As the June plenary of the Financial Action Task Force approaches, there is reason to be optimistic that the country will join Iceland in exiting the grey list in record time, according to the Financial Intelligence Analysis Unit’s leadership.

Speaking with Jo Caruana during Tuesday’s episode of The Boardroom, Head of Strategy, Policy and Quality Assurance Alexander Mangion, Head of Supervision Claudia Callus, and Head of Intelligence Analysis Ruth Aisthorpe Gauci explained that the groundwork laid in the years preceding Malta’s greylisting in June 2021 played a big role in ensuring that both public authorities and private businesses were able to move swiftly.

Mr Mangion pointed out that the jurisdiction’s technical compliance is among the best in the world, with no negative ratings whatsoever.

“It was in the effectiveness assessment that we were found lacking in three areas. Thankfully, Government and other stakeholders acted decisively, convening a national coordinating committee and drawing up an action plan to guide efforts,” he said.

This action plan included two assessments, one into compliance by legal persons, conducted by the Malta Business Registry, and another into compliance by Corporate Service Providers, conducted by the FIAU.

“The vast majority were found to be doing a great job in adhering to their obligations, with no further cause for concern,” explains Ms Callus. “Others were asked to undertake remedial actions, and some cases warranted more serious enforcement measures, like fines.”

One key takeaway from these assessments, he continued, was the total absence of systemic breaches. “The results showed that the risk was not as high as previously envisaged. So we were very happy to see this.”

“What these efforts tried to achieve was an increase in the use of financial intelligence across the board,” says Ms Aisthorpe Gauci. “Their successful outcome was exactly what the FATF was hoping that we would achieve.”

All this led to a site visit by FATF assessors last month, in what is considered record time.

“Site visits only take place when the evaluators are convinced that the jurisdiction has done what is required of it, so the fact it took place is a very positive indication,” says Mr Mangion. “Their job here was to ensure that the reforms are taking place, that they are sustainable, and that they enjoy political backing.”

“Ultimately,” he continues, “such assessments are also important because they bring particular attention to the jurisdiction’s anti-money laundering and countering financing of terrorism framework. They are a good opportunity for the country to step up and show that it has an effective regime in place.”

The assessors will now report to the FATF committee, who could take a decision as early as June to strike Malta off the grey list. Should it find reason to believe that Malta requires more time to implement further reforms, the next opportunity will come in October.

Regardless of the outcome, the FIAU will continue working hard to produce good quality work.

Ms Callus stresses that Malta’s action plan was never a box-ticking exercise, with Ms Aisthorpe Gauci highlights the positives emanating from the exercise, including unprecedented investment in new talent and systems that will serve the country for years to come.

Mr Mangion sums up the FIAU’s approach: “The upgrades we have effected thanks to these reforms ensure that we will not go back to the previous situation. The level of effectiveness we now enjoy in the fight against financial crime is our new normal.”

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Written By

Robert Fenech

Robert is curious about the connections that make the world work, and takes a particular interest in the confluence of economy, environment and justice. He can also be found moonlighting as a butler for his big black cat.