Mauritius to tighten financial fraud surveillance

The logo of the World Bank at the entrance to the building in Washington, DC. The bank has consistently rated Mauritius as the best business friendly country in Africa. FILE | AFRICA REVIEW 

Mauritians authorities have said they will tighten their surveillance of the country's robust financial system to curb fraud and money laundering.

The Financial Services Commission (FSC) said that constant oversight will remain its top priority in the country known for its friendly tax laws.

FSC chief executive officer Clairette Ah-Hen told journalists that investors were increasing being duped by venture capitalists and scammers even more than ever.

Ms Ah-Hen said several criminal and financial analysts from African nations have been in touch with Port Louis as they seek to combat money laundering activities.

These included Botswana, Kenya, Tanzania and Seychelles. Others such as India, Sri Lanka, Singapore and the USA have also been in touch for information, she said.

New strategies to combat increasing international cases and evolving criminal trends would be mapped out, the FSC chief said.

The Commission has however not disclosed its new measures fearing it may hinder on-going operations.

The country's Central Investigation Division (CID) has confirmed that two major money laundering cases are being investigated but gave few details.

Latest figures from the FIU (Financial Intelligence Unit) show there were 168 cases designated as Suspicious Transactions primarily from banking and offshore.

Since 2007 the FIU reported that approximately 370 cases were deemed highly suspicious, again mainly in the two sectors.

In a recent probe police busted a crime syndicate that embezzled $63 million from about 300 locals. Some 70 individuals are being held.

Major growth

The emerging offshore banking and investment sectors in Mauritius have witnessed major growth helping to boost the prosperous country's economy.

This has also bred the need for financial regulators to counter global financial fraud.

With foreign direct investment peaking at $13.4 billion based on recent IMF figures, there is concern that some of this may involve illegal transactions.

Although Mauritius is regarded as having a highly secure and transparent financial system by the OECD and World Bank, the Mauritian government still has its concerns.

For several years Mauritius has promoted itself as a lucrative low tax jurisdiction, subsequently attracting more foreign investors whilst stepping up investment regulation and fraud detection.

There are fears however that the country is heading down the tax haven route, hence becoming attractive to fraudsters and tax dodgers, according to reports in the Indian press.

India gets nearly 40 per cent of its foreign direct investment from Mauritius, most of which is third country investment.

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