Chester Sam­bra­no &

Geisha Kow­lessar-Alon­zo

The Cen­tral Bank of Trinidad and To­ba­go has clar­i­fied that au­tho­rised fi­nan­cial in­sti­tu­tions are legal­ly per­mit­ted to ex­port US cur­ren­cy un­der ex­ist­ing laws, as in­ves­ti­ga­tions con­tin­ue in­to the seizure of US$2 mil­lion in cash linked to NCB Mer­chant Bank at Pi­ar­co In­ter­na­tion­al Air­port.

In a me­dia re­lease yes­ter­day, the Cen­tral Bank said it was re­spond­ing to pub­lic ques­tions aris­ing from me­dia re­ports about the in­ves­ti­ga­tion, par­tic­u­lar­ly against the back­drop of on­go­ing for­eign ex­change short­ages and con­cerns over the move­ment of US cur­ren­cy out of the coun­try.

The US$2 mil­lion was seized by Cus­toms and Ex­cise of­fi­cials on June 25 at the South Ter­mi­nal of Pi­ar­co In­ter­na­tion­al Air­port. The cash, which was linked to NCB Mer­chant Bank, was be­ing trans­port­ed to Mi­a­mi via Ja­maica when of­fi­cials in­ter­vened over doc­u­men­ta­tion and ac­count­abil­i­ty re­quire­ments.

NCB Mer­chant Bank has main­tained that the mon­ey be­longs to the bank and formed part of a le­git­i­mate trans­ac­tion con­duct­ed in the or­di­nary course of busi­ness with an­oth­er reg­u­lat­ed fi­nan­cial in­sti­tu­tion.

The Cen­tral Bank said that, un­der the Ex­change Con­trol Act, au­tho­rised deal­ers, in­clud­ing banks and non-bank fi­nan­cial in­sti­tu­tions li­censed un­der the Fi­nan­cial In­sti­tu­tions Act, 2008, may legal­ly ex­port notes that are, or have been, le­gal ten­der in Trinidad and To­ba­go or any oth­er coun­try.

It ex­plained that im­ports and ex­ports of cur­ren­cy oc­cur among au­tho­rised deal­ers as part of their nor­mal op­er­a­tions.

Ad­dress­ing ques­tions about the ex­port of US cash, the Bank said that where a ship­ment is ac­com­pa­nied by “a com­pen­sat­ing cred­it in an equiv­a­lent amount” wired back to T&T and sold in the lo­cal mar­ket, “there is no net ex­port of the cur­ren­cy.”

The Bank stressed that its clar­i­fi­ca­tion did not re­late to the mat­ters un­der in­ves­ti­ga­tion and said it would not com­ment fur­ther at this stage to avoid com­pro­mis­ing the work of in­ves­tiga­tive agen­cies.

The clar­i­fi­ca­tion comes af­ter for­mer bankers Ronald Har­ford and Robert Le Hunte de­scribed the im­por­ta­tion and ex­por­ta­tion of US cur­ren­cy by com­mer­cial banks as a rou­tine part of in­ter­na­tion­al bank­ing op­er­a­tions.

Har­ford said com­mer­cial banks reg­u­lar­ly im­port new US ban­knotes while ship­ping old­er notes back to the Unit­ed States for pro­cess­ing and de­struc­tion. He al­so said the move­ment of large sums of US cur­ren­cy is not un­usu­al giv­en do­mes­tic de­mand.

Le Hunte sim­i­lar­ly said banks must ac­tive­ly man­age their US dol­lar cash hold­ings to meet cus­tomer de­mand and that ship­ment sizes vary de­pend­ing on op­er­a­tional needs, trea­sury poli­cies, se­cu­ri­ty con­sid­er­a­tions, ship­ping costs and cor­re­spon­dent bank­ing arrange­ments. He cau­tioned that the amount in­volved in any ship­ment, by it­self, should not be in­ter­pret­ed as ev­i­dence of wrong­do­ing.

Turn­ing to the wider for­eign ex­change sit­u­a­tion, the Cen­tral Bank said it had main­tained sta­bil­i­ty in the coun­try’s of­fi­cial for­eign ex­change re­serves over the past year de­spite in­ject­ing US$1.2 bil­lion in­to the mar­ket to sup­port the trad­ing books of au­tho­rised deal­ers.

It al­so pro­vid­ed an ad­di­tion­al US$900 mil­lion to state en­ter­pris­es and the Ex­im Bank to sup­port small and medi­um-sized man­u­fac­tur­ers and es­sen­tial im­ports.

Ac­cord­ing to the Bank, the coun­try’s for­eign ex­change re­serves re­mained equiv­a­lent to six months of im­port cov­er at the end of June 2026.

The Bank ac­knowl­edged that the man­age­ment of the for­eign ex­change sys­tem re­quires strength­en­ing and said sev­er­al ini­tia­tives will be in­tro­duced in the com­ing months, in­clud­ing amend­ments to the Ex­change Con­trol Act.

Gov­er­nor Lar­ry Howai said pro­posed changes are nec­es­sary to ad­dress the coun­try’s for­eign ex­change chal­lenges in the short to medi­um term.