Mauritius has been a safe haven for investors and entrepreneurs wishing to establish a business for some time already. It is a secure fintech hub that has been attracting firms because of the several benefits it offers. One of those is the fact that it is a secure jurisdiction that can be trusted. In fact, there are several measures being implemented to ensure its reliability.
Mauritius is working with the Financial Action Task Force
The Financial Action Task Force (FATF) has issued a list of ‘jurisdictions under increased monitoring’. This is commonly known as ‘the grey list’ and for the first time, it included Mauritius alongside 17 other jurisdictions. These are actively working in collaboration with the FATF to find solutions and address strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing. While the FATF does not call for the application of enhanced due diligence to be applied to these jurisdictions, Mauritius’s Minister of Financial Services & Good Governance has announced that the island is introducing the necessary measures.
The Minister advanced that Mauritius is making considerable progress in the implementation of a number of recommended actions as set out by the Financial Action Task Force (FATF). These will improve technical compliance and effectiveness. At the time of writing, it remains largely compliant by adhering to 35 of the FATF’s 40 recommendations. The technical team of Mauritius has been working to scale up efforts to improve the island’s position. In 2018, an assessment was conducted which revealed that it adheres to only 14 recommendations. Now, this number has increased to 35, which demonstrates an unflinching commitment and undeniable progress.
How will the island implement its action plan?
The Minister of Financial Services & Good Governance has revealed that it is going to implement its action plan by:
- Demonstrating that the supervisors of its global business sector and Designated Non-Financial Business & Professions had implemented risk-based supervision,
- Ensuring access to accurate basic and beneficial ownership information by competent authorities in a timely manner,
- Demonstrating that law enforcement agencies had the capacity to conduct money laundering investigations, including parallel financial investigations and complex cases,
- Implementing a risk-based approach for the supervision of the Non-Profit Organisation sector to prevent abuse for terrorist financing purposes and
- Demonstrating the adequate implementation of targeted financial sanctions through outreach and supervision.
Measures already being implemented
The Mauritian Financial Services Commission (FSC) issued its first ‘Anti-Money Laundering and Countering the Financing of Terrorism Handbook’ in January this year. This is designed to assist licensed financial institutions to adopt a ‘more effective, risk-based and outcome-focused approach’
This Handbook offers financial institutions guidance on applying national measures to combat money laundering and terrorist financing and on complying with the requirements of the Financial Intelligence & Anti-Money Laundering Act, 2002 (FIAMLA) and Financial Intelligence & Anti-Money Laundering (FIAML) Regulations 2018. Moreover, it covers the risk-based approach, customer due diligence, ongoing monitoring, reporting of suspicious transactions, record-keeping and employee training. These will be useful to financial firms when they assess the adequacy of their internal systems and controls and resolve any identified inadequacies. Moreover, the FSC will take the Handbook into account when assessing levels of compliance during onsite visits.