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Going back to Act One of 2020 – How did the Act amend Malta’s Prevention of Money Laundering Act (PMLA)?

Malta’s legislation is in a constant state of flux, with new legal notices, bills and acts being implemented  everyday. It is significant that we keep up to date with all laws, both the present ones and the past ones,  and to understand how they may affect us accordingly in our line of work. In this article, an overview of some of the main aspects of the recently enacted act, being Act number one of 2020, is given, by virtue  of which a number of amendments were made to the PMLA.

When implementing Act 1 of 2020, the legislator had various objectives in mind, the chief ones being:  to transpose numerous provisions of the Fifth Money Laundering Directive; to implement the  recommendations made by Moneyval in its Fifth Round Mutual Evaluation Report on Malta; and to  address concerns put forward by the Venice Commission on Malta’s constitutional arrangements,  separation of powers and the independence of the judiciary and law enforcement. As demonstrated  hereunder, the underlying effect of these rules has been the reinforcement of the FIAU, as Malta’s leading  body to counter money laundering.

Measures enacted to bolster FIAU’s capabilities and to ensure its transparency. 

  • The FIAU has been vested with the capacity to administer a central bank account registry for  Malta.  
  • The FIAU has been granted the power to supervise the implementation and enforcement of any  future legislative measures on cash restrictions. This power has been granted in light of the  Maltese Government’s objective to limit cash payments to €10,000 for the acquisition of certain  goods such as immovable property, cars, boats and yachts, diamonds, precious stones and works  of art.  
  • FIAU’s powers for cooperation and the exchange of information between authorities within and  outside Malta has been enhanced. 
  • The Director of the FIAU can now only be appointed following a public call for applications. The  Director shall have the added responsibility of recruiting FIAU’s staff, a measure which  safeguards FIAU’s independency and autonomy.  
  • The FIAU’s Board of Governors, whose role is to present the general policies to be implemented  by the FIAU in carrying out its duties, has been restructured. The Office of the Attorney General  has been removed from being a member of the Board, and in its stead two new members have  been added: a member representing the Malta Gaming Authority and a member representing  the Commissioner for Revenue.

Other Significant Amendments: 

  1. Quickened Appeal Process – Appeals against administrative penalties imposed by the FIAU must  by law now be held before the Court of Appeal (Inferior Jurisiction) within 3 months of the date  of filing, and a final judgement must be given by the said Court within 6 months from the date  of hearing.
  2. Publication of Administrative Penalties – FIAU’s threshold to publish administrative penalties has  been increased from €10,000 to €50,000. Penalties amounting to less than € 50,000 have to  be published in an anonymous manner and cannot identify the subject person in question. 
  3. Publication of a list of local prominent public functions – The Minister responsible for Finance has  been vested with the right to to publish, by means of an order in the Government Gazette, a list  of those functions in Malta and of functions held within international organisations accredited in  Malta, which are considered be prominent public functions. The objective behind this role is to  aid subject persons to determine whether or not their customer is a politically exposed person  (PEP). 
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