The financial fallout from US sanctions against Guyanese businessman Azruddin Mohamed is spreading through the country’s banking sector, with Citizens Bank joining two other lenders in closing accounts linked to his political party.
The move follows similar actions by Demerara Bank and the Guyana Bank for Trade and Industry (GBTI), reflecting growing caution among local banks amid rising international compliance pressures.
The closures come in response to sanctions imposed by the US Treasury’s Office of Foreign Assets Control (OFAC) on Mohamed and his father Nazar Mohamed over alleged gold smuggling, tax evasion and corruption. Former Permanent Secretary of the Ministry of Homes Affairs Mae Thomas was also sanctioned, and her accounts were subsequently closed.
Banks in Guyana face strict obligations under anti-money laundering and countering the financing of terrorism (AML/CFT) laws. Financial institutions are under pressure to maintain ties with foreign correspondent banks, which facilitate international transactions such as wire transfers, card payments and cross-border trade.
These are not isolated incidents, a financial analyst said, pointing out that failure to comply with OFAC rules could result in severe penalties, including loss of access to the global financial system.
Under OFAC regulations, banks are required to freeze assets and halt transactions involving sanctioned individuals. Non-compliance can lead to reputational damage and regulatory blacklisting.
Azruddin Mohamed has dismissed the sanctions as politically motivated. Local banks, however, appear to be acting to shield themselves from international fallout.
