Home minister: Expats running corner stores as illegal USD exchangers

Expatriates are being seen operating corner stores as illegal US dollar exchangers, says Homeland Security Minister Ali Ihusan.

Speaking at a press briefing on Monday afternoon regarding the crackdown on illegal USD exchange, Ihusan said the authorities were investigating 12 expatriates believed to be involved in large-scale exchange of USD exchange in the black market.

He said that the authorities were tipped off regarding these individuals via the hotline.

Nine of these individuals are currently in detention, he added.

Ihusan said that some expatriates were transferring their salaries to business bank accounts registered to Maldivians and converting it to dollars on a daily basis. He said that several expatriates have been caught at the border attempting to smuggle dollars out of the country.

Ihusan said that several businesses and expatriates were also under investigation for misusing TT services to send dollars out of the country.

“We have been observing expatriates opening corner stores and operating it as dollar exchangers. Expatriates have also been sending their salaries to business accounts registered to Maldivians, and then taking it and converting it to dollars on a daily basis, and have been caught at the border attempting to smuggle out dollars collected in this manner,” he said.

Ihusan also warned Maldivians against getting involved in such crimes.

Maldivians must stop attempting to bail out expatriates detained in such cases by claiming them to be cooks or drivers employed in their homes, he said.

Recent amendments to the Foreign Currency Act prohibit the advertisement or promotion of foreign exchange at rates exceeding those officially determined by the central bank. The disclosure, publication, or dissemination of black-market exchange rates through digital platforms or any other medium is now punishable with fines of up to MVR 500,000 for individual offenders and up to MVR 5 million for legal entities or registered businesses.

Meanwhile, the threshold for mandatory foreign exchange by non-tourism sector businesses earning dollar revenue has been raised from USD 15 million to USD 25 million per annum. Such businesses are required to exchange 40 percent of the monthly revenue in general, but seven percent if its 100 percent Maldivian-owned.

At the same time, Category A establishments (resorts, integrated tourist resorts and private islands) are now required to exchange 40 percent of monthly revenue, and Category B establishments (guesthouses, hotels, liveaboards) are required to exchange 20 percent or USD 25 per tourist.

The government says the amendments were made to retain US dollar revenue generated by the country within the local economy