Financial Crime World

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Malta’s Financial Regulatory Bodies Crack Down on Money Laundering

The Maltese authorities are stepping up their efforts to combat money laundering and terrorist financing, with a focus on investigating cases and referring them to the relevant authorities.

According to Maltese law, financial institutions and other “subject persons” must demonstrate evidence of the conversion or transfer of property, along with suspicion or knowledge that it has been derived from criminal activity. Concealing the source or origin of property can also lead to legal action.

Consequences of Non-Compliance

Even in cases where no conviction has been made for a crime, the proceeds of that incident can still be considered illicit funds. Those found guilty face fines of up to EUR 2.5 million and imprisonment for up to 18 years.

Regulatory Bodies Empowered

The Malta Financial Services Authority (MFSA) and the Malta Gaming Authority (MGA) have also been empowered to revoke licenses and conduct monitoring as necessary.

Who is a “Subject Person”?

Under Maltese law, subject persons are defined as any natural or legal person carrying out financial business or activity. This can include:

  • Notaries
  • Lawyers
  • Real estate agents
  • Accountants
  • Other professionals involved in financial transactions

Know Your Customer (KYC) and Due Diligence

To combat money laundering, Maltese law requires subject persons to conduct due diligence on their clients. This includes:

  • Verifying the client’s identity, legal status, and source of funds
  • Monitoring the relationship over time
  • Evaluating government-issued ID, utility bills, and proof of address, as well as other biometric data

Risk Management

Subject persons are also required to conduct risk management exercises, evaluating transactions that may be:

  • Complex
  • High-value
  • Suspicious in nature

In cases where these characteristics are noted, the subject person must increase monitoring on the client and relationship.

Record-Keeping and Reporting

Under Maltese law and EU regulations, subject persons must keep relevant documentation and information to aid potential investigations by the Financial Intelligence Analysis Unit (FIAU) or police.

BDO Malta’s AML Compliance Services

BDO Malta’s AML compliance team offers a range of services to help clients comply with their obligations. These include:

  • Developing AML frameworks
  • Conducting compliance reviews
  • Creating procedures
  • Staff training
  • Ongoing compliance support

“We understand the importance of effective AML compliance in preventing money laundering and terrorist financing,” said a spokesperson for BDO Malta. “Our experienced team is dedicated to helping our clients meet their regulatory requirements and maintain a robust culture of compliance within their organizations.”

To learn more about BDO Malta’s AML compliance services, contact us today.