The House met to amend the Registration of Business Names Act to provide the Financial Services Regulatory Authority (FSRA) with discretionary oversight in the process of business registrations.
The amendments to Section 5 of the Act state that the use of the words: “assurance”, “insurance”, “money”, “currency”, “lending”, “forex”, “virtual assets”, and “mutual funds” in a business name must first be approved by the Director of the FSRA.
Similarly, if a “business engages or intends to engage in insurance business, money services business, lending, forex business, virtual assets business, mutual funds business or international financial services” permission must first be obtained from the Director of the FSRA.
This latest move by the government is in keeping with attempts to limit the de-risking in the Caribbean. “De-risking” refers to the withdrawal of correspondent banking services from a country for fear of financial crimes.
About 40% of correspondent banks have withdrawn from the Caribbean over the past 15 years, which has reduced the region’s access to international finance and credit, and has restricted cross‑border payments including remittances.
Dr. Anthony, whose premiership of Saint Lucia kept the country from suffering de-risking during global financial insecurities, argues that tighter legislation promotes financial impropriety.
“The more you have legislation that regulates, the more you have corruption. People seek to get around the legislation. People seek to avoid the bureaucracy introduced by such legislation so they buy the civil servants and buy public officials so they can get their way,” Dr. Anthony said.
The former Prime Minister describes the amendment as well-intentioned but an “overreach” as it empowers the FSRA with sway over simple transactions.
“But it is the method. Sometimes I fear that we have been creating monsters in our midst. And we have to be very careful that we do not allow a company like the FSRA to engage in behavior that we can describe as overreaching, where they want to regulate every simple living thing.”
The amendment was passed with Dr. Anthony’s approval, but the threat of losing CBRs remains alive. Based on data from the Society for Worldwide Interbank Financial Telecommunication (SWIFT), St. Vincent and the Grenadines, Dominica, the Bahamas and Jamaica had each lost more than 40% of their CBRs in 2011-20.