However, 16 STRs/SARs contained both completed and attempted transactions. He further stated that “this represented a 24 percent decrease in completed transactions and a 68 percent decrease in attempted transactions when compared to the previous reporting period.”
Minister Imbert also highlighted that there was an increase in requests from foreign law enforcement agencies and FIUs with the local FIU for cooperation on these matters. More specifically, the requests were related to 85 subjects in comparison to 26 for the comparative period in 2021. Four (4) other requests sought intelligence on 34 subjects. Requests from foreign authorities originated mainly originated in the Caribbean, the Middle East and Europe. Similarly, the FIUTT sent 23 requests about 45 subjects to foreign authorities for financial intelligence and information to foreign authorities mainly in the Caribbean, the Americas and Asia. The requests sent included 11 cases of suspected fraud and five (5) cases of drug trafficking.
Additionally, the FIUTT disseminated 12 spontaneous disclosures to foreign FIUs and law enforcement agencies. Minister Imbert said, “the spontaneous dissemination of intelligence was linked to the suspected criminal conduct related to fraud and money laundering, accounting for 83 per cent and 17 percent of the total number of spontaneous intelligence reports disseminated, respectively.” He also noted that the FIUTT has 36 Memoranda of Understanding (MOUs) with foreign FIUs, with the most recent being with the superintendency of banks in Guatemala in 2022.
The Minister indicated that the FIUTT reported higher levels of compliance with anti-money laundering, counter terrorism financing and counter proliferation financing. However, based on Quarterly Property Terrorist Reports (QTRs) which continued to be implemented during its reporting period, he added that “there is a need for improved compliance by the credit union sector.” There were 457 new entities were registered with the FIUTT, with the highest number of new registrants coming from the real estate and attorney-at-law sectors.
Minister Imbert said that the FIU will improve its internal operations and “place priority on matters relating to increasing the number of intelligence products to a wider section of stakeholders.”
The Government of Guyana conducted a Civil Asset Recovery workshop on July 19th and 20th, 2022 at the Guyana Marriott Hotel in Kingston. The workshop was an initiative of the Caribbean Basin Security Initiative (CBSI) Anti-Crime Program. The Government of Guyana also collaborated with the United States Department of State’s Bureau of International Narcotics and Law Enforcement Affairs (INL) and the National Centre for State Courts (NCSC) for the workshop. The United States Ambassador to Guyana, Ms. Sarah-Ann Lynch, noted that the workshop aimed to “forge and strengthen partnerships, share best practices, and strengthen our response to serious, transnational and financial crimes”. The Ambassador went on to say that the program adopted a regional approach to tackling narcotics, trafficking, and other forms of serious organized crimes through asset recovery and robust anti-money laundering (AML) measures.
There were multiple agencies represented at the workshop. These included the Financial Intelligence Unit (FIU), Customs Anti-Narcotics Unit, Criminal Investigation Department and Special Organized Crime Unit, the Office of the Director of Public Prosecutions (DPP), Attorney General’s Chambers, the Guyana Revenue Authority as well as agencies that manage Guyana’s petroleum reserves. Expert speakers from across the Caribbean, Canada, and the United Kingdom facilitated the workshop.
Ambassador Lynch noted that asset forfeiture is an essential tool in the country’s efforts to combat financial crimes as it removes the profit from crime and acts as a deterrent to future crimes. She further stated that while Guyana has various laws regarding asset recovery, “there is a need to build capacity on how to effectively implement and use these laws. We come together to enhance our knowledge of the law and share regional and international best practices. This will build expertise in conviction-based and non-conviction-based asset recovery in Guyana”. Ambassador Lynch expressed hope that the workshop will encourage “a shared sense of purpose, a vested interest in asset recovery, and an understanding of how to use the tools available to successfully prosecute financial crimes”.
At the opening ceremony, the Attorney General and Minister of Legal Affairs, the Honourable Mohabir Anil Nandlall SC, remarked that the objectives of the workshop were to increase knowledge and build confidence in civil asset recovery through legislative overview, practical case identification exercises, cross-agency team building, case studies and interactive table-top exercises. He emphasised that it is important for State agencies in Guyana to constantly enhance their capacity to punish and deter criminal activity by depriving criminals of property used in or acquired through criminal activities. Therefore, it is critical for law enforcement agencies to be cognizant of the powers contained in legislation as well as the challenges in investigating and prosecuting assets recovery cases.
The Bahamas was removed from the European Commission’s List of Third-country Jurisdictions which have strategic deficiencies in their AML/CFT Regimes (AML Blacklist). This decision was finalized on January 7th, 2022, after The Bahamas was assessed under the European Commission’s revised methodology for identifying high-risk third countries in the last quarter of 2021.
The FATF de-listed The Bahamas from the list of Jurisdictions under Increased Monitoring in December 2020 after the country addressed the strategic deficiencies identified by the FATF. However, in April 2021, the European Commission identified deficiencies that the jurisdiction needed to address to meet the Commission’s required standards. According to a release by the Council of the European Union on January 10th, 2022, “The Bahamas has implemented measures which are sufficiently comprehensive and that meet the necessary requirements to consider that strategic deficiencies identified under article 9 of the Directive (EU) 2015/849 have been removed”. The measures taken by The Bahamas have strengthened its AML/CFT framework and focused on the transparency of its beneficial ownership regime. The European Commission stated that it will continue to work in collaboration with the FATF and CFATF to monitor the development of The Bahamas’ AML/CFT regime.
In addition to The Bahamas, The European Commission concluded that Botswana, Ghana, Iraq and Mauritius no longer have strategic deficiencies in their AML/CFT regime. In its Official Journal on February 21st, 2022, the EU noted that these countries have “strengthened the effectiveness of their AML/CFT regimes and addressed related technical deficiencies to meet the commitments in their action plans regarding the strategic deficiencies that the FATF identified as well as the Commission’s additional benchmarks or concerns”.
