Mr. President, members of Rotary, distinguished ladies and gentlemen:

I propose to address you this afternoon on the "Blacklisting Crisis". It is, as you well know, a crisis that has gripped our financial services industry for the better part of a year now; a crisis that has already inflicted heavy losses upon us as a nation both materially and psychologically; and a crisis whose ill-effects will continue to plague us for a long time to come whether or not we are removed from the FATF "blacklist" when that body assembles come the third week in June.

Not since the attainment of Independence in 1973 have we felt so vulnerable to external pressures; so susceptible to the manipulations of other nations; so dictated to by the great powers of the world; and so powerless to control our own destiny as a sovereign nation.

The whole blacklisting experience has left Bahamians and our friends around the world feeling very sad, very angry and, to be perfectly candid, very let down by the captains of our ship of state.

We do not expect our leaders to be miracle-workers but we do expect that in holding the reins of power, our national leaders will so conduct the affairs of state as to preserve our pride and our dignity as a nation and that they will safeguard our economic interests, as best they can, against external aggressors.

Yes, we are a small nation but we are also a proud people. We lay claim to a proud tradition of making our own way in the world without being told by others what we should do; without being bamboozled by others into believing that they know better than we do what is best for us; and without being threatened and cajoled, or seduced and fooled into doing things we ought to know are contrary to our own best interests as a free and independent people long accustomed to prosperity honestly earned.

Recent events, I am sad to say, have savagely undermined that proud tradition.

Never before in our entire history have we had to swallow whole a legislative agenda as great as the one we were made to swallow in December of last year when the Prime Minister of the sovereign Commonwealth of The Bahamas came before Parliament and presented nearly a dozen new pieces of legislation; legislation that had been designed and cobbled together not by the Prime Minister; not by his cabinet; not by his Bahamian advisers; not by the Bahamian financial services industry; not by Bahamians at all, but rather by armies of anonymous bureaucrats drawn from the alphabet-soup of the FATF, the FSF, the OECD and others, including the U.S. Treasury Department.

I know how difficult it must have been for Mr. Ingraham to resist taking the medicine that had been prescribed for him. And I have no doubt that he thought he was doing the right thing, perhaps even the only thing he could do with the guns of the FATF/FSF cocked and loaded and pointing at the belly of our financial services industry, just itching to blow it all away.

Thus, I do not accuse Mr. Ingraham of insincerity. I think he honestly did what he thought was best under the circumstances.

Mr. Ingraham has had to learn the hard way. He has had to learn that in the corridors of power, whether in Washington or in London or in Bonn or in Paris, personalities count for nothing and personalities from the Third World count for less than nothing when it comes to dealings between nations in the hard currency of power. It is not about personalities and never has been. It is all about agendas and stratagems by the bullying powers of the world to grab a bigger share of the planet’s wealth. If you have it, they want it, and they will do whatever it takes to get it.

By some estimates, there is something on the magnitude of 10-15 Trillion dollars percolating in the offshore world. That is more than pocket change to the great powers and they feel that it belongs to them anyway because most of it represents, in their view, "diverted wealth", that is to say, money that is owed to them in taxes but has been diverted to offshore centers rather than being paid into onshore national treasuries.

Moneylaundering is the smokescreen. The name of the game is taxes.

That is the true agenda.

In pressing that agenda against the offshore jurisdictions, the sovereignty of small nations is no deterrent to the big onshore powers once they have decided to slit your economic throat. Who happens to be the leader of the targeted nation simply does not compute. The great powers couldn’t care less who you are or what your name is.

If Mr. Ingraham didn’t know that before, you can rest assured he knows it now.

But he and his Government should have known it a long time ago.

The truth of the matter is that the threat of blacklisting didn’t suddenly materialize last year. From as far back as 1992 – not long after the FNM first took office - there were ominous signs on the horizon that unless structural reforms to our banking system were introduced, punitive sanctions in one form or another from one quarter or another would likely hit The Bahamas.

Despite those early warning signs, despite any number of subsequent warnings over the ensuing eight years, despite every indication that evasive action was required to avoid collision, Mr. Ingraham and Mr. Allen did nothing. They did not enter into negotiations with anybody with a view to deflecting the threat; they did nothing to enlist the support of Caricom or the IMF or the World Bank or the United Nations to deal with the growing threat; they did nothing in the way of sustained public relations to disabuse our foreign detractors of the false perceptions and erroneous assumptions they had made about The Bahamas; they did nothing in the way of local consultation with industry professionals as what pre-emptive changes might be introduced to anticipate the demands of the outside forces; and they did absolutely nothing to enlighten the Bahamian people as to what was likely to happen if legislative and regulatory reforms were not introduced in a timely manner.

