PM tells U.S. legislators: De-risking poses serious threat
Washington, D.C. – Prime Minister Mia Mottley made an impassioned plea on Wednesday for the United States to reverse its decision regarding correspondent banking in the Caribbean telling American legislators not to allow “this to be recorded as unconscious bias”.
Mottley, flanked by several Caricom prime ministers, said she believes the Committee had a “keen eye for fairness and equity” and appealed for a level playing field when she testified before the United States House of Representatives Committee on Financial Services.
“Look at the list of countries who are listed and you will see they are all former colonies and people of colour,” the prime minister said.
“And look at the countries, in spite of being able to open a bank account in hours in Delaware or Wyoming, within hours in Luxembourg or Zurich, and they remain off of this list that speaks about the risk to money laundering and look and see where the divide comes.”
Mottley told the hearing on “When Banks Leave: The Impacts of De-Risking on the Caribbean and Strategies for Ensuring Financial Access”, that one of the solutions, which the Caribbean would like to see is the U.S. Treasury being “truthful to its mandate”.
“It says it wants to be risk sensitive, well if it wants to be risk sensitive then it needs to focus on where the money is rather than creating rules that act as a proxy to money laundering or terrorism financing, and it has found the answer, even if fortuitously or scientifically this year … with the Russian sanctions,” she said.
The Committee hearing follows a similar session held earlier this year in Barbados involving the Committee’s chairman, Maxine Waters, and other U.S. legislators.
The prime minister said she wanted to thank the Committee “for seeing us, for hearing us, feeling us because for too often we have not done so”.
“We are here because we are fighting for a global public good, and we are fighting for the human rights of our citizens,” she said. “This Committee has already expressed its concern about financial exclusion of the American population … our people are no different.”
She told the legislators that growing up in the Caribbean, opening a bank account was regarded as part of the “right of passage to becoming an adult”.
“Today, it is now a ‘gigantean’ obstacle for us to have our people do so,” she said.
Mottley said foreign investors and locals alike spend “weeks and months” trying to open a bank account as individuals to live and as companies to trade in business.
“Our economies cannot function on their own,” she said. “We do not make enough clothes, we do not produce our own food, we do not produce our own equipment, and therefore unless we are able to trade with the rest of the world, we are at risk of becoming financial pariahs.
“We are here because the listing process that has taken place whether through the Financial Action Task Force (FATF), the OECD (Organisation for Economic Co-operation and Development), or further, as a result of actions taken for enhanced due diligence by those who take listing from the FATF or the OECD,” she said.
The prime minister said it meant that correspondent banks over the past 10 to 12 years have made a judgement that Caribbean economies are simply too small because the enhanced due diligence means increased costs of regulations and increased costs of compliance.
She said rather than do business with the Caribbean, these banks say, “thank you, but no thank you”.