Financial Crime Commission

Editorial

An apex body to oversee or coordinate the different agencies involved in investigating or preventing financial crimes, has again been mentioned by the Financial Services and Good Governance minister, Mahen Seeruttun, at an MSM party press conference on 5 August. We are informed that a Financial Commission (FCC) bill has been finalised and will be tabled in Parliament in October. This comes following the earlier announcement by Prime Minister Pravind Jugnauth at a forum organised by the ICAC, Bank of Mauritius and Mauritius Bankers Association, last December, about work in progress on an appropriate legislation for the FCC.

A similar announcement was made by Sir Anerood Jugnauth on 7 June 2016 in reply to a PQ pertaining to the proposed setting up of such an institution. Much earlier, there were rumours afoot around 2013 about a proposed merger of the Bank of Mauritius and the Financial Services Commission, presumably with a view to curtailing the recurrence of the kind of loopholes that transpired and were exploited by some unscrupulous scam operators which made the headlines then.

The purpose of the FCC would be to ensure greater coordination among law enforcement agencies and to reinforce public-private partnership in combating financial crime. We have currently six separate agencies involved in tracking financial crime, namely the ICAC, the Financial Intelligence Unit, the Mauritius Revenue Authority, the Financial Services Commission, the Integrity Reporting Services Agency, the Gambling Regulatory Authority, without mentioning the role of the CCID or the Police in investigating financial fraud. Whether the proposed umbrella institution will bring greater coordination among the law enforcement agencies, reporting to different parent ministries, remains to be seen.

There have been grumblings in the past arising from competing agendas, limited communication and information-sharing, mistrust as well as capacity differences between the different agencies at work in the fight against financial crime. There already exists a problem of mistrust between ICAC and the Integrity Reporting Services Agency, which took the unusual route of dragging another State institution – the ICAC – to court for allegedly failing to fulfil its statutory obligations, as prescribed by law, to submit detailed reports instead of summary notes on suspected cases of unexplained wealth.

Legal and institutional overlap and conflicts were perhaps inevitable: as per Section (20) (g), the ICAC has to review the practices and procedures of any public body in order to facilitate the discovery of acts of corruption and to secure the revision of methods of work or procedures which, in its opinion, may be conducive to corruption. Under Section 4 of the Good Governance and Integrity Reporting Act 2015, the latter has powers to request information from any enforcement agency and to call for any person to provide it with documents and other records.

Obviously, there is need for a clean-up either in the form of a new single lead Agency for investigating all financial scams, frauds, money-laundering and corruption activities or an apex organisation that might sit rather uncomfortably over and coordinate the existing disjointed structures with different reporting mechanisms. Both paths have merits and drawbacks. What government seems to have decided upon is the second path which is about the setting up a coordinating superstructure to combat financial crimes and the likely appointment of a financial crime coordinator at its head.

However, at this stage and in the absence of the proposed Bill, which should be circulated well in advance of its Assembly hearing, not much is known about the contours of the FCC, nor whether it would constitute the more effective approach. First, we have to express some surprise that this proposal crops up almost a decade after it was floated and close to the electoral hustlings of 2024, when undoubtedly the singularly inept performance of the ICAC in taking to task those in the spheres of MSM power might crop up. Is it to blunt those expected criticisms or a response to increasing pressure from international agencies with oversight and pushing for more effective financial crimes investigations with court cases for high-profile abusers?

Secondly, the Minister seems to suggest that the different agencies would continue their existence, often with well-paid nominees as Directors and Board members, and there may be nothing to guarantee that another costly super-agency funded from the public purse and barely accountable to Parliament or to a supervisory Commission/Board, would contribute to effectiveness and efficiency.

Other pointedly relevant questions have been raised regarding who would appoint the members or head of the proposed FCC and with what degree of independence and accountability they would operate. It is also not known whether the government would seize this opportunity to re-build trust by proposing to give the head of the FCC constitutional protection in much the same way as the DPP for him/her to be able to function independently, without fear and favour. That would only happen of course if enough members of the Opposition buy into the legislative proposal with such a provision.

Given the experience with ICAC since its inception and its track record to this day as well as with other agencies involved in tracking financial crimes, which have put in doubt the real political will to stamp out corruption and combat white-collar financial crimes, it is not surprising that the proposed FCC is already being viewed, as in the past, as another window-dressing exercise that might only look good on paper or for international agencies consumption. 

Mauritius Times ePaper Friday 11 August 2023