Former director designate of the Financial Intelligence Unit (FIU), David West, yesterday welcomed the news that Trinidad and Tobago was no longer being monitored by the Financial Action Task Force (FATF).
He however pointed out that there were still deficiencies in the financial system.
Speaking at the Caribbean Public Procurement conference which concluded yesterday at the Hyatt Regency in Port of Spain, West observed that the wording of the statement, which was issued yesterday following a three-day plenary meeting in Paris, focused on significant progress that the country had made in dealing with anti-money-laundering and combating the financing of terrorism (AML/CFT).
The statement yesterday said FATF welcomed the progress Trinidad and Tobago had made and pointed out it had established the legal and regulatory framework to meet its commitments in its Action Plan regarding the strategic deficiencies that the FATF had identified in February 2010.
West said the country has to be compliant for the fourth round mutual evaluation by mid-2014 because T&T will be re-evaluated through FATF's 40 recommendations. He observed that T&T still needed legislation to deal with certain recommendations such as weapons of mass destruction and politically exposed persons as well as the passage of the Securities and Exchange Act.
West also said the former People's National Movement (PNM) government made a mistake in setting up an administrative type FIU in Trinidad and Tobago.
Instead, he believes the country should have set up a law-enforcement type FIU.
West said there was a perception an administrative type FIU (unless truly independent) is subject to the direct supervision of political authorities. He observed that although the FIU has a budget, approvals to spend the money still needed to be passed by the permanent secretary.
"Although this type of FIU is preferred by the banking sector to be a "buffer" between the financial institutions and law enforcement sectors there are several disadvantages we are now seeing. For example, there is the delay in applying law enforcement measures, like freezing a suspicious transaction or arresting a suspect on inadequate financial disclosures," he said.
He noted that before the FIU Act was passed the Counter Drug Crime Task Force existed which operated like a law enforcement-type FIU and which had success in gathering evidence in many high-profile matters.
"The advantage was that information could have been exchanged using the extensive international criminal information networks. Immigration, Customs and police officers were housed in the same building as the analysts who were not afraid to share information," he explained.
Now, said West, there appears to be a duplication of work.