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MMA negligent in MMPRC corruption scandal: ACC report

Fathmath Shaahunaz
15 February 2019, MVT 18:18
A snapshot from the teaser of 'Stealing Paradise', an expose by Al Jazeera detailing the MMPRC corruption case.
Fathmath Shaahunaz
15 February 2019, MVT 18:18

Maldives Monetary Authority (MMA) had neglected to take action in the embezzlement of state funds from Maldives Marketing and Public Relations Corporation (MMPRC), revealed the report publicised by the Anti Corruption Commission on Thursday.

The largest graft scandal in the history of Maldives, the MMPRC corruption saw the embezzlement of over MVR 1.3 billion, acquired via island and lagoon leases for tourism, through a private company SOF Pvt Ltd.

According to the report, MMA's Financial Intelligence Unit (FIU) had been informed in detail of the suspicious transaction of a cheque for USD 59 million from MMPRC to SOF. The private company is owned by people close to former Vice President Ahmed Adeeb, who is currently serving a hefty jail sentence over his involvement in the MMPRC scandal.

FIU had investigated the issue and compiled a report, which detailed the accounts SOF opened in various banks of Maldives from July 2014. ACC revealed that SOF had received USD 18 million from MMPRC, as per the report.

FIU's analysis report showed that MMPRC had deposited USD 9.1 million to SOF's accounts between August and November 2014 alone.

FIU had highlighted in its report that, based on SOF's business profits and account balances, the company was not capable of legally making such transactions.

Despite the suspicious nature of the deposits, FIU concluded that there was no evidence of money laundering with regards to SOF, and decided against filing the case at the authorities for further investigation.

In its report, ACC rejected FIU's claims that there was no money laundering involved, and detailed the reasons.

FIU's negligence

- FIU did not confirm the reasons behind major transactions SOF made via Bank of Maldives Ltd (BML) and Bank of Ceylon (BOC)

- FIU did not look into withdrawals made after a state firm (MMPRC) deposited substantial amounts to SOF's account

- There were no financial statements to indicate whether MMPRC had transferred the money to SOF as payment for any services

- FIU was aware but took no action when SOF refused to provide information requested by BML regarding the money deposited by MMPRC

- FIU had neglected to fulfill its lawful responsibility to forward cases of suspected money laundering to relevant authorities for further investigation

ACC stated that its investigation revealed suspected money laundering in the nature of the MMPRC-SOF transactions, despite FIU's conclusion otherwise.

MMA ex-governor objected to investigation

ACC took the statement of FIU's former head, Ibrahim Athif Shakoor, for its MMPRC investigation.

In his statement, Athif revealed that the then governor of MMA had been urged to further investigate the major transactions of SOF highlighted in FIU's report. The governor of MMA at the time was Azeema Adam.

However, Azeema had objected to filing a police report, with the excuse of lacking sufficient resources, said Athif.

According to the former head of FIU, Azeema had noted that FIU only had four members at the time, and ordered the unit to focus on illegal foreign transactions. She had stated that the unit lacked resources for other investigations at the time, as per Athif's statement.

Although Athif claimed that FIU's report had been submitted to Azeema, some other employees of MMA could not confirm whether the former governor had received the report, in their statement to the ACC investigation.

ACC declared that FIU had been negligent for failing to further investigate SOF's transactions, and for concluding that there were no suspicions of money laundering involved.

The graft watchdog's long awaited report on the shocking MMPRC corruption case revealed that the funds embezzled from MMPRC had been laundered through SOF, with the involvement of a large US dollar exchange network.

The report also exposed the identities and account details of individuals and businesses that received funds from SOF, many of which did not have the capability for such transactions, according to ACC.

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