Tag: maldives

MMA denies US suggestion it has knowledge of terrorist funding

The Maldives Monetary Authority (MMA) has rejected claims by the US State Department that it has any knowledge of funds being used to finance terrorist activities abroad (May 11).

The MMA’s statement came in response to a report from the US government that the authority believed funds from the Maldives were being used to sponsor terrorist activities.

“The MMA has neither received nor communicated any information regarding confirmed operation of terrorist financing activities,” said the MMA.

The US Country Reports on Terrorism 2013 claimed that criminal proceeds were coming from hawala systems (informal money transfer networks) to transfer money between islands.

“Maldivian authorities believe that funds are currently being raised in Maldives to support terrorism abroad; however, there is no reliable information regarding the amounts involved,” read the US report.

“While no official studies yet have been conducted, the Maldivian Central Bank believes that criminal proceeds mainly come from domestic sources, as a large percentage of Suspicious Transaction Reports (STRs) are related to Maldivians,” it continued.

The Maldivian Democratic Party (MDP) has today cited the US report as evidence that the government is not doing enough to combat terrorism.

“The Maldivian Democratic Party strongly condemns the government’s failure to bring an end to terrorist and extremist activities as funds are raised in the Maldives to fund terrorism abroad,” read a press release today.

The party suggested that examples of Maldivians engaging in extremism and terrorism was on the rise, suggesting the government was not doing enough to resolve organised criminal activity in the country.

In response to the US report, the MMA has contended they have not received any confirmed suspicious transaction reports related to terrorist financing in the Maldives through formal or informal money transfer networks.

The authority also expressed confidence in the industry’s framework for preventing such operations, adding that any companies that are under their supervision are subject to the Anti-Money Laundering and Combatting the Financing of Terrorism (AML/CFT) obligations.

AML/CFT legislation drafted by the MMA was passed by the People’s Majlis last month and ratified by President Abdulla Yameen on April 13.

The new law introduced rules governing financial transactions and the inflow and outflow of money from the Maldives.

“We are pleased to note that most of these financial institutions have internal policies, procedures and programs to implement those obligations,” the MMA statement added.

The US State Department had further noted growing concern since 2010 “about the activities of a small number of local violent extremists involved with transnational terrorist groups”.

“There has been particular concern that young Maldivians, including those within the penal system, may be at risk of becoming radicalized and joining violent Islamist extremist groups. Links have been made between Maldivians and violent extremists throughout the world,” the report stated.

The department also suggested that the Maldives has few laws which effectively control the movement of people and money into and out of the country, adding that due to its “sprawling island geography and insufficient technological capabilities” the coastguard could not effectively patrol the territory.

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Maldives must ensure it does not become hub for people smuggling: Defence minister

With additional reporting by Lucy Lovell

The Maldives should take precautionary steps to ensure that it does not become a hub for people smuggling, Minister of Defence and National Security Mohamed Nazim said on Sunday.

“This smuggling of people is done by garnering a lot of financial aid. People smuggling has become a huge business globally.”

“We must do all necessary to inhibit people smuggling through the Maldives,” said the minister.

Despite the recent introduction of legislation to address the country’s longstanding problems with human trafficking, doubts persist over implementation, as well as the law’s capacity to prosecute human smuggling – different to trafficking in that individuals give a measure of consent to be transported illegally.

Speaking at the inauguration of a workshop titled ‘Capacity Building for Front line Investigation and Border Control Officers to Combat People Smuggling’ – which started in Kurumba Island Resort on Sunday – Nazim spoke of the important role that can be played by immigration and police officers to prevent people smuggling.

He further stated that the immigration cell established at the Immigration Department needs to further develop and function more strongly in the future.

“We in the Maldives do not want anyone to use our borders to illegally cross into other countries. Even quite recently, we came across some Syrians who used the Maldives as an intermediary to travel onto another country.”

“We must ensure that the Maldivian border is one which is safe and protected, and that people are aware of this security,” added Nazim during the event organised by the International Organisation for Migration, and the Department of Immigration and Emigration.

Smuggling concerns

The defence minister – also in charge of the immigration department – announced plans to apprehend and deport all undocumented foreign workers from the capital Malé within four months.

Local NGO Transparency Maldives recently estimated that the number of migrant workers in the country could number as many as 200,000 – a figure that amounts to two thirds of the country’s population.

