Malta v Moneyval
In a report the Council of Europe’s anti-money laundering body MONEYVAL calls on the Maltese authorities to strengthen their practical application of their measures to combat money laundering and financing of terrorism.
The Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL) is a 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. The report makes a comprehensive assessment of the effectiveness of Malta’s anti money laundering and countering the financing of terrorism system and its level of compliance with the Recommendations by the Financial Action Task Force (FATF).
“MONEYVAL acknowledges that the authorities have demonstrated a broad understanding of the vulnerabilities within the system, but a number of important factors – notably predicate offences, financing of terrorism, legal persons and arrangements, the development of new technologies and the use of cash – appear to be insufficiently analysed or understood,” the Council of Europe said.
While the Financial Intelligence Analysis Unit is considered to be an important source of financial intelligence for the Maltese police, only in a limited number of cases are the disseminations used to develop evidence and trace criminal proceeds related to money laundering and terrorism financing. The report considers that money laundering is mainly investigated together with the predicate offence on which the investigation is centred. But limited resources, both human and financial, weigh negatively on Malta’s capability to effectively pursue this offence. Investigations and prosecutions do not appear to be in line with the country’s risk profile. The report expresses concerns that the law enforcement authorities are currently not in a position to effectively and in a timely manner pursue high-level and complex money laundering cases related to financial, bribery and corruption offences. Fundamental improvements are also needed with regard to the confiscation of proceeds of crime from money laundering and associated predicate offences.
While Malta has a sound legal framework to fight the financing of terrorism, the report notes that few investigations have been conducted so far which have not resulted in any prosecutions or convictions. While noting recent progress, the report concludes that the actions undertaken by the authorities are not fully in line with the country’s exposure to possible terrorism financing risks. Malta does ensure the implementation of the United Nations targeted financial sanctions regimes on terrorist financing and the financing of proliferation of weapons of mass destruction without delay. But authorities have been told to demonstrate a competency in co-ordinating their activities with respect to implementation of various targeted financial sanctions’ regimes.
MONEYVAL noted that supervisory authorities do not have adequate resources to conduct risk-based supervision, for the size, complexity and risk profile of the country’s private sector.