Financial Crime World

Malta Financial Crimes: Understanding Sanctions and Restrictive Measures

Malta has implemented various international sanctions to restrict trade, finance, and travel with certain countries, individuals, and entities. These measures are designed to promote peace, stability, and security globally, while also combating terrorism and organized crime.

According to the National Interest (Enabling Powers) Act, United Nations Security Council resolutions imposing sanctions are directly applicable in Malta, as are European Union Council and Commission regulations concerning restrictive measures. The Sanctions Monitoring Board is responsible for monitoring the implementation of these sanctions and provides information on international sanctions through its website.

Financial Sanctions

Financial sanctions, which target specific individuals and entities, impose a duty to freeze assets and transactions related to designated parties. MFSA Licence Holders, including banks and financial institutions, have a legal obligation to comply with these sanctions and report any findings or actions taken to the Sanctions Monitoring Board and the Malta Financial Services Authority (MFSA).

Obligations of Licence Holders

The MFSA requires licence holders to:

  • Take note of all international sanctions issued from time to time
  • Exercise caution when conducting business activities
  • Monitor their business relationships
  • Verify records on an ongoing basis
  • Identify and freeze any funds or assets related to designated individuals or entities

Reporting Requirements

In addition, the MFSA has informed credit institutions about reporting requirements in relation to Council Regulation (EU) No 267/2012 concerning restrictive measures against Iran and other countries. The collation and transmission of this information is coordinated by the Sanctions Monitoring Board.

US Sanctions

US sanctions also apply to certain countries, individuals, and entities, and are enforced through legislation that provides for various types of action, including measures targeting foreign persons or entities. The US Treasury Department’s Office of Foreign Assets Control (OFAC) may impose penalties on non-US banks found to have engaged in prohibited transactions.

Compliance Advice

The MFSA urges licence holders and the public to be aware of and comply with international sanctions, and advises seeking professional advice as necessary to ensure compliance with these measures.