It was a case of Nero fiddling while Rome was burning. Worse than Nero, though, the Ingraham Government sat on their hands, closed their eyes, plugged up their ears and fell asleep at the wheel.

For eight years, the Ingraham Administration did nothing and then when the blacklisting became a reality last year, suddenly everything went into overdrive and overkill.

Unlike other jurisdictions which had simply committed by letter to introduce reforms to their banking and regulatory laws, the Ingraham Government did not play for time when it was time to play for time. Instead, he jumped straight ahead and introduced the legislative and regulatory reforms all in one fell swoop in December – ironically at the same time the Bush Administration was coming into office with a change of attitude and a change of policy.

Clearly, there was insufficient consultation at the local level on the new laws. Very few industry professionals and even fewer lawyers were consulted. We in Parliament even were given hardly any time at all to digest the proposed new laws. In some instances, no more than a few days advance notice was given in relation to major amendments. Everything was rush-rush-rush.

Further, we were all led to believe that the new financial legislation had been benchmarked according to similar legislative initiatives in competing jurisdictions. The Prime Minister assured the industry and assured the nation that the new legislation would not put us at a competitive disadvantage.

Nothing, however, could then - or now - have been further from the truth.

The truth is that The Bahamas, by its new laws, has gone a great deal further than anyone else as a result of the Ingraham Government’s anxiety to appease the Financial Action Task Force (FATF) and the other foreign aggressors.

We have enacted legal restrictions and regulatory controls that are nowhere else to be found with such severity - not in any other offshore jurisdiction and most certainly not in the United States, Canada, the United Kingdom, France or Germany.

The bottom line is this: the new legislation, especially the Financial Transactions Reporting Act, now makes it considerably more difficult to carry on legitimate, I repeat, legitimate banking business in The Bahamas than in any other jurisdiction in the offshore world.

Bankers, trust companies, mutual fund administrators, corporate service providers, money-managers, investment advisers and ordinary bank customers will all tell you that in the short space of five months The Bahamas has been transformed into the most difficult place in the world to open a bank account or to engage in any other type of legitimate financial services activity.

Our banking system has become over-regulated. It is now in danger of asphyxiation from red tape and overly intrusive oversight. Operating costs for financial institutions have skyrocketed as a result of the new compliance requirements: compliance personnel have had to be increased; operating systems and computer software have had to be re-designed; and rather than attending to the legitimate banking needs of their customers, bankers are now obliged to use more and more of their time interrogating their customers. Bankers are no longer just bankers. The new financial services legislation has turned them into policemen who have to spend more time policing and patrolling and investigating than attending to the business of banking for which they were trained.

But it doesn’t stop there.

What was ostensibly intended as a package of measures to curb money-laundering and bring greater ethical discipline to banking and financial practices has instead turned into a hellish nightmare in which honest, hardworking, law-abiding citizens are made to feel like common criminals when they go into the bank they have done business with all their lives.

And it doesn’t stop there either.

The IBC Act, once the "jewel in the crown" of a booming the financial services industry, has now become a harbinger of doom. The IBC business is dying out, evaporating, disappearing. The Government expects to lose $20,000,000 in revenue and that loss can be multiplied several times over in the private sector. And where do you think the IBC business is going – to British colonies like the BVI and Anguilla. Now, isn’t that something? The United Kingdom, one of the major supporters of the FATF and OECD initiatives, is allowing its own colonies to capitalize on our losses.

And it doesn’t stop there.

The Government has announced that it will soon enter into a Tax Information Exchange Agreement with the United States. Even more troubling, if recent press reports are to be believed, the Prime Minister has now opened the door to the possibility of other Tax Information Exchange Agreements with other countries as well.

And it doesn’t stop there. We have created a Financial Intelligence Unit under an Act of the same name and given it powers to freeze bank accounts on the basis of suspicion. What has happened to our confidence in the judicial process? What has happened to our faith in our national constitution? Only judges should be able to freeze people’s property, not policemen.

Where will it all end? When will this incremental dismantling of our nation’s second economic pillar be arrested?

The answer is, very soon.

It will not, however, happen on Mr. Ingraham’s watch. It will happen on mine. And my watch will begin before the current year is out, whenever Mr. Ingraham calls the General Election he is destined to lose.

When I assume office as Prime Minister, I can assure you of the following:

Blacklist or not, we have much work ahead of us but I am convinced that with a change in Government to the PLP and with a commitment to the objectives I have just enunciated, we can put it right and emerge from this unhappy period of our national existence on a sure and certain footing for the future.

I thank you for inviting me to address you today and for your patient attention.