The Malta Independent 24 April 2019, Wednesday

TMID Editorial - AML chickens coming home to roost

Thursday, 4 October 2018, 18:21 Last update: about 8 months ago

The fi­nance min­is­ter may com­plain about taxi driv­ers bad­mouthing Malta, the Prime Min­is­ter may say we are be­ing picked on be­cause we are small and other coun­tries are jeal­ous of our suc­cess. But the pure fact of the mat­ter is that the EU’s mi­cro­scope has been trained on Malta for a long time now, and for good rea­son.

Make no mis­take, this sit­u­a­tion is of the govern­ment’s own mak­ing. The govern­ment can­not con­tinue to blame the lo­cal or the for­eign me­dia for stir­ring the hor­nets’ nest.

Make no mis­take, this sit­u­a­tion is of the govern­ment’s own mak­ing. The govern­ment can­not con­tinue to blame the lo­cal or the for­eign me­dia for stir­ring the hor­nets’ nest.

Fi­nance Min­is­ter Ed­ward Sci­cluna yes­ter­day took ex­cep­tion to a re­port in an es­teemed for­eign news­pa­per that re­ported how the Euro­pean Com­mis­sion is set to take fur­ther ac­tion against Malta over its lax anti-money laun­der­ing laws.

Mat­ters have clearly come to a head. Over two months ago the Com­mis­sion had given Malta a two-month dead­line to fully trans­pose the Euro­pean Union’s 4th Anti-Money Laun­der­ing Direc­tive into na­tional law, short of which it will be hauled be­fore the Euro­pean Court of Jus­tice over the mat­ter.

Mat­ters have clearly come to a head. Over two months ago the Com­mis­sion had given Malta a two-month dead­line to fully trans­pose the Euro­pean Union’s 4th Anti-Money Laun­der­ing Direc­tive into na­tional law, short of which it will be hauled be­fore the Euro­pean Court of Jus­tice over the mat­ter.

That came af­ter the Com­mis­sion sent a sec­ond rea­soned opin­ion to Malta over the breach, al­though the govern­ment had claimed it had fully im­ple­mented the law, at the 11th hour,

Back in De­cem­ber. The Com­mis­sion, how­ever, had found Malta’s trans­po­si­tion to have been in­com­plete, de­spite the govern­ment’s ‘mis­sion ac­com­plished’ self-con­grat­u­la­tory at the end of last De­cem­ber.

What can be in­ferred from the ar­ti­cle is that Malta’s replies to the Com­mis­sion were so un­sat­is­fac­tory that the Com­mis­sion is go­ing over and above its op­tion to haul the coun­try be­fore the Euro­pean Courts of Jus­tice over the mat­ter.

Malta has been on the re­ceiv­ing end of a lot of crit­i­cism from EU quar­ters of late af­ter the Euro­pean Bank­ing Author­ity took Malta’s Fi­nan­cial In­tel­li­gence Anal­y­sis Unit to task over its su­per­vi­sion of Pi­la­tus Bank, and with Euro­pean Com­mis­sioner for Jus­tice Věra Jourová hav­ing time and time again flagged con­cern over gaps in Malta’s anti-money laun­der­ing laws.

Malta has been on the re­ceiv­ing end of a lot of crit­i­cism from EU quar­ters of late af­ter the Euro­pean Bank­ing Author­ity took Malta’s Fi­nan­cial In­tel­li­gence Anal­y­sis Unit to task over its su­per­vi­sion of Pi­la­tus Bank, and with Euro­pean Com­mis­sioner for Jus­tice Věra Jourová hav­ing time and time again flagged con­cern over gaps in Malta’s anti-money laun­der­ing laws.

It is Europe’s be­lief that anti-money laun­der­ing rules are cru­cial in the fight against money laun­der­ing and ter­ror­ism fi­nanc­ing, and that the Panama Pa­pers and other scan­dals have re­vealed the need for stricter anti-money laun­der­ing rules in Malta and across the bloc.

Gaps in one mem­ber state, af­ter all, have an im­pact on all oth­ers, which is why holis­tic, ef­fec­tive ac­tion against money laun­der­ing is one of the cen­tral points of the EU’s ap­proach to com­bat­ing crime in Europe.

Malta has pledged to co­op­er­ate, and said that its le­gal teams will en­gage in tech­ni­cal dis­cus­sions with the Com­mis­sion’s le­gal team to ex­plain the rea­sons and jus­ti­fi­ca­tion of Malta’s leg­is­la­tion and make the cor­rec­tions that might be re­quired.

Those dis­cus­sions, judg­ing from the Com­mis­sioner’s com­ments, did not go down all that well, and ad­di­tional ac­tion is to be taken. Has the Com­mis­sion taken an un­healthy and dis­pro­por­tion­ate line against Malta? We think not.

Those dis­cus­sions, judg­ing from the Com­mis­sioner’s com­ments, did not go down all that well, and ad­di­tional ac­tion is to be taken. Has the Com­mis­sion taken an un­healthy and dis­pro­por­tion­ate line against Malta? We think not.

The plain fact of the mat­ter is that Europe sim­ply can­not af­ford to let any sin­gle state coun­try be the weak­est link – money laun­dered in one coun­try can and of­ten will sup­port crime in an­other coun­try.

And Malta can no longer be con­sid­ered to be one of those weak links: too many jobs and too much of our econ­omy de­pends on our fi­nan­cial ser­vices sec­tor, and we can ill-af­ford any more blows.

We need to clean up our act here in Malta, and, in a wider con­text, across the whole of the EU, be­fore it is too late and trust is lost for good.

 

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