Dozens of candidates from the party of US-sanctioned Azruddin Mohamed’s political party have had their accounts closed by Citizens Bank, and other banks are expected to follow.
Demerara Bank was the first to cancel the accounts of candidates from Azruddin’s WIN party, and then GBTI followed.
Other banks are expected to take similar action given that they are all part of GABI, the Guyana Association of Bankers, which recently clarified that all licensed commercial banks in Guyana are guided by strict regulatory obligations, critical to the preservation of the financial system’s integrity.
The Guyana Association of Bankers is dedicated to improving banking practices and providing constructive representation, advocacy, and counsel for the financial sector.
Its members are Scotia Bank, Republic Bank, the New Building Society (NBS), the Bank of Baroda, Demerara Bank, GBTI, Citizens Bank, among others.
‘Banks guided by strict regulatory obligations’ – GABI
The Association had said banks are guided by strict regulatory obligations, including Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) requirements, as well as global risk management practices. It said these standards are critical to preserving financial system integrity, protecting depositors, and ensuring continued access to international financial markets.
Banks have been compelled to review their compliance measures in line with international banking regulations, particularly those mandated by Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) laws, which are designed to prevent the use of illicit funds.
When the Mohameds were sanctioned, all local banks closed their accounts, including that of Mae Thomas , the Permanent Secretary in the Ministry of Home Affairs and her family members, she was also sanctioned.
Individuals closely associated with sanctioned persons or entities may expose financial institutions to serious legal and financial risks. As such, banks are taking steps to protect themselves.
This caution stems from the need to safeguard their correspondent banking relationships. A correspondent bank is a foreign bank that helps a local bank conduct international transactions and business.
Instead of establishing branches overseas, local banks work with correspondent banks to send money abroad, facilitate international card payments, and handle accounts and documentation related to cross-border transactions.
Given this, local banks are exercising heightened caution in avoiding transactions with individuals directly linked to Azruddin Mohamed, as such associations could jeopardise their operations.
On 11 June 2024, the Office of Foreign Assets Control (OFAC) of the US Department of the Treasury announced the imposition of sanctions against the Mohamed family—specifically targeting Nazar Mohamed, his son Azruddin Mohamed, and their businesses: Mohamed’s Enterprise, Hadi’s World, and Team Mohamed’s Racing. These sanctions were related to alleged gold smuggling and corruption.
As a result of the OFAC sanctions, the Mohameds’ business licences were revoked, and their bank accounts were closed.
Azruddin has accused the government of political persecution; however, the actions taken against his party’s candidates are being carried out by banks seeking to protect their institutional interests.
When an individual is sanctioned by OFAC, local banks face severe operational and legal consequences.
They are required to immediately block any assets or property belonging to the sanctioned individual under their control, and must also prevent any transactions involving that person or entity.
This entails freezing accounts, stopping transfers, and terminating all dealings with the sanctioned party.
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