The Financial Investigations Division Act, 2008"
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REPORT OF THE JOINT SELECT COMMITTEE ON ITS DELIBERATIONS ON THE BILL ENTITLED: "THE FINANCIAL INVESTIGATIONS DIVISION ACT, 2008" Members of the Honourable House are reminded that, on June 9, 2009 the Minister of Education and Leader of Government Business in the House of Representatives having obtained suspension ofthe Standing Order moved the following motion. BE IT RESOLVED that, notwithstanding Standing Order 68 (3), this Honourable House of Representatives appoint a Special Select Committee comprising the following Members: Honourable Audley Shaw, Chairman Honourable Karl Samuda Dr. the Honourable Christopher Tufton Mrs. Marisa Dalrymple-Philibert Mr. Clive Mullings Dr. Omar Davies Mr. Peter Bunting Dr. Peter Phillips To sit jointly with a similar Committee to be appointed by the Senate to consider and report on the Bill shortly entitled: "The Financial Investigations Act, 2008." On June 19,2009, the Senate on a motion moved by the Attorney General, Minister of Justice and Leader of Government Business having obtained the suspension of the Standing Orders moved the following motion: BE IT RESOLVED that notwithstanding Standing Order 66 (3), this Honourable Senate appoint a Special Select Committee comprising ofthe following Members: Senator the Honourable Donald Wehby Senator the Honourable Arthur Williams Senator Arnold J. Nicholson Senator Mark Golding to sit jointly with a similar committee appointed by the House of Representatives to consider and report on the Bill shortly entitled "The Financial Investigations Division Act, 2008." On October 11, 2009, the Honourable Senate on a motion moved by the Attorney General, Minister ofJustice and Leader of Government Business having obtained the suspension ofthe Standing Orders moved a further resolution to delete the name "Donald Webhy" and substitute the name "Dwight Nelson" therefor. Your Committee commenced its deliberations on the Bill on July 22, 2009 and held a total of seven (7) meetings, the last ofwhich took place on March 3,2010. (Appendix 1) Your Committee recognizing the importance of the Bill and the need for public consultation and participation wrote to various groups that it believed would have an interest in the subject matter. A special appeal was made to the media houses to publicize the Committee's invitation to members of the public and institutions to make submissions to the Committee. As a result, an article was published in both The Gleaner and the Jamaica Observer on July 24, 2009, inviting the public to make submissions to the Committee on the Bill. Three (3) groups made written presentations and subsequently made oral presentations to your Committee. These included the following: The Jamaica Bankers' Association -The Norman Manley Law School The Jamaican Bar Association Your Committee received technical assistance in its deliberations of the Bill from representatives from the Office of the Parliamentary Counsel, the Attorney General's Chambers, the Legal Reform Department, the Financial Investigations Division, the Financial Services Commission, the Office of the Director of Public Prosecutions, the Bank of Jamaica and the Ministry of Finance and the Public Service. 2 1. OVERVIEW OF THE BILL The issue of financial crime is one that every country must address in a deliberate and effective manner. The expansion of business across borders, emerging technologies, and complex financial products and arrangements create opportunities for criminals to unlawfully appropriate and divert funds, launder money and otherwise disguise the proceeds of crime. Financial crimes result in the loss of millions of dollars to the Jamaican economy and cause serious damage to the efficiency and reputation of the financial institutions and financial markets. These crimes are often very complex in nature and, may involve a wide range of illegal activities requiring responsive measures utilizing highly, trained investigators, attorneys-at-law, forensic accountants and analysis and asset managers. In recognition ofthe need to address the multi-dimensional problem comprehensively, the Bill seeks to establish a department of Government to be known as the Financial Investigations Division with responsibility for (a) the investigation of financial crimes, namely offences involving money or other benefits, including offences involving fraud, dishonesty, money laundering or the financing ofterrorist activities; (b) maintaining intelligence databases on, inter alia, the types of financial crimes and the methodologies used in committing these crimes; and (c) the compilation and publication of statistics on matters such as investigations, prosecutions, convictions and assets relating to financial crimes, for dissemination to other law enforcement agencies, regulators and policymakers. The Bill further provides for (a) the appointment ofofficers ofthe Division; (a) obligations for secrecy; and (b) the sharing of information with other law enforcement and financial regulatory agencies both within Jamaica and outside of Jamaica, within well defined parameters. The Bill also provides the Division with several key investigatory powers, including those of making application to the Court for inter alia search warrant and monitoring orders. 