The MFSA’s Financial Supervisors Academy webinar titled 'Financial Crime Compliance: A Global Outlook' showcased Malta’s approach to dedicating specific resources aimed at combatting the adverse effects of financial crime – the way it undermines financial systems, hinders economic growth, and negatively affects legitimate businesses and innocent people.

The event, which was attended by over 500 delegates, discussed Malta’s action plan and measures in comparison with other jurisdictions, by bringing together several perspectives from a number of domestic and foreign authorities and institutions, namely the FIAU, the Sanctions Monitoring Board, the Malta Police Force, the Bank of Italy, and the National Coordinating Committee for AML/CFT.

NewsHub brings you seven highlights from the panel discussions and keynote speeches which were held and delivered during the webinar, as listed below:

1. Typologies of financial crimes are often linked, with cases exhibiting multiple financial crimes being committed to achieve financial gain. Similarly, and in response to this, Authorities’ operations and approaches must also be linked. Effective cooperation and intelligence sharing between different national competent authorities is a key enabler to prompting decisive action, based on a complete and accurate set of information.
2. Close collaboration also translates into shared technical expertise and the creation of a holistic risk understanding through pooling of data and information. This is especially important in the updating of the National Risk Assessment for Malta. This update is a commitment which Malta has made in its 2021-2023 National anti-money laundering, counter-terrorism financing and targeted financial sanctions Strategy and Action Plan.
3. The MFSA acts as the primary gatekeeper of Malta’s financial system. This is achieved through thorough screening which ensures probity and keeps the sector clean, as well as through educating consumers and firms.
4. Company service providers act as gatekeepers to Malta’s financial services and play a crucial role in protecting the integrity of the financial system and the broader economy from undesired and illegal activity due to the various risks which they face when carrying out their business. These risks range from complex structures of applicants, possibility of sanctions evasions and the existence of shell companies.
5. Fighting financial crime cannot be exclusive to the authorities. Financial services companies and their staff are paramount to the success of these efforts as they need to ensure their senior leadership’s commitment and that staff have the right knowledge and expertise. Moreover, they need to have in place a sound framework for risk assessment and risk-based internal controls, and independent testing and auditing.
6. Good corporate governance practices are the foundation of any financial crime compliance programme and MFSA’s updated Corporate Governance Code published earlier this year, specifically its principles related to financial crime compliance, are especially relevant. The Code now considers financial crime related aspects, such as that the Board should fully appreciate the business risks, including those relating to financial crime, and that entities should ensure that their MLROs and financial crime compliance managers hold sufficient knowledge, skills, and experience.
7. Internal Audit plays a pivotal role in the effectiveness of an organisation’s financial crime risk management framework. Perceiving the internal auditor as a facilitator rather than an inhibitor is the first step to encouraging openness to improvements and a commitment towards compliance within companies.