Financial Crime World

Mauritius Strengthens AML Regulations: KYC Processes and Identity Verification for Individuals and Corporates

Mauritius, known for being a financial hub in the Indian Ocean, has strict regulations in place to prevent money laundering and terrorist financing activities. Here’s a closer look at the Mauritian KYC procedures and the relevant legislations.

KYC Process for Individuals

To open an account in Mauritius, individuals need to go through a thorough Know Your Customer (KYC) process. The required documentation includes:

  • Permanent address
  • Recent photograph
  • A valid national ID card or passport

This information helps Mauritian financial institutions comply with the country’s anti-money laundering (AML) regulations. In Mauritius, Mauritian National Identification Cards are used for this purpose, which contain essential details such as the cardholder’s name, national ID number, and a photograph. Mauritius also has eSignature laws, and the Electronic Transactions Act 2000 grants legal validity to digitally signed documents.

KYC Process for International Customers

When onboarding international customers, the KYC process in Mauritius is similar. Apart from address and photograph verification, corporations require the following identification:

  • Business identification
  • Nature
  • Financial status
  • Capacity in which the individual is entering the business relationship

Mauritian AML Regulations and Legislation

Mauritius enacted significant AML laws and regulations in 2002, including:

  1. The Financial Intelligence and Anti Money Laundering Act 2002 (FIAMLA)
  2. The Prevention of Corruption Act 2002 (POCA)

The Bank of Mauritius (BOM) regulates AML controls for banking institutions, while other financial services fall under the jurisdiction of the Financial Services Commission (FSC).

Requirements for UBOs and Enhanced Due Diligence

Financial institutions in Mauritius must identify and verify Ultimate Beneficial Owners (UBOs) who own 20% or more of the capital or voting rights of a company. Enhanced due diligence measures must be taken for high-risk business relationships, including:

  • Politically exposed persons
  • Foreign correspondent banking relationships

Financial institutions are expected to gather extensive information about their counterparts abroad and establish effective controls against money laundering and terrorist financing.

Additional Due Diligence for Non-face-to-face Transactions

Additional due diligence measures are crucial for non-face-to-face transactions and relationships to mitigate the high risks associated with remote business activities. In case of suspicious transactions, financial institutions in Mauritius are required to file Suspicious Activity Reports (SARs) with the Financial Intelligence Unit (FIU). Penalties for failure to comply with these reporting requirements can include fines and imprisonment.

Data Protection Regulations

To ensure strong data protection, the Data Protection Act 2004 governs the collection, processing, and transfer of personal data in Mauritius. This regulation sets out guidelines for protecting personal information and sensitive data, imposing strict restrictions on the transfer of credit reports, and requiring Express Consent from data subjects or the necessity of data processing for specific purposes.

Conclusion

Mauritius has a comprehensive regulatory framework aimed at combating money laundering and terrorist financing. Both individuals and legal entities must comply with rigorous KYC processes to verify identity and business information, ensuring a safe and transparent financial environment in the region.