Working Together to Fight Money Laundering and Terrorist Financing

Proposals for a National Strategy

by Dev Bikoo Director FIU

18 th April, 2006

Hilton Mauritius Resort and Spa Wolmar, Flic-en-Flac

Plan Achievements in AML/CFT Assessment and Need for AML/CFT Strategy Proposed Components of a National Strategy Implementation of AML/CFT Strategy Concluding Remarks

ECAML (2000) DDA (2000) FIAMLA (2002) POCA (2002) POTA (2002) AML/CFT Achievements

Main Legislation

FIAMLA Regulations (2003) Anti-Money Laundering (Miscellaneous Provisions) Act Mutual Assistance in Criminal and Related Matters Act (2003) Amendments to POCA (Sept 2005 / April 2006) 1

Conventions

UN Convention Against Transnational Organised Crime

(Palermo Convention)

International Convention for the Suppression of the Financing of Terrorism UN Convention against Corruption (

Merida Convention)

(i) (ii) (iii) AML/CFT Achievements Supervision

Bank of Mauritius

Guidance Notes on AML/CFT (Nov 2003, June 2005)

Financial Services Commission

AML/CFT Codes for Insurance Entities, Investment Businesses and Management Companies Supervision Techniques / Approaches Investigation Investigatory Authorities under FIAMLA Independent Commission Against Corruption (ICAC) Commissioner of Police Comptroller of Customs 2

AML/ CFT Achievements The Financial Intelligence Unit Capacity Staff of 24, In-house Training, Overseas Training, IT Infrastructure Input 400 STRs, Anonymous Letters, “Derived STRs”, Requests of Foreign FIUs Output 200 Disseminations, 85 cases of “Unreasonable” Suspicion Non-Core Functions Awareness Creation, Training, Strategic Reports Domestic Co-operation National Committee on AML/CFT, MOU with FSC, Police, Customs Regional Co-operation ESAAMLG & FIU Development in the Region International Co-operation Egmont Committee, Egmont Outreach Working Group Sponsoring Indian FIU (FIU-IND) 3

Assessment / Need for Strategy International Community • FATF, FSRB – ESAAMLG, IMF/World Bank, Egmont Group Reporting Institutions • Training of Staff, Internal Procedures • Cost of Compliance?

• Survey Non-Reporting Institutions • ? Exempt from CDD, Record Keeping Public • Survey Results AML/CFT Stakeholders • ? Different Perspectives. • National Committee Perspective 1

Assessment / Need for Strategy

Do we need a national AML/CFT Strategy?

• Assessment of current situation!

• Development Strategy of Government  financial stability, reputation risks  remove economic distortions of ML/TF activities  credit worthiness and greater FDI  tools for regulators and law enforcement to protect Mauritius from negative effects of organised crimes and activities of criminal syndicates  robust financial institutions - Better participation in global financial & trade systems 2

Proposed Components of a National AML/CFT Strategy Legislation • Meeting international standards • Avoiding ambiguities, inconsistencies or loopholes Supervision • Smarter risk-based approach • Compliance cost – Alternative Forms of ID / Electronic verification • Other gaps and challenges Investigation • Effective and rapid investigation • Successful prosecution • Other challenges Others • Awareness and Communications • Training 1

Proposed Components of a National AML/CFT Strategy Domestic Co-operation • Converging Approach Friends not Competitors !

• National Committee on AML/CFT International Co-operation • Commitment to International Standards •Exchange of Information 2

Proposed Components of a National AML/CFT Strategy The Financial Intelligence Unit (A)

Striking the Right Balance

Supply of Input Demand for Output 3 CAPACITY

Proposed Components of a National AML/CFT Strategy

Capacity

Analytical Skills and Technology IT Solutions The Financial Intelligence Unit (B)

Core Functions

Protection of Data    

Supply of Input

Reporting Gaps LCTRs, CBTRs Awareness Campaign on Role of FIU as a “Central Agency” Training of MLROs Foreign FIUs

Demand for Output

 Investigators, Regulators, Others   Feedbacks Involvement in Regional and International AML/CFT initiatives 4 • Non-Core Functions Training, Preventive Role – Strategic Reports, Regional Commitments

Implementing a National AML/CFT Strategy Strategy: What to do? How to do it? What resources are required?

Responsibilities • National Committee on AML/CFT • AML/CFT Stakeholders • A Strategy Team?

Assigning Resources to Project Technical Assistance / Consultant?

Time Table of Key Events in Preparing Strategy Consultation

Concluding Remarks Ground work has started at National Committee level Urgent need for a clear, well-defined and realistic AML/CFT strategy FIU Presentation - Plant Direction Flags for Discussions Final Components of Strategy and Plan is a Government Decision