MONEYVAL notes significant improvement in Malta’s AML controls

Malta was re-rated from ‘partially compliant’ to ‘largely compliant’ and ‘compliant’ in respect of nine Financial Action Task Force (FATF) Recommendations to improve measures to combat money laundering and terrorist financing (ML/TF), according to a follow-up report published on 27 May by the EU Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism, known as MONEYVAL)

As a result of its previous assessment in 2019, Malta was requested to report to MONEYVAL under the enhanced follow-up procedure. Deficiencies with technical compliance were identified with respect to application of some of its preventative measures, transparency of legal entities, supervision and international co-operation.

MONEYVAL said it had now examined a range of legislative, regulatory and institutional measures implemented by Malta to address these deficiencies and the positive steps taken by the authorities had prompted it to assign Malta higher international compliance ratings in these areas.

The follow-up report also covered implementation of new international requirements for virtual assets, which includes the most prominent virtual currencies and the providers of these assets. Malta was one of the first MONEYVAL countries to implement the regulatory and institutional framework and conduct ML/TF risk assessments in this area. Malta’s rating on the implementation of this Recommendation has also been upgraded from ‘partially compliant’ to ‘largely compliant.

As a result, MONEYVAL said, Malta had met the general expectation for countries to have addressed most, if not all, of the technical compliance deficiencies after the adoption of the mutual evaluation report, within a two-year period. It has now achieved full compliance with 12 of the 40 FATF Recommendations and retained only minor deficiencies in the implementation of the remaining 28 Recommendations. As a result, Malta is now rated ‘largely compliant’ in all these areas, rather than ‘partially compliant’ or ‘non-compliant’.

“The strengthening of the regulatory regime in Malta is a positive move and will help to further improve its reputation as a centre for business and foreign direct investment,” said Managing Director of Sovereign Trust (Malta) Stephen Griffiths.

“Malta has long been a jurisdiction of choice because of its EU membership, central Mediterranean location, English-speaking workforce and robust legislative and regulatory systems. The regulatory environment continues to develop. Sovereign welcomes this and stands ready to assist start-ups, entrepreneurs and established businesses to successfully navigate this ever changing and fast evolving jurisdiction.”

The MONEYVAL follow-up report assesses legislative, regulatory and institutional reforms but does not assess the degree to which the implemented reforms have been effectively implemented. MONEYVAL said Malta would therefore remain in enhanced follow-up and would report back to MONEYVAL on further progress to strengthen its implementation of AML/CFT measures in two years.

MONEYVAL is a permanent monitoring body of the Council of Europe entrusted with the task of assessing compliance with the principal international standards to counter money laundering and the financing of terrorism and the effectiveness of their implementation, as well as with the task of making recommendations to national authorities in respect of necessary improvements to their systems.