Financial Crime World

Malta Boosts Anti-Money Laundering Laws to Combat Financial Crimes

The European Union’s efforts to combat financial crimes have put Malta under the spotlight as the island nation seeks to strengthen its anti-money laundering (AML) and combating the funding of terrorism (CFT) laws. In a bid to prevent the misuse of its financial system, Malta has been implementing new regulations to tackle money laundering and terrorist financing.

National Risk Assessment

According to Malta’s National Risk Assessment, illegal activities such as drug trafficking, tax evasion, and criminal groups are the main sources of proceeds generated in Malta. The assessment also identified sectors like banking and corporate service providers as being at a higher risk of money laundering and terrorist financing.

Implementation of New Regulations

Malta has already transposed the 4th Anti-Money Laundering Directive into national law and is currently working on implementing the changes introduced by the 5th Anti-Money Laundering Directive. The EU Commission’s recent package of legislative proposals aims to further strengthen AML/CFT rules in the EU, including the establishment of an EU AML Authority to coordinate national authorities.

Consequences of Non-Compliance

Failure to maintain effective AML/CFT systems can have severe consequences, including reputational damage, regulatory intervention, and substantial monetary penalties. An organisation’s AML/CFT controls can be easily undermined by a poor culture of compliance, making it crucial for management to buy-in and involve themselves in the process.

Expertise from KPMG

KPMG, an international consulting firm, has extensive experience in helping subject persons develop strong AML/CFT frameworks that meet compliance objectives while also providing a competitive edge. The company’s team is focused on delivering robust, real-world solutions based on their expertise in Malta and internationally.

Prioritizing AML Culture and Controls

With the EU Commission’s proposed changes set to take effect by 2024, organisations operating in Malta are advised to prioritize developing a strong AML culture and implementing effective controls to mitigate ML/TF risks. By doing so, they can ensure compliance with the regulator’s expectations while also protecting their reputation and financial stability.

Key Takeaways

  • Malta is strengthening its anti-money laundering (AML) and combating the funding of terrorism (CFT) laws.
  • The country has transposed the 4th Anti-Money Laundering Directive into national law and is working on implementing the changes introduced by the 5th Anti-Money Laundering Directive.
  • Organisations operating in Malta are advised to prioritize developing a strong AML culture and implementing effective controls to mitigate ML/TF risks.
  • Failure to maintain effective AML/CFT systems can have severe consequences, including reputational damage, regulatory intervention, and substantial monetary penalties.