Antigua Observer:-The decision by international correspondent banks to terminate relationships with banks in the Eastern Caribbean Currency Union (ECCU) is encouraging money laundering and terrorist financing, the Governor of the Eastern Caribbean Central Bank (ECCB), Timothy Antoine, has said.
“If you force people to hold cash and move around cash, you are encouraging that sort of behaviour, because there is less traceability, less transparency, [and] that’s precisely what you don’t want,” the governor stated.
Over the past year or two, a number of international correspondent banks have sought to sever ties, in an attempt to manage the risk of money laundering and terrorist financing through countries in the region. But its efforts to address these risks are affecting the Caribbean as well as the international correspondent banks.
As small island states, Antoine said the money we’re making through correspondent banking is not worth the fines we would be required to pay if the ECCU banks are caught harbouring funds which turn out to be illegal or ill-gotten. “We may be making a million dollars but we may have to pay a fine of 50 million dollars,” he declared.
Nonetheless, the region is highly dependent upon correspondent banking and the ability to access international financing systems, in order to perform the simplest of tasks such as receiving remittances or performing wire transfers.