Malta’s Financial Services Industry Relies Heavily on Compliance Officers to Navigate Regulations
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In Malta’s tightly regulated financial services industry, compliance officers play a crucial role in guiding operators through the complex maze of laws and regulations. With the risk of non-compliance always present, especially in an overly regulated climate, the importance of these officials cannot be overstated.
Defining Compliance Officers
The Malta Financial Services Authority (MFSA) defines a compliance officer as an individual responsible for ensuring that their entity complies with all applicable laws and rules. However, this role is not only demanding due to the weight of responsibility but also because of the possibility of personal liability, including vicarious criminal liability.
Responsibilities of Compliance Officers
Compliance officers must be aware of the high standards expected by the MFSA, which include:
- Ensuring that licensed entities abide by license conditions
- Demonstrating good faith
- Acting in a manner that shows care and concern for clients and the public
- Displaying honesty and integrity
- Acting competently
- Exercising proper day-to-day supervision over the activities of the licensed entity
Meeting Obligations
To meet their obligations, compliance officers must:
- Have a deep knowledge of all applicable laws, rules, regulations, and guidance issued by the MFSA
- Ensure that staff are aware of and familiar with relevant laws and regulations
- Establish robust policies and procedures to identify and minimize the risk of non-compliance
Reporting Breaches
In the event of wrongdoing, compliance officers are expected to:
- Inform those concerned
- Inform the board of directors
- Inform the MFSA
- Record breaches in writing
- Take action to prevent them from occurring again
Beyond Regulatory Compliance
The role of a compliance officer is not limited to ensuring regulatory compliance; they must also strive to engender a corporate culture of committed compliance rather than creative compliance or game-playing. This requires:
- Effective leadership skills
- Building trust
- Adopting a proactive approach to compliance
- Promoting discussions on ethics and morality
Technology’s Role in Compliance
Technology plays a crucial role in the work of compliance officers, offering both opportunities for automating cumbersome processes and risks of cyber attacks that can cause widespread damage.
Conclusion
Ultimately, compliance officers are powerful agents of informal social control and key players in industry self-regulation, whose role transcends traditional corporate compliance.