MALTA: Financial Crime Prevention Techniques Crucial in Preventing Sanctions Breaches
Malta’s financial sector has a critical role to play in preventing breaches of international sanctions, which are primarily issued by the United Nations Security Council and the European Union. These sanctions aim to punish rogue regimes, terrorist organizations, and individuals who engage in illegal activities.
The Role of the Sanctions Monitoring Board
To achieve this goal, the National Interest (Enabling Powers) Act empowers the Sanctions Monitoring Board to monitor the implementation and operation of sanctions legislation in Malta. The Board is responsible for proposing designations, delistings, unfreezing of property, and other measures to ensure compliance with international sanctions.
Financial Sanctions: A Key Component
Financial sanctions are particularly crucial, as they target specific individuals, companies, and entities involved in illegal activities. These sanctions impose restrictions on the movement of funds, financial assets, and economic resources, making it difficult for sanctioned individuals and entities to engage in illegal activities.
Compliance Obligations for MFSA Licence Holders
MFSA Licence Holders have a legal obligation to comply with international sanctions and take all necessary steps to implement them immediately. They must:
- Monitor their business relationships
- Verify records on an ongoing basis
- Identify and freeze any funds, financial assets, or economic resources connected to designated individuals and entities
Resources for Compliance
To facilitate compliance, the MFSA provides information on international sanctions through its website. Licence Holders are urged to consult the Sanctions Monitoring Board’s website for complete and up-to-date information and seek professional advice as necessary.
Collaboration with Other Authorities
The MFSA is also working closely with other authorities to ensure that Malta remains compliant with international sanctions. For instance, it has informed all Credit Institutions about reporting requirements related to Council Regulations (EU) No 267/2012 (Iran), 208/2014 (Ukraine), 101/2011 (Tunisia), and 270/2011 (Egypt).
US Sanctions: A Critical Consideration
Furthermore, the MFSA is advising Licence Holders and the public to take US sanctions into consideration when conducting business activities. The US Treasury Department’s Office of Foreign Assets Control (OFAC) imposes significant financial provisions on foreign persons or entities that violate US sanctions laws and regulations.
Conclusion
In conclusion, Malta’s financial sector plays a vital role in preventing breaches of international sanctions. By implementing effective financial crime prevention techniques, Licence Holders can ensure compliance with international sanctions and avoid unwittingly supporting illegal activities.