First AML Regulation and AML Directive Update agreement reached:
The Council and Parliament have reached a tentative consensus on elements of the anti-money laundering package. The deal needs to be formally adopted by Parliament and Council before it can come into force.
The provisional agreement on an anti-money laundering regulation will comprehensively standardize rules across the EU, addressing potential loopholes exploited by criminals for laundering illegal proceeds or funding terrorist activities via the financial system, marking the first instance of such harmonization.
- The agreement will cover new rules applicable to most of the crypto sector. Due diligence measures will need to be carried out for transactions amounting to €1000 or more.
- Traders of luxury goods such as precious metals, precious stones, jewellers, horologists, goldsmiths, traders of luxury cars, airplanes, and yachts, as well as cultural goods like artworks, will become Subject Persons/ obliged entities
- The introduction of specific EDD measures for cross-border correspondent relationships for crypto-asset service providers
- EU-wide maximum limit of €10000 cash is set for cash payments. Subject persons obliged will need to identify and verify the identity of a person who carries out an occasional transaction in cash between €3.000 and €10.000.
- Beneficial ownership threshold is set to 25%. Rules pertaining to complex ownership and control structures are further elucidated to prevent individuals from concealing their involvement through intricate layers of company ownership. The agreement specifies that this will include non-EU entities engaging in business activities within the EU or acquiring real estate in the EU.
- Simultaneously, provisions regarding data protection and record retention are clarified, aiming to facilitate the work of competent authorities by streamlining processes and expediting their efforts.
- Additional levels of risk will trigger specific EU or national countermeasures for high-risk third countries.
- To streamline inquiries into criminal schemes related to real estate, the regulation allows access for competent authorities to access real estate registers through a unified access point. This allows the retrieval of information such as property price, type, history, and various encumbrances like mortgages, judicial restrictions, and property rights.
Malta’s National Risk Assessment (NRA) for 2023:
Malta has officially published its National Risk Assessment (NRA) for 2023, providing a thorough examination of the country’s susceptibility to risks related to:
- money laundering,
- terrorist financing,
- proliferation financing, and
- targeted financial sanctions
Subject persons should review the document and pinpoint MLFT threats that are applicable to their business and include the alignment of both the Business Risk Assessment and the Customer Risk Assessment with the findings of the NRA. This is essential for developing a robust comprehension of risks, ultimately strengthening the risk-based approach which include the regular update of the customer risk profiles.
To access the National Risk Assessment, kindly click on the following link:
https://www.ncc.gov.mt/wp-content/uploads/2024/01/PublicNRA_Dec2023.pdf
Enforcement Factsheet: A Compilation of Regulatory Actions – 2021/2022
On the 15th January 2024, FIAU Enforcement Factsheet: A Compilation of Regulatory Actions – 2021/2022.
The FIAU issued an Enforcement Factsheet outlining the most serious and material breaches identified during examinations held by the FIAU between 2021 and 2022. The factsheet which includes case studies of the findings, red flags that SPs should look out for, including control frameworks that should be in place, provides additional guidance to SPs on performing their obligations concerning the effective implementation of mitigants with emphasis on the following areas:
- intended nature of the business relationship,
- enhanced due diligence (EDD),
- transaction monitoring,
- reporting, and
- breaches relating to beneficial ownership (including identification and verification and reporting).
In addition to providing an overview of the most common breaches identified by the FIAU, the document also provides an overview of the FIAU’s enforcement process.
https://fiaumalta.org/wp-content/uploads/2024/01/Enforcement-Factsheet-A-Compilation-of-Regulatory-Actions-20212022.pdf
