May.03, 2010, 2:05 PM EDT

Finance authorities in Guyana have given commercial banks an extra three months to verify the identity and current address of every single customer in a new move to tighten up money laundering loopholes existing in the national banking system.

In recent weeks banks had sent out letters to customers threatening to close accounts if depositors had not come forward with utility bills and other proof of addresses and identities, triggering panic especially among depositors based in North America and the U.K. who were caught off guard by the threat to close accounts.

Some, elderly Guyanese in particular, had even flown home to address the issue, complaining of the costs of air tickets and other expenses.

Sunday, May 9 was the original deadline but Finance Minister Ashni Singh has now fixed mid August as the new date for depositors to comply, GINA, the government information agency said as the work week began, adding that the exercise will give banks a chance to properly update data bases.

The Bharrat Jagdeo administration has been repeatedly criticized by opposition parties and the U.S. State Department for not doing enough to fight the narco trafficking and money laundering trades in the past, but Singh said the new move will make it easier for banks to detect suspicious transactions and to trace depositors.

The new requirements follow recent amendments to legislation on money-laundering and financing of terrorism acts that Guyana and other Caribbean Communitycountries have been addressing in recent months.