During its last plenary session, held on the 23rd June 2021, the Financial Action Task Force (“FATF”) voted to insert Malta in its list of countries that have been identified as having strategic anti-money laundering (“AML”) deficiencies, the so called grey list. This puts Malta under increased monitoring and binds its government to work with the FATF in order to implement, within an established timeframe, an action plan to address the specific remaining deficiencies.
The FATF decision was adopted despite the outcome report of the assessment made by the Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism, commonly known as MONEYVAL, earlier this year, where it was reported that Malta has demonstrated “significant progress” in fighting money-laundering and terrorism financing.
The FATF recognised that, since the adoption of its last Mutual Evaluation Report (“MER”), in July 2019, Malta has made progress on a number of recommended actions to improve its AML framework. However, the FATF deemed that three (3) recommended actions, out of fifty-eight (58) listed in the 2019 MER, are not sufficiently addressed by Malta. The three recommendations for which the FATF decided to put Malta under increased monitoring are as follow:
- continuing to demonstrate that beneficial ownership information is accurate and that, where appropriate, effective, proportionate, and dissuasive sanctions, commensurate with the ML/TF risks, are applied to legal persons if information provided is found to be inaccurate; and ensuring that effective, proportionate, and dissuasive sanctions are applied to gatekeepers when they do not comply with their obligations to obtain accurate and up-to-date beneficial ownership information;
- enhancing the use of the financial intelligence unit (“FIU”) to support authorities pursuing criminal tax and related money laundering cases, including by clarifying the roles and responsibilities of the Commissioner for Revenue and the FIU; and
- increasing the focus of the FIU’s analysis on these types of offences, to produce intelligence that helps Maltese law enforcement detect and investigate cases in line with Malta’s identified ML risks related to tax evasion.
On a comment to the FATF vote, the Maltese Prime Minister declared that Malta “will take this message seriously and show everyone that we are an EU member state that is committed to good governance and fighting financial crime and terrorism funding”, and that the government will work hard to ensure that Malta is removed from the greylist as soon as possible and expressed confidence that Malta will emerge from the FATF’s grey list as a more effective and attractive jurisdiction.
The authorities in Malta also are doing their best to address the outstanding recommendations and are hopeful to get Malta out of the grey list within the year.