Back to Bizweek
SEARCH AND PRESS ENTER
Latest News

Financial Crimes Commission 

FCC to focus on the supply side of bribery and financial crime  

Mauritius will apply to be a member of the OECD Working Group on Bribery, and the preparatory phase to meet the next Financial Action Task Force (FATF) evaluation will soon start. These two major announcements are from the Director General of the Financial Crimes Commission (FCC) during a presentation forum at the Bank of Mauritius last Friday. Dr Navin Beekarry situated the broader mandate of the institution, from investigation to education and prosecution, as moving away from the silo approach in combating financial crimes, as recommended by the FATF.  The Director General insisted on a collaborative approach in both the public and private sectors.

Dr. Navin Beekarry, Director General of the Financial Crimes Commission
Dr. Navin Beekarry, Director General of the Financial Crimes Commission

Some people thought that the FCC was a monster.  It’s not!  We need to put our heads together and combat financial crime in a harmonized and holistic approach. It has to be done together. It’s a partnership, and it’s in collaboration that we’re going to be able to build forward. This is the bottom line,” the Director General of the Financial Crimes Commission stated last Friday. Dr. Navin Beekarry was addressing an audience composed of professionals of the banking sector, gathered by the Bank of Mauritius for a presentation on the Financial Crimes Commission (FCC) Act. The event fitted into the function of building up competencies and capabilities of different stakeholders, including the bank owners, about financial crime, corruption and money laundering. 

 

What is the FCC?  What’s it all about?  Where’s it coming from? Where are we going? The former Independent Commission Against Corruption (ICAC) was described as a three-branched approach.  It was investigating, prosecuting corruption and money laundering offences, and was involved in educational work. According to Dr. Navin Beekarry, the FCC will not limit itself to investigation on corruption and money laundering. It’s going to include fraud, financing of drug dealing, and other offenses that are connected. “From prosecution, collection of statistics, investigation on predicate offence to money laundering, corruption, fraud, and drug trafficking, everything is going to be part of the FCC,” he underscored. 

 

The Financial Crimes Commission (FCC) featured in the Government Program in 2014 and 2019. The intention was to revamp and to come up with a new structure to combat corruption.  “At that particular point in time, I was asked by the late Financial Secretary (Editor’s note: Dev Manraj, G.O.S.K) to do an analysis. He was the one who had set up a committee and I want, for the record, to thank him very much because he had the vision to see what was needed and where we should be going,” the Director General of the FCC stated. 

 

He added that he wrote the report and submitted same to the government shortly before the Covid pandemic, which mobilised the resources and the attention of the authorities. 

At the same time, we were entering or had entered the Financial Task Force (FATF) grey list, and we were working our way through getting out of that list. The interesting coincidence that came out in the FAFT process was the recommendation that we had to make sure that our system was effective. The organisation was referring to the financial system, the anti-money laundering and terrorism financing mechanism, which needed to be reinforced. FATF made a series of recommendations, and two of them were seen as crucial to sustain the changes and the momentum. It was about building the institution and the legislation to make it more effective. 

 

Defense lawyers would always pick on specific complexities and complications in the process, and challenge them in courts

 

The Financial Crime Commission system is said to fit into the context of moving away from a silo approach. Multiple agencies over the years have been set up, according to international obligation and expectation, and were operating in a detached and independent manner, although they were performing functions that were more or less related or closely connected with each other. The silo approach was seen as very challenging. One of the biggest challenges during the evolution of the FATF process was indeed insufficient coordination among multiple agencies.  

