The chief executive of Papua New Guinea's largest bank, Bank South Pacific, says new laws to combat fraud are unworkable and could strangle economic development in the country.
Ian Clyne says the new regulations which require an additional series of bureaucratic hurdles to be cleared on government transactions place too great a demand on commercial banks which will end up carrying a long term liability.
He says when large amounts of money are involved the banks are basically assuming the role of the auditor general.
Mr Clyne says the scheme, that's been developed by AusAID in conjunction with the Australian Federal Police, wouldn't be accepted anywhere else in the world.
"It's not a question of governance. As I said banks are payment facilitators. We already have special processes to ring the highest levels of government to validate every cheque, to validate every signature, and so this is basically regulations that are very unique to PNG and have been defined to address a problem without any consideration to the consequences."
