08 November 2015

Anil Gujadhur: Could the BAI case have been handled more prudently?

The answer is in the affirmative. Economic and financial crimes have taken place in other countries in recent years but governments have handled them with such care and caution that they have not hurt the inherent confidence that the public should always have in the economic architecture of the country.

Since 2nd April 2015, the BAI case has created a full range of tumult in the country. The country has lost its usual serenity. Even if that is restored somehow or other at some stage, one is not certain whether it will be business as usual thereafter.


It is not quite clear also whether the ‘Good Governance and Integrity Reporting Bill’ currently under discussion in Parliament – which aims to give powers to a non-judicial Agency in the Ministry to inscribe properties of “unexplained wealth” holders for eventual disposal of such properties by it through sale -- will overcome normal legal procedures to defeat claims the owners of the BAI may present against the government in this case. Procedures of the sort will obviously send the signals to all those who may be concerned, notably investors…

If the financial institutions belonging to the BAI group were not granting financial facilities in accordance with the rules of prudence imposed on them under regulatory rules, the regulators are empowered to stop it before it assumes alarming proportions. Did loans given by the banking arm become non-performing, including from the group’s companies? If so, the banking regulator has the power to ask the shareholders to cease distributing any dividends to themselves and to inject in a timely manner the additional capital required to compensate for loss of capital on account of the non-performing advances…

Mauritius Times

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