Stephen Vasciannie
WHEN PEOPLE involve themselves in drug-trafficking and other illegal activity, they frequently find it necessary to devise means to mask the fact that their sources of wealth are built on criminality. This simple fact has given rise to the modern device of money laundering.
At its core, then, money laundering is a method of deception; it seeks to create the impression that there is a legitimate source for wealth that has been acquired by "dirty" means. The launderer may be the man next door; but you may not know it, for the better he covers his tracks, the cleaner his source of income may seem to be.
Thus, it follows that if the state is serious about undermining the illegal drug trade, it needs to trace the flow of funds to the suspected drug-trafficker. In some instances, drug dealers may be caught in flagrante delicto, but more often than not, the proverbial "Mr. Bigs" will only be cornered through a careful study of the sources of their income and their attempts to launder proceeds from illegal activity.
With this background in mind, it is important yea, even relevant for Caribbean scholars to examine both the methods that have come to be associated with money-laundering and the legislative responses that have emerged to counter money-laundering in recent years. One such scholar, Dr. Shazeeda Ali, a lecturer in the Faculty of Law at the University of the West Indies, Mona, has devoted three years or so to this issue, and has produced a tour de force under the title Money Laundering Control in the Caribbean (published by Kluwer International).
In approximately 300 pages the publication takes the reader through the main issues that have arisen in this area of the law, primarily (but not exclusively) with reference to the jurisdictions of the Bahamas, the Cayman Islands and Jamaica. Among the issues explored by Dr Ali are the nature of money laundering, the putative relationships between some offshore financial havens and money laundering, and the evolution of money laundering control. But, true to her legal calling, Dr. Ali also explores issues such as confiscation and forfeiture of assets, criminal and civil liability for laundering, and other legal devices designed to control money laundering.
When I first read this book, I was inclined to the view that there were really two books within the covers of Money Laundering Control in the Caribbean. The first is about the law, and the law's response to money laundering, as noted above. The second book, however, is about public policy in the region, and specifically, about how the main political and economic features of the Caribbean promote, and are affected by, the problem of money laundering.
So, with reference to the second public policy book there is a substantial discussion on Caribbean vulnerabilities and risks in respect of money laundering in Chapter 1. Here, Dr. Ali discusses how the well-known constraints of geographical location and limited resources restrict our capacity to fight money laundering; and, at the same time, she demonstrates how considerations such as the organisation of the gaming industry in some countries, the ubiquitous presence of the U.S. dollar in the region, and the cash-orientation of Caribbean societies all encourage money laundering in one way or another. This is excellent political analysis informed by a firm legal foundation.
On further reflection, though, there may be yet another book within these covers. This is so because, in addition to her erudite discussion on the domestic laws of individual Caribbean States, and her extensive review of public policy factors, Dr. Ali also addresses, in a substantial way, the international law dimensions of the money laundering problem.
As to this third aspect, precisely because laundering is a method of hiding away tainted money, and rejuvenating it in untainted condition, money launderers hardly ever rely on one method of laundering. As Dr. Ali puts it, "the techniques invoked to obscure the source of illicit funds are rarely one-dimensional, but rather, usually structured in such a manner as to resemble 'a mosaic or kaleidoscope'". The existence of this multi-dimensional approach by the thieves, requires that the police must use international means of protection.
Thus, money laundering is an international problem, and since the decade of the 1980s, countermeasures against money laundering and predicate offences, have been taken pursuant to international law. So, for instance, the 1988 Convention against the Illicit Trafficking of Narcotic Drugs and Psychotropic Substances reaffirms the criminalisation of money laundering and encourages the confiscation of criminal proceeds across borders.
In the same vein, groups such as the Financial Action Task Force (FATF) and the Caribbean Financial Actions Task Force, as well as the Commonwealth Secretariat, all operate on the assumption that international law rules and international co-operation can play a significant role in reducing money laundering activities. Not surprisingly, therefore, Dr. Ali explores questions such as the "long arm" jurisdictional approach of the United States, and touches thereby on the international implications of the American tendency to extra-territoriality in the application of its laws.
Such issues, in the hands of some analysts, become simply an attempt to condemn the United States in all circumstances. And, similarly, when some commentators come to consider the nature of the money laundering problem in the Caribbean, there is a tendency to look for the nearest mountain of sand into which we may bury our heads.
Neither of these charges may be directed at Money Laundering Control in the Caribbean. Rather, throughout the text, the analysis is even-handed, careful, and tightly argued. Dr. Ali has produced an outstanding work of scholarship which will guide public policy in the region for many years.
Stephen Vasciannie is professor of International Law and head of the Department of Government, UWI. He is also a consultant in the Attorney-General's Chambers.
