The FIAU has published a Factsheet regarding Typologies, Red Flags and Indicators of Tax-Related Money Laundering. Featuring as one of the focal points that Malta must focus on as a jurisdiction even following our FATF assessment, tax-related money laundering is an area subject persons need to be especially attentive towards. Tax evasion is intimately tied to money laundering. Moreover, tax evasion in itself is a crime and therefore attempts to legitimize its resulting proceeds is in itself an act of money laundering.
The document published by the FIAU follows on the face-to-face training held by the same regulator earlier this November. The document includes a number of practical case studies and is built upon the FIAU’s analysis of actual Suspicious Transaction Reports (STRs) having had tax offences indicated as the predicate offence.
The FIAU outlines five pillars to evaluate as red flags:
- Customer’s Identification Information
- Customer Interaction & Behaviour
- Entity Structure & Governance
- Source of Wealth & Source of Funds
- Unusual or Suspicious Transactions
The FIAU elaborates that the presence of red flags from these elements should lead a subject person to inquire further, especially where more than one of these red flags is present, and thus consider whether a suspicion there exists. The document may be accessed through this link: https://fiaumalta.org/wp-content/uploads/2021/11/FIAU-Factsheet-Typologies-Red-Flags-Indicators-of-Tax-Related-ML.pdf