 

Those who were with me and who are here today know that it was a real headache to get agencies to start working together, from an international and FATF perspective. It was not a question of institution, it was not a question of sector, it was a question of country… That’s why coordination and collaboration among agencies in a country is crucial in order to be able to meet the international obligation. The silo approach had demonstrated, over the years, certain weaknesses and shortcomings, coordination being one, but there were also other challenges, like legal, procedural… For example, if the ICAC, at that time, was investigating a case, at some point during the process of investigation, it also had to refer the matter to the Asset Recovery Investigation Division of the Financial Intelligence Unit (FIU). These were legal, procedural, and evidential challenges. Drilling down further, should I be handing over all the evidence and the material that I’ve been collecting during the course of the Independent Commission Against Corruption (ICAC) investigation to the Asset Recovery Division or not? It was not as simple as that, because there were legal impediments. So the next question was: Was the Asset Recovery Investigation Division compelled to start an investigation on its own? There was a lot of duplication, overlap and unnecessary complexities. At the end of the day, we all work with one objective, and we’re going to be sending cases to the judiciary. Defense lawyers would always pick on specific complexities and complications in the process, and challenge them in courts. That was one example, but there were numerous examples of different weaknesses and shortcomings,” Dr. Navin Beekarry highlighted. 

 

He mentioned that resources were another challenge. Training of officers at the ICAC and the Asset Recovery Division or the Integrity Reporting Services Agency for the same set of training was seen as duplication, and a waste of time and resources. The recommendations favoured a holistic approach, combining related and relevant functions to eliminate potential weaknesses. 

 

Mauritius also remains a small jurisdiction, with limited resources. “We need to be able to meet one another every day. We need to be able to sit down and talk. That’s our rationale. I keep on reminding that domestic and international cooperation, under the FATF in 2012, used to be recommendation 36. FATF has moved this to recommendation 2. That’s not out of the blue. It’s for a specific reason, because an international organization will focus on the essentials, which are risk assessment and domestic coordination. When the FATF, the IMF and the World Bank were conducting mutual evaluation in countries, they came to realize that domestic cooperation was a big problem. That’s why it is important to ensure strong domestic cooperation, because at the end of the day, it has an important impact on whether your system is effective or not. So a holistic approach brings together the related functions. Asset recovery, unexplained wealth, investigation and prosecution… they are one process. They form one system. The better result will depend on how you’re able to coordinate and eliminate the overlap,” the Director General insisted. 

 

He argued that it’s a question of building better competencies and expertise, and of ensuring greater coordination, since everybody is under the same roof. If the Director General wants to talk about unexplained wealth or asset forfeiture, he will be going to the second floor or the third floor to talk to the officers. One doesn’t need to drive to another location. “That’s the beauty of the holistic system, because you bring together related and relevant resources in order to eliminate all the inefficiencies in the system,” he said. 

 

The FCC Act was voted in December 2023, but the law was proclaimed on 29 March 2024. The mandate is much broader, with education presented as a core component. The awareness and sensitization part is there to build financial literacy on financial crime and its implication, and how it fits in the overall context and objective of trying to combat financial crime and make the country a cleaner place. “It is important for people to understand what financial crime is all about, and what the consequences are. Education is part of combating financial crime,” emphasised the Director General of the FCC.

“There is corruption and bribery in the private sector as well”

 

We have moved away from the demand side. We are now into the supply side, where there is corruption and bribery in the private sector as well. Everybody needs to be part of the solution rather than be part of the problem. I think there is good buy-in from the private sector in trying to be part of the solution, and there has been quite a lot of development and evolution from the private sector. From the time of ICAC in 2002, the private sector didn’t want to be concerned with corruption and bribery, but I think there has been a very good and positive evolution in the private sector at this level”, the Director General of the FCC emphasised. 

 

He stated that the next big thing for the FCC is a platform to build public-private partnership. There is a need for the private and public sectors to collaborate in combating financial crime, including by providing intelligence and information, Dr Beekarry said. 

It’s also important to understand that there is a need for a platform to build trust. The public-private partnership is inspired by the London model, which is a joint money laundering intelligence taskforce. “We are meeting with them, we have integrated it into the legislation, and we’re going to set it up soon. And this has to be differentiated from the FIU function, which is a purely intelligence, financial intelligence, gathering platform structure. This goes much beyond financial intelligence. It’s going to build more in terms of collaboration and coordination among the private sector and between the private sector and public sector. We have strong whistleblowing protection. This is going to touch on the public and private whistleblowing process and system, which we are setting in place. This is another main newcomer into the legislation. We did have whistleblowing protection in the previous legislation, but it was rather weak. This one is going to be more developed. And then, of course, we have more powers, including access to financial information from the different sectors, for us to be able to carry out our job,” the Director General explained. 

