A Conflict of Interest
The revelations of financial mismanagement and corruption tied to the Police Cooperative Society (Polco) in the Maldives are the latest examples of why security forces should never be in the business of business. The recently published audit report on the police housing project details an alarming pattern of inflated costs, questionable contracts, and incomplete work that has dragged on for more than a decade, resulting in over MVR 1 billion spent and a loss of MVR 354.7 million incurred.
When government institutions, particularly those in law enforcement, step into the private sector, the implications go far beyond financial mismanagement. They distort competition, discourage private investment, and introduce conflicts of interest that erode public trust. This is not a problem unique to the Maldives, as across the world, in economies that respect the principles of free markets, security forces do not build apartments, run catering services, or manage business portfolios.
How It’s Done Elsewhere
The argument for such ventures often hinges on welfare—providing additional income and benefits for police officers and soldiers. But there are better ways to support them. In countries with strong governance frameworks, welfare for security personnel comes from well-structured state policies, not profit-driven enterprises. In the United Kingdom, for instance, police officers have access to government-funded housing support without involving police-run corporations. In Germany, military cooperatives exist, but they do not engage in commercial competition, limiting their role to internal support services.
The Police as Developers: A Billion-Rufiyaa Disaster
Polco’s downfall follows a familiar pattern. It was never meant to be a property developer, yet it took on a multi-million-dollar project despite having no expertise in large-scale construction. The results were disastrous, with the project being handed from one contractor to another, draining more funds with each transfer. The irony is inescapable – the police, whose role is to prevent crime, have become central players in a case that reeks of corruption and corporate misconduct.
Public Outrage and Calls for Reform
There is now growing public outcry, with demands for Polco and its military counterpart, Sifco, to be dissolved. People are asking the fundamental question: why should the police and military be running businesses at all? These are institutions that already receive the largest share of the national budget. If that is not enough to sustain their operations and welfare needs, the solution is not to compete in the market but to reassess how those funds are allocated.
The Bigger Danger
The more state institutions entangle themselves in business, the more blurred the lines become between governance and enterprise. And when those in power control both the regulatory framework and the businesses operating within it, corruption is not a possibility—it is an inevitability. The lesson from Polco’s controversial housing project is clear: security forces should not be in business. Their mandate is to protect the people, not to engage in corporate ventures that distort the market and open the door to financial scandals.
