REPORT OF ANTIGUA AND BARBUDA
TO THE CARIBBEAN FINANCIAL ACTION TASKFORCE
TOBAGO 8 - 12 APRIL 2002

Presentation made by Sir Ronald Sanders
Head of Delegation of Antigua and Barbuda

Over the past six months the anti money laundering efforts of the Government of Antigua and Barbuda have divided into three streams:

1. The consolidation of the powers and resources of the Office of National Drug and Money Laundering Control Policy (ONDCP);
2. The introduction of the necessary legislative instruments that are required to give full effect to UN resolutions relating to the prevention and suppression of the financing of terrorist acts;
3. The introduction of regulations for the effective control of Antigua and Barbuda's internet gaming industry and the creation of infrastructure to enforce these regulations.

Our resources are finite and the level of support required to service these programmes properly is considerable. In a post September 11 world; in an economy which derives 79% of its GDP from tourism, and where revenues are dropping; the maintenance of an adequate cash flow to keep these programmes going is one of our major challenges. Nonetheless our commitment to these programmes remains unwavering.

I shall now briefly summarise the current position of each programme.

The ONDCP

Legislation for providing for civil forfeiture of the proceeds of crime in money laundering cases has been drafted and is expected to be introduced into Parliament in the Spring session.

The driving force behind this proposed legislation is the observation that the vast majority of persons who commit serious money laundering offences within Antigua and Barbuda are domiciled elsewhere and launder property which is the proceeds of foreign offences.

The amending legislation is designed to reduce the dependency of our existing system -

• firstly upon the outcome of criminal prosecutions in Antigua and Barbuda which, because of international links and the criminal standard of proof, are notoriously difficult and expensive to bring to a conclusion, and
• secondly upon the outcome of foreign prosecutions and consequent MLAT requests for the enforcement of foreign freezing and forfeiture orders.

Once the amending legislation is introduced the ONDCP's capacity to freeze and forfeit money and other property laundered into the country by foreign criminals will be greatly enhanced.

In addition to strengthening the tools available to the ONDCP to combat money laundering the Government of Antigua and Barbuda has also resolved to strengthen the ONDCP itself.

This is to be done by means of the ONDCP Bill, which will also be presented to Parliament this spring. When this Bill is enacted the ONDCP will cease to be an arm of the executive and will become a statutory institution with special responsibility for the enforcement of Antigua and Barbuda's anti-money laundering legislation.

In addition to creating the institution itself, the legislation will provide for the appointment of a Director and Investigation Officers with powers (subject to judicial supervision where necessary), which will be sufficient to enable them to investigate offences against our money laundering legislation.

These powers include the power to arrest suspects and detain them for the purpose of questioning; the power to search and seize evidence of serious financial crimes pursuant to search warrant and the power to prevent the departure of suspects from our jurisdiction for a limited period while an investigation is being conducted.

This legislation will permanently establish the ONDCP as a specialist law enforcement agency directed to combat money laundering, and is a measure of our commitment to act against this insidious crime.

The challenges faced by those of us from small jurisdictions in attempting to deal with sophisticated financial crimes are very great. There is a huge gulf between the level of policing skills required to provide adequate community policing in a small, non-industrialised nation and those required to deal with transnational financial crimes.

One of our greatest priorities therefore is improving the skill levels of investigators, analysts and other support staff. Our neighbours and friends, particularly the US and the UK, have been generous in their support of our efforts to improve our skill base and we thank them for this. Some examples of training undertaken over the past few months is as follows:

• The ONDCP is equipped with LAN based computer facilities. All support staff have been provided with training in standard office programmes.
• Investigators and analysts have been issued with the sophisticated financial analysis programme: Analyst Notebook and have received training in its use. Major cases being investigated by the ONDCP are now in the process of being transferred onto Analyst Notebook.
• Small groups and individual officers have been sent on courses on money laundering enforcement; drug intelligence techniques; advanced criminal investigation; resource management and trainer training.

Terrorist Financing

Urgent responses were required to the outrage of September 11 and they were forthcoming from Antigua and Barbuda. The Prevention of Terrorism Act 2001 was passed through both houses of parliament in October 2001.

A series of directives, issued pursuant to the powers contained in the Money Laundering (Prevention) Act 1996 were given to banks and other financial institutions between September 13, 2001 and January this year, requiring checks to be made of all account holders to ensure that terrorists and entities used by terrorists were not exploiting the financial sector of Antigua and Barbuda.

There is no doubt that our anti-terrorist financing legislation was conceived and executed rapidly in response to the greatly increased threat of terrorism with which we have all had to deal since September 11. We Intend to consolidate and strengthen this legislation still further. This work is presently being undertaken by a high level committee and remains a project of the highest priority.

Antigua and Barbuda wants its financial system to be in harmony with the US Patriot Act. We have amended the guidelines relating to financial institutions requiring them to have a physical presence in Antigua and Barbuda. Those failing to shift their operations to within our jurisdiction will have their licence to operate revoked.

Internet Gaming

Antigua and Barbuda was amongst the first countries to licence interactive gaming and wagering companies and is currently the home of some of the largest gaming companies in the world.

Whilst it is the policy of the government of Antigua and Barbuda to encourage the growth of this new industry it is also government policy that it should occur in a transparent, well regulated environment that protects customers, particularly problem gamblers; prevents access to gaming sites by minors; and prevents interactive gaming companies from being used for unlawful purposes.

To this end the Interactive Gaming and Interactive Wagering Regulations 2001 were introduced and a Directorate of Offshore Gaming with an annual budget of in excess of $EC4 million has been established. The Director, Mr Ronald Maginley is present as a member of this delegation.

There is no doubt that the emplacement of a properly funded and staffed regulatory authority to oversight interactive gaming has imposed significant costs and restrictions upon the industry, in the same way that our banking regulators have imposed costs and restrictions upon financial institutions operating within Antigua and Barbuda.

One of the effects of imposing proper licensing and other regulatory requirements on internet gamers has been to cause a movement away from Antigua and Barbuda to other jurisdictions within the region where no regulation or minimal regulation is in place.

The patchy way in which:

• money laundering and other financial controls are being implemented; and
• training, legal and other resources required to bring about positive changes are being applied

is creating economic distortions within this region, the effect of which is to penalize the most compliant nations and to reward the least. The creation of the best regulations in the world and the best law enforcement structures in the world is of no use if there is nothing left to regulate.

The presence of a level playing field is of critical importance to small jurisdictions such as Antigua and Barbuda. We ask that this organization pay close attention to those of it's members who benefit from their own relative inactivity and from the diligence of others.