The Maldives’ first anti trafficking legislation was ratified by President Abdulla Yameen in December last year, receiving a mixed responses from the Human Rights Commission Maldives (HRCM).

Assistant Controller Ali Ashraf from the HRCM described the new legislation at the time as “an excellent piece of work”, though he noted that the failure to include the category of smuggling in the act made it very likely that offenders would be able to evade prosecution.

“The definition of trafficking can be twisted so easily,” warned Ashraf.

The HRCM has also raised the issue of Syrian refugees – mentioned by the defence minister today – using the Maldives as a transit point back in November 2013.

A leaked document from the immigration department, obtained by Minivan News last year, that the Maldives status as a tourist hub granting free visas upon arrival to over one million tourists a year, made it increasingly attractive as a transit destination

Previous case studies on several refugees appeared to reveal inconsistencies with the immigration department’s decisions, with similar refugee cases receiving different verdicts from Maldivian authorities.

HRCM member Jeehan Mahmood argued that the government’s inconsistencies resulted in discriminatory practices inappropriate to a country aspiring to uphold its human rights obligations.

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Man arrested for sexually abusing a child with disabilities

Police have arrested a man on charges of sexually abusing a 13 year old girl with disabilities.

The arrested man is a 25-year-old male – reportedly a friend of the victim’s family.

Both the victim and the arrested man are from the island of Gaafaru in Kaafu Atoll.

While confirming the arrest, police declined to provide further details on the case.

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MRDC contracted to build roads in Fonadhoo

The Ministry of Housing and Infrastructure has contracted the Maldives Road Development Corporation to build nine main roads in the island of Fonadhoo in Laamu Atoll.

The project is estimated to cost MVR47 million (US$3 million) which is funded for in the state budget.

The roads are to be built with tar, while the first phase will see the construction of pavements in all nine roads.

As per the agreement, the project is to be completed within 18 months after the work commences.

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MACL can sue former chairman over GMR airport charge decision, says Civil Court

The Civil Court has ruled the Maldives Airports Company (MACL) can sue its former chairman for allowing the disputed Airport Development Charge (ADC) to be deducted from Indian infrastructure giant GMR’s concession payments during it’s ill-fated agreement.

MACL alleges ‘Kuda Bandhey’ Ibrahim Saleem’s decision to be an act of ‘Ultra Vires’ – meaning that Saleem had acted beyond his permitted authority.

The ruling came following a procedural issue taken by Saleem said he was being wrongfully charged claiming the lawsuit was filed in violation to Article 18 (c) of the Contract Act and Article 74 Company Act.

The Contract Act states a clause requiring a party to refer to arbitration any dispute arising from the contract shall be valid, while the Company Act says the court has a right to issue orders holding personally liable the directors of the company to commit an offense in the name of the company.

But the Civil Court ruling stated that the Company Act does not prohibit the company chairman from being sued personally.

The airports company sued Saleem after he signed a letter sent to GMR on January 5 2012 stating that the ADC and the insurance surcharge fee had been deducted from GMR’s concession payments.

In late 2011, the then-opposition Dhivehi Qaumee Party (DQP) had filed a successful Civil Court case blocking GMR from charging US$25 charge for outgoing passengers – stipulated in its agreement with the government – on the grounds that it was a tax not authorised by parliament.

Former President Mohamed Nasheed’s administration subsequently chose to honour the original contract, instructing GMR to deduct the ADC revenues from the concession fees due to the state-owned MACL while it sought to appeal the Civil Court ruling.

However, with the Nasheed’s controversial resignation coming just one month later, the opposition soon inherited the contractual problem.

Dr Mohamed Waheed’s government then received a succession of bills from the airport developer throughout 2012, despite its insistence that the January 5 letter from MACL outlining the new arrangement was no longer valid.

In December 2012, the Anti-Corruption Commission (ACC) filed a case with the Prosecutor General’s Office over Saleem’s decision to allow GMR to deduct the ADC from concession fees owed to the state.

As part of the filed case (Dhivehi), the ACC was seeking reimbursement of MVR 353.8 million (US$22.9 million) from Saleem and former Finance Minister Mohamed Shihab over the alleged misuse of authority it claimed had led to significant financial loses for the state.

