The Financial Crime Commission Act 2023

Establishment of the Financial Crime Commission

The Act introduces amendments aimed at addressing issues that have arisen over the years. It seeks to increase the accountability of organisations engaged in AML/CFT, improve case management oversight, and enhance cooperation among the various agencies and bodies previously responsible for the dissemination of information, prosecution, and investigation of different financial crimes.

The main objective of the Act is to establish the Financial Crime Commission (the “Commission”) as the Mauritian 'apex' agency, tasked with detecting, investigating, and prosecuting financial crimes and the financing of drug dealing. The Commission will consist of a director-general and four commissioners.

The Commission will also consist of various divisions, notably an Investigation Division, an Asset Recovery and Management Division, an Educative and Preventive Division, and a Legal Division, each with clearly separated functions and powers.

The Act is a consolidating legislation that groups corruption, money laundering, fraud, financing of drug dealing, and other offences, previously dispersed throughout repealed enactments, under the concept of ‘financial crime’. These offences now carry harsher penalties, including a fine of up to MUR 20 million and penal servitude of up to 10 years upon conviction for any financial crime.

Introduction of new Financial Crime Offences

New offences, liabilities, and obligations are also introduced through the Act. Notably, the Act creates a list of fraud offences targeting more sophisticated schemes that could escape the ambit of dishonesty offences under the Criminal Code Act 1838. For instance, fraud by abuse of a position by anyone expected to safeguard another person’s financial interest for personal gain or to cause another person’s loss, and electronic fraud, are now distinct criminal offences.

Below is a summary of offences and their respective penalties as provided for by the Act:

Corruption in private entities

The Act delivers a significant message to the private sector by explicitly stating that corruption within private entities is now an offence in Mauritius. It specifically targets acts of bribery involving any employee or member of a private sector entity.

In addition, following the repeal of the Asset Recovery Act 2011, the Act introduces a new framework for the recovery and confiscation of proceeds, instrumentalities of offences, or terrorist properties. It establishes both a criminal-based and a civil-based asset recovery regime, allowing for the application of attachment or confiscation orders. Under the criminal-based regime, such orders require a charge, a conviction, or an ongoing criminal inquiry. Conversely, under the civil regime, attachment orders can be pursued even against individuals not physically present in Mauritius, including those acquitted, if proceedings are stayed or charges withdrawn before a verdict is reached.

The obligations and liability of legal persons under Sections 52 and 53 the Act

Another important aspect of the Act is the obligations and liability of legal persons.  A legal person, as defined under the Act is any entity, including a private entity, other than a natural person. As per Section 52(1) of the Act:

“A legal person shall ensure that it has adequate procedures in place, which are reasonably necessary, to prevent it or any person acting on its behalf from committing an offence under this Part, failing which it shall commit an offence and shall, on conviction, be liable to a fine not exceeding 20 million rupees.”

Similarly, the breach of any guidelines issued by the Commission is also an offence with the risk of a penalty of 10 000 rupees per month until the breach is finally remedied (provided that the total penalty is capped at 1 million rupees).

Moreover, as per Section 53(1) of the Act:

“A legal person shall be guilty of an offence under the Act if any of its directors, senior managers or any other persons involved in its management, or any of its officers, agents or representatives having authority to act on its behalf, commits an offence under this Act for the benefit of the legal person.”

However, as per Section 53(2) of the Act:

“It shall be a defence for a legal person if the legal person proves, on a balance of probabilities, that it has adequate procedures in place designed to prevent any of its directors, senior managers or any other persons involved in its management, or any of its officers, agents or representatives having authority to act on its behalf, from undertaking such conduct.”

Legal persons established in Mauritius will now be required to implement an Anti-Bribery, Corruption, and Fraud Policy. Apex can assist in the development of this policy.

For the full text of the Act, please follow this link:

https://mauritiusassembly.govmu.org/mauritiusassembly/wp-content/uploads/2023/12/act2023.pdf

If you require any more information on the Act, please contact our team.