Malta’s Banks Tackle Money Laundering with Strict Procedures

Malta’s banking sector has implemented strict measures to prevent money laundering and the financing of terrorism. The country’s financial regulatory authority, the Financial Intelligence Analysis Unit (FIAU), has set guidelines for banks to follow in order to ensure compliance.

Preventing Money Laundering

According to the Prevention of Money Laundering and Financing of Terrorism Guidance Notes issued by the Institute of Financial Services Practitioners, banks must:

• Carry out customer due diligence procedures to identify their clients and verify their identities
  • Obtain information about the client’s purpose and nature of business
  • Identify the ultimate beneficial owner
• Establish a risk-based approach to prevent employees from carrying out operations that may be related to money laundering
• Keep records of transactions and customer information for at least five years in case of an investigation

Appointing a Money Laundering Reporting Officer (MLRO)

Banks must appoint an MLRO who will act as the contact point for reporting suspicious activities. The MLRO is responsible for deciding whether a report gives rise to knowledge or suspicion that another person is engaged in money laundering or the funding of terrorism.

Awareness and Training Programs

Malta’s banks have implemented awareness and training programs for employees, which aim to ensure that they are able to recognize and handle transactions carried out by individuals who may be involved in money laundering.

Cooperation with Regulatory Authority

The FIAU has emphasized the importance of cooperation between banks and the regulatory authority in combating financial crimes. Banks must report any suspicious activity to the FIAU within five working days of when the suspicion first arose.

“The fight against money laundering and the financing of terrorism requires a collaborative effort between all stakeholders, including banks, regulatory authorities, and law enforcement agencies.” - FIAU

Progress and Future Plans

Malta’s banking sector has made significant progress in implementing anti-money laundering measures. However, there is still much work to be done. The country’s financial regulators are committed to ensuring that the industry continues to evolve and improve its practices.

As a result of these efforts, Malta’s banks have become more vigilant in identifying and reporting suspicious transactions, which has led to a decrease in the number of money laundering cases reported.

Conclusion

Malta’s banking sector is taking proactive steps to prevent money laundering and the financing of terrorism. The country’s regulatory authority, the FIAU, will continue to monitor and guide banks in their efforts to ensure compliance with anti-money laundering regulations.