Financial Crime World

Malta’s Fight Against Money Laundering Intensifies with New EU Directives

The European Union has taken a significant step in combating money laundering and terrorist financing by introducing new directives that have been transposed into Maltese law. The Prevention of Money Laundering Act sets out the definitions of money laundering and predicate offences, while the Maltese Criminal Code outlines the offence of terrorist financing.

Key Provisions of the EU’s 5th Anti-Money Laundering Directive (5AMLD)

  • Enhances beneficial ownership transparency by requiring publicly available registers for companies, trusts, and other legal arrangements.
  • Strengthens the powers of Financial Intelligence Units across the EU.
  • Enhances the assessment of high-risk third countries and improves safeguards for financial transactions.
  • Limits anonymity related to virtual currencies and wallet providers.
  • Sets up central bank account registries in all member states.
  • Improves cooperation between anti-money laundering supervisors and the European Central Bank.

Key Provisions of the EU’s 6th Anti-Money Laundering Directive (6AMLD)

  • Eliminates potential loopholes within domestic legislation by harmonizing the definition of money laundering and ensuing penalties across the EU.
  • Brings cybercrime into scope, listing it as a predicate offence for money laundering and extending criminal liability to legal persons.

Implementing Procedures in Malta

In Malta, subject persons, including:

  • Company service providers
  • Gaming licensees
  • Real estate agents
  • Notaries and legal professionals
  • Insurance agents and intermediaries
  • Financial institutions

are required to implement a risk-based approach to combat money laundering. This includes:

  • Obtaining customer information and documentation that is proportionate to the inherent risks.
  • Reporting suspicious transactions.
  • Training staff.
  • Raising awareness.

The FIAU has issued general and sector-specific implementing procedures that are binding on subject persons, outlining their obligations and procedures for preventing money laundering and financing of terrorism. The Maltese government has taken a proactive approach in combating these crimes, with the aim of protecting the country’s financial system and reputation.