Financial Crime World

Banks’ Responsibilities in Preventing Financial Crime in Malta Take Center Stage Ahead of Moneyval Report Publication

As the Maltese Financial Services Authority (MFSA) prepares to publish the latest report from the Council of Europe’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and Combating the Financing of Terrorism (Moneyval), a significant overhaul of its anti-money laundering (AML) standards and procedures has been underway. The MFSA has consulted extensively with local and international institutions, incorporating specific recommendations listed in the Moneyval report into its changes.

Recent Initiatives to Strengthen AML/CFT Supervision

In the past year, several initiatives have been undertaken to strengthen AML/CFT supervision:

  • Setup of a dedicated Financial Crime Compliance function
  • Enhanced collaboration with the Malta Financial Intelligence Analysis Unit (FIAU)
  • Reform of authorisation procedures
  • More rigorous due diligence procedures
  • Introduction of a Register of Beneficial Owners of Trusts

Positive Results from MFSA’s Efforts

The MFSA’s efforts have already borne fruit, with a notable increase in the number of inspections carried out. In 2018, the Authority refused 25% of licence applications, up from 7% in 2017, as it set higher due diligence expectations for applicants.

Future Plans to Combat Financial Crime

Looking ahead, the MFSA is planning to:

  • Strengthen collaborations with internal institutional bodies and foreign regulators
  • Invest in technology and human resources to better combat increasingly sophisticated money laundering schemes
  • Publish a consultation document outlining proposed standards for company service providers (CSPs)
  • Formulate a Risk Appetite Statement that defines the level of risk it is willing to accept

Maintaining Malta’s Reputation as a Financial Hub

As Malta seeks to maintain its reputation as a financial hub, the MFSA’s efforts to prevent financial crime are crucial in ensuring the stability and integrity of the country’s banking system. With these initiatives underway, the Authority is well-positioned to meet the challenges posed by money laundering and terrorist financing.