Financial Crime World

Malta’s Central Bank Enhances Compliance Procedures

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The Central Bank of Malta has taken significant steps to strengthen its regulatory compliance function by entrusting it to its in-house Legal Department. This move aims to enhance the Bank’s pursuit of statutory tasks and objectives through proper observance of compliance policies.

Enhanced Regulatory Compliance Function

As of October 2016, the Bank’s Legal Department took over the responsibility for its regulatory compliance function. Under the guidance of the Legal Department, the Bank’s lawyers provide legal advice on diverse matters, including:

  • Governance Structure: The Bank’s lawyers advise on governance-related issues to ensure effective management and oversight.
  • Contractual Issues: They provide expert advice on contractual matters related to financial services.
  • Legislative Processes: The Legal Department advises the Bank on legislative processes and developments affecting the financial services sector.

European Central Bank (ECB) Involvement

The Bank’s lawyers participate in various ECB committees and sub-committees, including:

  • LEGCO: A platform for European lawyers from national central banks to discuss legal matters related to core Eurosystem areas.
  • Financial Law Experts Group: A committee focused on providing legal support and advice for ECB statutory tasks.
  • Ethics Framework Task Force: A task force dedicated to developing an ethics framework for the Bank.

Committee Involvement

The Bank’s lawyers also sit on various committees, including:

  • Management Committee: The highest decision-making body of the Bank, responsible for setting overall strategy and policy.
  • Risk Committee: Responsible for overseeing risk management and ensuring that risks are identified and mitigated.
  • ESCB Committee: A committee focused on European System of Central Banks (ESCB) issues and coordination.

Secretariat to the Executive Committee

In 2018, the Legal Department took over as secretariat to the Executive Committee. This move reflects the Bank’s commitment to effective governance and compliance procedures. The Legal Department provides expert advice to the Board and Governors in fulfilling their responsibilities under the law.