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Compliance Procedures for Banks in Mauritius: An Assessment

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Despite the existence of anti-money laundering (AML) laws, money laundering malpractices continue to plague the world. According to the United Nations, the value of money laundering globally ranges between 2 and 5% of the world’s GDP annually. As a result, it is crucial for formal institutions like banks to implement AML procedures to verify whether their clients are involved in money laundering criminal activities.

This study aims to assess compliance by banks with AML laws in Mauritius and internationally agreed-upon standards. To achieve this objective, both qualitative and quantitative research methods will be adopted.

Methodology

The study employed a mixed-methods approach, combining both qualitative and quantitative research methods. A survey was administered to 57 executive officers representing 19 licensed banks in Mauritius. Additionally, a review of existing legal provisions and literature on AML procedural requirements was conducted using a black letter research method.

Results

The findings of the study indicate that while most banks in Mauritius have implemented AML procedures, there are still gaps and weaknesses in these systems. The survey results show that many respondents reported difficulties in identifying and reporting suspicious transactions, as well as a lack of adequate training for employees on AML procedures.

Conclusion

The study highlights the need for further improvement in AML procedures implemented by banks in Mauritius. The findings suggest that strengthening the country’s anti-money laundering framework requires addressing gaps and weaknesses in existing systems, including improving employee training and enhancing reporting mechanisms.

Recommendations

Based on the study’s findings, it is recommended that the Financial Services Commission of Mauritius (FSC) and the Bank of Mauritius take steps to strengthen AML procedures implemented by banks in the country. This may include providing additional training for employees on AML procedures, improving reporting mechanisms, and enhancing supervision and monitoring of banks’ compliance with AML regulations.

Future Research Directions

This study provides a foundation for future research on AML procedures in Mauritius. Future studies could investigate specific aspects of AML procedures, such as the effectiveness of employee training programs or the impact of regulatory enforcement on bank behavior. Additionally, comparative studies could be conducted to examine AML procedures implemented by banks in other countries and how they compare to those in Mauritius.

References

A comprehensive list of references cited in this study is available at the end of this article.