Senate
15th December, 2008

THE FINANCIAL SERVICES SECTOR IS THE LATEST VICTIM OF THE STOP REVIEW AND CANCEL POLICY.

THE FNM STOP REVIEWED AND CANCELLED THE MINISTRY OF FINANCIAL SERVICES AND INVESTMENTS…THE SECTOR WANTED A VOICE AT THE CABINET TABLE, AS THE VOICE OF TOURISM IS AT THE TABLE…THIS IS THE SECOND PILLAR OF OUR ECONOMY…IT OUGHT NOT TO BE A “DEPARTMENT” IT SHOULD BE A MINISTRY…SO THAT ITS FULL POTENTIAL CAN BE REALIZED.

THE FNM STOP REVIEWED AND CANCELLED ALL OF THE WORK THAT WAS DONE TOWARDS AN FATF, STREAMLINED, EFFICIENT AND COMPETENT REGULATORY REGIME.

ESPECIALLY GIVEN THE FINANCIAL CRISES ALL OVER THE WORLD (AND STILL EMERGING) DUE TO INCOMPETENT AND LAX REGULATION, BAHAMIANS MUST BE TOLD ABOUT THE RESULTS OF ANY AND ALL WORK OF THE COMMITTEE ON THE STREAMLINED REGULATORY REGIME.

FNM  GOT US ON THE BLACKLIST

FNM killed financial services – many Bahamians involved in the industry then STILL have not recovered from that blow

HERE WE GO AGAIN, is the feeling

In December 2003 I presented the amendment to the FTRA for the risk based approach. I said then and repeat now:
“I wish to again quote Baroness Kennedy and remind this House that “rushing to legislation is rarely successful.  There is no such thing as temporary legislation; it is never temporary.”  Legislative reforms and amendments are best dealt with in a thoughtful and reflective climate after effective consultation and research.  The process is most successful when it is not captive to inflexible time constraints which almost inevitably diminish the quality of the work product.”

PLP with openness and transparency got us off the WATCH LIST that the FNM left us on

We do NEED to respond to Mutual Evaluation (MEVAL)

SHOULD NOT HAVE piecemeal approach

Should have wide consultation about:
VISION
FUTURE of, especially given declared intention of US to close Offshore Centres
MEVAL
What needs to be done to meet the FATF 40 + 9
THEN – agree the way forward

PIECEMEAL APPROACH WITHOUT A VISION IN MIND, WITHOUT BUY IN, IS A RECIPE FOR DISASTER

WHAT IS THE VISION for FS

MFSI – 1st ever 5 year Strategic Plan
Was consulting over 2nd 5 year plan
2nd 5 year Strategic Plan Involved mainly:
 Branding
 Relations with international agencies
 Use of Treaties to promote FS and Investment

Criticism for getting rid of MFServices
On investment side MFSI had:
Regular meetings with ALL stakeholders
Unparalleled coop with contractors assoc, engineers, architects, real estate brokers
They needed to now AHEAD of time of investments and how to benefit
We had broken the mold of non Bahamian professionals ALWAYS at the table
Approved Investments were on the web – visual and written
Investments being negotiated we discussed at Regular meetings

Financial Services Consultative Forum (Forum) disbanded by the FNM
Talk about the Forum and why it was/is important
Branding survey:
What action taken on it
At BFSB Retreat presented the GDP the result of FS, amazing and the growth potential is HUGE
CLEAR AS A BELL THAT A VISION IS NEEDED for financial services
Mutual evaluation
Lack of timely response to international requests
Destruction of sector due to knee jerk reactions
Forum advice:= FTRA
Talk about what happened last time with prescription v risk based
 Risk based assessment
 $15K
 Grandfathering
Proper funding of each regulator
Suitable people to serve in the regulatory agency
Proper consultation
 Wide ranging changes
 Tightens significantly regulatory regime
Have been advised that FINANCIAL INSTITUTIONS such as
 Bar association not consulted = lawyers
 BICA not consulted =accountants
 BREA not consulted = real estate agents
Traditional financial institutions and  regulators need to meet with the private sector, no bottlenecks – no need to consult 5+ regulators good BUT what about the regulators understanding “risk based”

Bahamian owners of banks and trust companies
 Is the central bank Bahamian friendly
 Are Regulators “Bahamian friendly”…
People say that many are shackled by colonialism, can’t imagine nor deal with Bahamians owning banks and trust companies, especially in the offshore sector.
Without VISION the people perish
What is the VISION for Financial Services
Where does it fit into our National Development Plan
All legislation should be brought forward in that National Vision prism
Shame on the FNM for not having a vision for Financial Servcies
Shame on FNM for not promoting and developing the second pillar of our economy
Shame on the FNM for its piecemeal approach to reform and development.