These losses were used as justification for the contract’s eventual termination in December 2012, for which GMR is currently seeking compensation via a Singapore court of arbitration.

According to the case filed by the ACC, former Finance Minister Shihab stands accused of misusing his ministerial authority to benefit a third party by allowing GMR to deduct the charges between October 2011 and September 2012.

The ACC has also accused Saleem violating the company’s rules. According to the ACC’s case, normal procedure for MACL would be to have the company’s board of directors pass a resolution allowing for consent to be given to deduct the ADC.

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14-year-old victim of sexual abuse gives birth to second child

A 14 year old girl has been taken in by the authorities after she gave birth to her second child. She had reportedly given birth just two years earlier at the of age 12.

Haveeru reported that police and other relevant authorities came to know of the girl after a report surfaced that she was being sexually abused and then blackmailed.

Police have arrested a 53-year-old man in relation to the case.

According to local media, Police have handed care of the girl to the Gender Ministry and both her children are under the state’s care.

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Ashfaq appointed as Maldives’ first sports ambassador

The Maldives Olympic Committee has appointed national football team captain Ali Ashfaq as the country’s first sports ambassador.

“This is a great success, an honour. I will work with the government and sports associations to improve and promote the Maldives sports sector. I would like to thank senior members of the olympic committee for this great honour. I am very pleased,” he told local media.

As Maldives sports ambassador, Ashfaq will work to promote sports amongst children and younger generations and aid Maldives sports teams in seeking better recognition in the international arena, say reports.

The letter of appointment was presented to Ali Ashfaq at a special event at Traders Hotel, Malé.

Speaking to Sun Online, Ashfaq thanked the Maldives Olympic Committee and said he was looking forward to working with the different sports associations to improve the Maldives sports sector.

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Boskalis committing “environmental crimes” in UNESCO biosphere reserve, says Ecocare

Netherlands based maritime infrastructure company Royal Boskalis Westminster is committing “serious environmental crimes” in the Maldives, a local environmental group has said.

The company – claimed to have the world’s largest dredging fleet –  has come under fire for mining sand from the country’s only UNESCO biosphere reserve in Baa Atoll.

It also failed to build a barrier to prevent excess dredge soil from spilling onto the reef in Baa Atoll Eydhaushi Island – a move that could cause serious damage to the fragile ecosystem.

“Boskalis has to leave the Maldives now,” Ecocare founder Maeed M. Zahir told Minivan News.

The US$ 37 million four-island reclamation project has reclaimed 20 hectares in Dhaalu Atoll Meedhoo Island in March and 33 hectares in Baa Atoll Eydhafushi Island last week. Work is ongoing on Kaafu Atoll Thulusdhoo Island while a date for reclamation in Dhaalu Atoll Kudahuvadhoo Island has not yet been set.

In the two islands where reclamation was completed houses and vegetation on the shorelines were also covered in fine mixture of sand and salt due to the use of the “rainbow technique” which propels soil into the air.

The Health Protection Agency (HPA) has previously said fine sand particles thrust into the air by the rainbow technique could cause lung and respiratory issues.

Housing Ministry complicit

Maeed accused the Housing Ministry of being complicit in Bosaklis’ violation of environmental regulations, noting the Environmental Protection Authority (EPA) had issued several warnings ordering the company to stop unsafe dredging.

“The Housing Ministry’s failure to stop the project means the ministry is pushing Boskalis. By the time, the EPA warnings arrive, the damage is already done,” he said.

Minister of Environment and Energy Thoriq Ibrahim told Minivan News the EPA is investigating the case.

According to Maeed, the EPA had said it will impose a fine on Boskalis, but the agency has failed to do so. He called for the EPA to be removed from the Environment Ministry’s remit and given greater powers as an independent body to prevent violations in the future.

Boskalis began dredging in Meedhoo in March, but the EPA halted the project temporarily for failure to follow procedures recommended in an environmental impact assessment report.

Instead of using pipelines to transport dredged sand to the shore, Bosaklis dredgers propelled sand and salt through the air covering houses and vegetation on the shoreline in debris.

Housing Minister Mohamed Muizz told local media at the time that safety measures would be followed in the future.

However, Boskalis used the same techniques in Baa Atoll Eydhafushi Island, and furthermore, dredged sand from the UNESCO biosphere reserve and transported it to Thulusdhoo Island in Kaafu Atoll for ongoing land reclamation.