3 2. FINDINGS AND RECOMMENDATIONS PART 1 Preliminary 2.1 Clause 1 Clause 1 cites the short title and the construction ofthe Bill. Except for the change in the date of the Act from 2008 to 2010 and the correction to the spelling of the word "Gazette" to read "Gazette", your Committee has decided that no other change was necessary. 2.2 Clause 2 Clause 2 speaks to the interpretation ofthe definitions that are ofparticular interest in the Bill. Your Committee deliberated extensively on the definition of the "authorized officer" who is a creature of the statute and would be conferred certain powers of enforcement. Your Committee decided that in the definition of "authorized officer" all the words appearing after (c) in the definition should be deleted and therefore the comma would be replaced by a full-stop after the words "Commissioner of Police". In discussing the definition of "competent authority", concerns were raised about the fact that there might be overlapping powers or jurisdictions given to the Minister of National Security who has portfolio responsibility ofthe Proceeds of Crime Act and the Minister of Finance and the Public Service who has the portfolio responsibility of the Financial Investigations Division. The matter of who really had the power and who acted ultra vires if one Minister did something that should have been the duty of the other Minister was also discussed. It was decided that the concerns could be addressed administratively and would necessitate collaboration,' consultation and cooperation between the Ministry of Finance and the Public Service and the Ministry of National Security. Your Committee also expressed concerns about whether or not there should be a listing of every entity that could be designated a "competent authority". It was decided that the Minister would have the power to designate a "competent authority" and therefore there was no need to do a listing. In the definition of "Chief Technical Director", the numeral "7" was deleted and substituted with the numeral "8". Your Committee accepts the change. 4 In the definition of "Division", your Committee accepts that it is necessary to delete the numeral "3" and substitute therefor the numeral "4". In the definition of "public body", your Committee decided that the word "person" in paragraph (c), should be deleted and replaced with the word "entity". This decision was taken to make it clear that the definition was not to include natural persons. It was felt that it would be useful to have an "objects"clause in the Bill which would set the framework for the legislation by defining the objects of the legislation. Your Committee accepts the decision to insert a new clause which would be numbered as 3. Clause 3 would have as its marginal note, "Object of Act" and would state as follows: "The object of the Act is to establish a department of Government with sufficient independence and authority to effectively deal with the multi-dimensional and complex problem of financial crime and confer upon it the responsibility to (a) investigate all categories offinancial crimes; (b) collect information and maintain intelligence databases on financial crimes; (c) maintain an arm's length relationship with law enforcement agencies and other authorities of Jamaica and of foreign States, and with regional and international associations or organizations, with which it is required to share information; and (d) exercise its functions with due regard for the rights of citizens.". PART II Financial Investigations Division 2.3 Clause 3 This clause establishes the Financial Investigations Division as a department of Government. (This clause will be renumbered as clause 4) . Your Committee accepts this clause. 2.4 Clause 4 This clause lists the functions of the Division. (This clause will be renumbered as clause 5) Your Committee accepts that it is necessary to delete from paragraph (c) the numeral "9" and substitute therefor the numeral "10". 5 Your Committee also accepts that clause 4 (1) (d) should be deleted and substituted therefor with the following: "(d) where the Chief Technical Director considers it necessary, to disseminate information and reports referred to in paragraph (b) to (i) the competent authority; (ii) the Attorney General, the Commissioner of Police, any of the Revenue