This note was prepared by Chady El-Khoury and Maksym Markevych (IMF’s Legal Department). It reflects the findings and discussions during the September 2018 FSAP mission to Malta.
The FAT F-sty le region al body of which Malta is a member.
Effectiveness of Maltese AML/CFT supervision, ML investigation and prosecution, and confiscation were rated as low. Effectiveness of six other immediate outcomes were rated as moderate and two as substantial. Legal provisions relevant to 9 FATF Recommendations were rated as partially compliant, the rest of legal framework is largely compliant or compliant with respect to FATF Recommendations. The effectiveness ratings received by Malta may lead to a closer scrutiny by the FATF under the process of identification and review of jurisdictions with strategic AML/CFT deficiencies.
Results of the NRA are now publicly available.
Malta’s IIP was introduced in 2014. It is a citizenship-by-investment program that allows individuals to acquire citizenship in exchange for major investments in the Maltese economy.
See IMF, 2018, Euro Area—Financial System Stability Assessment. The 2018 Euro Area FSSA recommended that, in addition to ongoing efforts to strengthen AML/CFT supervision at the national levels and improve information sharing among domestic AML/CFT supervisors, consideration should be given over the longer term to establishing an EU-level institution directly responsible for AML/CFT supervision.
The Registry of Companies (ROC) was renamed Malta Business Registry (MBR) in 2019.
Under current FSAP policy, every FSAP should incorporate timely and accurate input on AML/CFT. Where possible, this input should be based on a comprehensive AML/CFT assessment conducted against the prevailing standard. In instances where a comprehensive assessment against the prevailing standard is not available at the time of the FSAP, staff may derive key findings on the basis of other sources of information, including already available information or information obtained in the context of the FSAP. See the Acting Chair’s Summing Up—Review of the Fund’s Strategy on Anti-Money Laundering and Com bating the Financing of Terrorism —Executive Board Meeting 14/22, March 12, 2014, BUFF/14/23.
The FATF-style regional body of which Malta is a member.
Results of the NRA were communicated to private sector and key authorities following the FSAP team visit.
Moreover, the NRA did not rely on: typology studies and strategic analysis conducted by the FIAU, data on CBRs, transportation of cash, or financial soundness data. Furthermore, it did not properly identify the vulnerabilities of products and clients faced by banks.
Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of ML or TF.
The NRA was conducted before the gaming companies became AML/CFT reporting entities.
EU passport could be issued for the equivalent of a contribution of €650 000, other fees, purchase, or rental of high-end real estate and other investments in Malta.
Malta Individual Investor Program Agency reported that only 77 percent of applicants are approved and considers this approval rate to be an indicator of effectiveness of IIP controls.
Following the FSAP team on-site visit in September 2018, the Memorandum of Understanding between the FIAU and MFSA was upgraded and the joint supervisory procedures were adopted.
The FIAU is an independent government agency established in terms of Article 15 of the Prevention of Money Laundering Act (PMLA). The FIAU is the Financial Intelligence Unit in Malta in charge of receiving, analyzing and disseminating financial intelligence related to ML, related predicate crimes, and FT. In addition to its financial intelligence unit functions, the FIAU is in charge of supervising financial institutions and DNFBPs to ensure compliance with the AML/CFT requirements.
Decision taken by FIAU’s Board of Governors based on proposals made by the FIAU’s Compliance Monitoring Committee.
In 2015, a dedicated AML/CFT team was established within the Enforcement Unit of the MFSA, which took over the role of assisting the FIAU in carrying out AML/CFT inspections of the financial services operators regulated by the MFSA, a role which was previously performed by the various supervisory units within the MFSA. This team became operational in 2016 and started carrying out onsite inspections on behalf and jointly with the FIAU.
€40,000 against HSBC, €20,000 against BoV (public information disclosed on the FIAU’s website).
One case for €327,500 and another for €199,500 under appeal. One case for €11,200 and another for €8,000 under consideration by the FIAU compliance monitoring committee.
See IMF, 2018, Euro Area—Financial System Stability Assessment.
Main types are partnership en nom collectif, partnership en commandite or limited partnership, public and private limited liability companies, trusts, foundations, and associations.
Company name, legal status, address of registered office, basic regulating powers, names, addresses and official identification document numbers of all shareholders, partners, directors and company secretaries.
https://registry.mfsa.com.mt/ROC/. Basic information is available online for free, memorandums of association and deeds of partnership are also available online, but for a small fee.
The authorities indicated that the registers of beneficial ownership of companies and trusts that were set up in 2018 potentially are another avenue to source BO information.