Financial Crime World

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Compliance Risks in Finance: Mauritius’ Anti-Money Laundering and Combating the Financing of Terrorism (AML/CTF) Supervisor Warns of Dangers of Non-Compliance

The Financial Intelligence Unit (FIU), Mauritius’ AML/CTF supervisor, has sounded a warning to financial institutions and other businesses operating in the country that non-compliance with anti-money laundering and combating the financing of terrorism regulations can have severe consequences.

Key Requirements for Reporting Entities

Under the Financial Intelligence and Anti-Money Laundering Act of 2002, Reporting Entities are required to:

  • Conduct customer due diligence before and during business relationships or transactions
  • Identify beneficial owners and domestic and foreign politically exposed persons (PEPs)
  • Keep accurate records of all transactions
  • Identify money laundering and terrorist financing risks associated with their products and services and implement appropriate mitigations

Regulatory Reports and Registration

Reporting Entities must also:

  • Submit regulatory reports to the FIU
  • Register with the FIU
  • Failure to comply with these regulations can result in severe penalties, including fines and even criminal prosecution.

Simplified Customer Due Diligence (SDD)

The FIU has clarified that SDD may be applied if lower risks have been identified by the Reporting Person and are consistent with the findings of the national risk assessment of the relevant supervisory authority or regulatory body.

Reporting Obligations

Reporting Entities must:

  • Submit Suspicious Transaction Reports (STRs) to the FIU within 5 working days of becoming aware of suspicious transactions
  • Report cash transactions over Rs 500,000 as suspicious and are not allowed under any circumstances.

Consequences of Non-Compliance

The FIU has warned that non-compliance with these regulations can have severe consequences, including:

  • Reputational damage
  • Financial losses
  • Criminal prosecution

It is therefore essential for Reporting Entities to ensure that they comply fully with these regulations to avoid any potential risks.