Financial Crime World

Mauritius Takes Tougher Stance on Financial Crime: New Commission and Laws

The Mauritian parliament passed the Financial Crime Commission Act 2023 (Act) in late December 2023 with the aim of becoming a global leader in combating financial crimes and the financing of drug dealing. Here’s what the new legislation means:

Establishment of the Financial Crime Commission

  • Addressing long-standing issues: The Act aims to address issues of accountability, insufficient case management oversight, and cooperation among different agencies by establishing the Financial Crime Commission (Commission) as the Mauritian umbrella agency.
  • Responsibilities of the Commission: The Commission is responsible for detecting, investigating, and prosecuting financial crimes and drug dealing financing. It includes a director-general, four commissioners with limited tenures, an Investigation Division, an Asset Recovery and Management Division, an Educative and Preventive Division, and a Legal Division.

Repealing and Consolidating Laws

  • Centralizing functions and powers: The Act repeals the Prevention against Corruption Act (POCA) 2002, the Assets Recovery Act (ARA) 2011, and parts of the Financial Intelligence and Anti-Money Laundering Act (FIAMLA). This consolidation of functions and powers enables the centralization of all functions and powers previously held by various agencies under the Commission.
  • New framework for financial crimes: The Act groups different financial offenses, such as corruption, money laundering, fraud, and drug dealing financing, under the unifying concept of “financial crime.”

New Financial Crime Offenses and Liabilities

  • Fraud offenses: The Act introduces new financial crimes, including fraud offenses targeting sophisticated schemes.
  • Financing drug dealing offenses: The Act criminalizes financing drug dealing offenses.
  • Liability of legal persons: Legal persons, including private entities like companies, now face liability for financial crimes committed by their directors, managers, or representatives. Legal persons must implement adequate procedures to prevent financial crimes and face a fine of MUR 20 million if they fail.

Corruption in Private Entities

  • Corruption within private entities: The legislature makes it clear that corruption within private entities is an offense, targeting bribery by or of any employee or member.
  • Framework for asset recovery: The repealed ARA 2011 now provides a new framework for recovering and confiscating proceeds, instruments of offenses, or terrorist properties, using both a criminal-based and civil-based asset recovery regime.

Awaiting Effective Implementation

  • Consolidation of powers: Although the creation of the Financial Crime Commission is welcomed, it remains to be seen whether the consolidation of powers will enable an effective fight against financial crimes.
  • Impact on Mauritian law and the business landscape: Looking forward, the Supreme Court will interpret the new Act’s provisions, and law practitioners will study its details, determining its impact on Mauritian law and the business landscape.