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Mauritius - Tracking unexplained wealth.

Summary: A new law enacted in Mauritius seeks to promote financial transparency.

Mauritius enacted legislation this year to track down il- licit enrichment and pro- mote transparency and good governance. Mauritians who appear to have no lawful income to justify their expensive lifestyle or possessions will be scrutinised.

Under the new Good Govern- ance and Integrity Reporting Act, an individual's property can now be confiscated if he or she cannot explain how they acquired it.

An Integrity Reporting Services Agency has been set up to receive and verify reports that an individual is in possession of unexplained wealth. Anyone thus identified is written to and asked to explain the source of the wealth within 21 days. If unexplained wealth is detected, the agency may confiscate the property concerned.

Mauritius already has institutions such as the Financial Intelligence Unit, the Independent Commission Against Corruption, the Enforcement Authority established under the As- set Recovery Act, the Commission- er appointed under the Dangerous Drugs Act, the Mauritius Revenue Authority and the Mauritius Police Force in its arsenal to combat illicit enrichment or unexplained wealth.

Prime Minister Sir Anerood Jugnauth said in Parliament that he believes that assets which are the pro- ceeds of crimes affect the economy and society as a whole, and consti- tute a threat to democracy as they alter the basic rules and impose non- democratic behaviour.

"Today's criminals are increasingly white-collar businessmen as well as public and private sector individuals ... We are targeting unexplained wealth and ill-gotten gains, not individuals ... We are not against the rich or the accumulation of wealth per se," he said.

On the business front, barrister Penny Hack, a consultant at Mahons International Mauritius, believes the law will be catastrophic for busi- ness in Mauritius. "When property rights are attacked, the basis of our democratic system itself is attacked because the right to property con- stitutes a pillar of our economy. This may affect foreign investment," he told local media.

Lawyers at the Mauritius Bar Council argue that while the Con- stitution says that any suspect has the right to a public hearing, this new law legalises the seizure of property following civil procedures conducted only in Chambers.

The Bar Council is also concerned about the burden of evidence placed on a suspect. Property can be seized even if there is no evidence that links it to an offence. "So there is a risk, for example, that liberal use of these powers may result in those who have failed to keep receipts or records los- ing their lawfully acquired assets," it believes.

Its lawyers also say that there are no limits on the information that can be requested in an inquiry into illicit enrichment. As well as an in- dividual's financial life, it could also concern his or her family and busi- ness partners.

Mauritius remains the top-rank- ing country in overall governance in Africa for the ninth consecutive year, according to the Mo Ibrahim Index of African Governance 2015, an annual statistical assessment of the quality of governance in every African country.

"We are targeting unexplained wealth and ill-gotten gains, not individuals ... We are not against the rich or the accumulation of wealth."

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Publication:African Banker
Geographic Code:6MAUI
Date:May 31, 2016
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