The audience during the presentation of the Financial Crimes Commission Act, at the Bank of Mauritius last Friday.
The audience during the presentation of the Financial Crimes Commission Act, at the Bank of Mauritius last Friday.

“The FCC Act includes foreign bribery”

 

During the Q&A session, the Director General of the FCC answered that there is not only private sector bribery, but foreign bribery as well. Mauritius being an international financial sector, all the transactions are not restricted to the country, and can be cross-border. The movement of assets in any transaction has an international and regional dimension in the sense that assets move around. 

 

There’s only one word that captures everything in financial crime. It’s risk-taking

 

The FCC Act includes foreign bribery, which will unveil the movement of assets, across borders, in specific sectors. How will the banking sector be impacted by the FCC? “If you commit an offence under the law, you’re of course going to be impacted, because you will have to report to the FCC. Hypothetically speaking, I’m sure that, at some point in time, there will be a complaint. At the personal and individual level, there is an impact,” the Director General of the FCC stated. 

 

Dr Beekarry reminded the audience that there’s only one word that captures everything in financial crime. It’s risk-taking. Are you taking the risk? Have you thought about the risk? What are the implications? If you’re getting involved in a transaction that potentially involves a financial crime, you’re taking a risk. Addressing the risk is basically what the legislative and institutional setup is all about. In other words, it is trying to protect you by making you understand what the risks are. “If you don’t want to play the game, you still have the jail waiting. It’s part of the process. But I’m sure that the better and the more people understand, the more comfortable they will be in trying to avoid unnecessary risks” 

Mauritius will apply to be a member of the OECD Working Group on Bribery

 

The Director General of the FCC announced that he will be meeting international organizations such as the FATF, and that Mauritius will apply to become a member of the OECD Working Group on Bribery. “Mauritius is going to apply to become a member of the OECD Working Group on Bribery, which sits in the OECD building where the FATF sits. There’s no link between the two, but there exists an indirect one. Whatever the Working Group on Bribery does in combating bribery fits into the FATF mandate of combating money laundering and terrorism financing,” he underscored.  

 

Why is the OECD important? To this question, Dr. Navin Beekarry emphasized that the OECD looks at one particular aspect of combating financial crime, which is known as the supply side. He added that the supply side of bribery and financial crime is going to be an important part of the mandate of the FCC, in its mission to combat financial crimes.

“Nobody wants to go back to the FATF Grey List”

 

The Director General of the FCC informed the stakeholders present at the Bank of Mauritius last Friday that Mauritius will soon embark on the preparatory phase to meet the next Financial Action Task Force (FATF) evaluation, which is scheduled for June 2027. The National Risk Assessment and the midterm review that are going to shape up until December are expected to provide the building blocks leading to the elaboration of a strategic action plan to move forward in terms of preparing and getting ready for the next round of evaluation. 

 

It’s going to be more challenging in terms of what we have been able to do to keep being number one in Africa.

 

Nobody wants to go back to the FATF Grey List. I don’t want to be there. I’ve been through it once, and it was a really stressful time. Nobody wants to go through this. So we better prepare ahead of time, and be proactive and reactive. It’s a difficult and challenging task. This is where the FCC fits in. I led the preparation from December 26th, 2020 to October 2021 and everybody who has been with me knows how challenging it was, but we managed to get out of the FATF grey list six months ahead of time. The challenges, this time, are different. How and why? Because we have set the bar a bit high. We were one of the countries that really demonstrated our ability to meet the international obligation, and came out of the list mentioned above earlier. Every country now refers to Mauritius as an example, and we have worked with quite a few countries to assist them. The situation will be different. It’s like being the world champion in soccer, and having to play the next round and trying to be the champion in the next round as well. It’s going to be more challenging in terms of what we have been able to do to keep being number one in Africa. There was a table that came up two weeks ago on the different countries. It was an evaluation by the FATF of Mauritius, and we are number one. We need to be able to put our heads together and work on this. We have two and a half years to do that. I’m confident that with this close collaboration, we’re going to be able to do it,” Dr. Navin Beekarry said. 

Skip to content