Eydhafushi residents spotted a Boskalis dredger carrying sand away from the island this weekend, and raised the issue with the EPA.

Eydhafushi Island Councillor Mohamed Riza said the company had not sought permission from the local government to mine sand from the atoll.

Baa Atoll was declared a biosphere reserve in June 2011. It is the first of it’s kind in the Maldives.

President Abdulla Yameen inaugurated the Thuludhoo reclamation project this morning.

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Maldives “ideally placed” to be international financial centre, says CMDA chief

CEO of the Capital Market Development Authority (CMDA) Fathimath Shafeega believes the Maldives to be “ideally placed” to play the role of an international financial centre.

Describing the country as strategically well-placed, the head of the independent regulatory authority noted that the country’s nascent financial framework was both a weakness and a strength.

“We don’t have regulations hindering a lot of things,” noted Shafeega. “We can start from a clean slate.”

“But parliament needs to be very much involved in it. We might need to provide the software – laws and regulations and other policy frameworks – while investors can bring the hardware.”

Senior members of both the previous and the current administration have considered the development of offshore banking services as a way to diversify an economy heavily reliant on tourism.

“It’s very much still on the agenda,” said Shafeega.

Shafeega spoke with Minivan News following the release of the CMDA’s first quarterly report in 2014, which revealed the authority’s work this year had focused on drafting legislation to further modernise the market, as well as amending the Corporate Governance Code in order to increase gender diversity on the boards of publicly listed companies.

Islamic Finance

Established by the Maldives Securites Act in 2006, the CMDA’s quarterly report for the first time included details of the Islamic Capital Market – an area the report describes as having an “ever-green future in the Maldives”.

Indeed, Shafeega argued that the successful establishment of an Islamic Capital Market – featuring Shariah compliant financial products – would also add to the Maldives appeal as a future financial hub.

Introducing the quarterly update on the Islamic Capital Market development, Deputy Islamic Minister Dr Aishath Muneeza, argued that there was now a “global movement towards the creation of financial transactions based on underlying activities or underlying assets.”

“Relying on real economic activities has been the success secret of Islamic finance and now we are being forced to find innovative ways to adopt this method,” said Dr Muneeza.

Under Islamic Shariah, any risk-free or guaranteed rate of return on a loan or investment is considered riba, which is prohibited in Islam.

Also chair of the Capital Market Shariáh Advisory Council (CMSAC), Dr Muneeza this quarter became the first person granted Shariah advisor registration status in the Maldives.

CMSAC was created in December 2013 in order to advise the CMDA on the development of an independent Islamic Capital Market.

The council’s activities this quarter included the formulation of a five year plan to increase the availability of Shariah compliant services, raise awareness of Islamic finance, and establish an Islamic Finance Centre in the Maldives.

Writing for the Islamic Finance News website in March, Dr Muneeza  described Islamic Finance as “spreading like wildfire” since the introduction of Islamic banking and capital market services in 2011.

“It is hoped that in the upcoming years the Maldives can be used as a global case study to prove the success of Islamic finance,” she wrote.

Pensions

Shafeega also expressed confidence that the state pension fund – for which the CMDA plays a supervisory role – can soon successfully diversify its investment portfolio.

“As you know the pension system in Maldives has assumed that there will be a developed capital market. The development of the capital market has not kept pace with the pension development.”

Beginning in March this year, the government more than doubled the monthly pension – with individuals aged over 65 now receiving MVR5000.

The government had allocated MVR470 million (US$30.5 million) in the state budget to give out an MVR2,300 (US$149) in cash handouts, with head of the Cabinet’s Economic Council Ahmed Adeeb stating that “innovative” investment would prevent the need to divert funds from within the current budget.

The CMDA quarterly report noted that research had been carried out in order to ascertain potential avenues for investment beyond government or listed securities – the only options currently utilised.

“For the pension fund to be able to generate a good return for the members, we need to diversify the pension investment,” Shafeega told Minivan News.

“We need to find alternative investment that can generate a good return”

Shafeega also expressed confidence that the additional revenue could be realised, revealing that – following the authority’s recommendations – the government was planning to introduce changes to the Pensions Act during the 18th Majlis.

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