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Deadline Alert: Malta’s Money Laundering And Compliance Rules Are Getting Tougher And Professionals Must Adapt Fast

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In its efforts to respond to Moneyval’s financial warnings, Malta has introduced new legislation and rules for company service providers, intended at improving regulatory conduct and clamping down on money laundering.

If you offer fiduciary services, you should have heard of recent changes to the Company Services Act and a new hefty rulebook published by the MFSA to help people in the industry get in line with the new law.

It’s no joke. CSP companies, lawyers, accountants, auditors and warranted professionals must submit a lot of information about their operations and clients to the MFSA and FIAU.

This includes everything from details of their business risk assessments and verification methods for new clients to their due diligence procedures for clients identified as posing a low, medium and high risk.

Warranted professionals who were previously exempt under the de minimis rule are no longer exempt and must also submit themselves to regulations they may not have been used to.

Company service providers have until 16th May to apply for authorisation with the MFSA; failing that they risk operating outside the law.

These laws are intended to give the Maltese authorities as much oversight as possible into the financial services regime, with the logic being that more regulation will lead to fewer people getting away with laundering money and ultimately Malta improving its reputation within global financial circles.

However, these new rules will require a culture change towards greater compliance and making heads or tails of them can be quite overwhelming.

And this is where Diligex comes in.

A young Maltese firm, Diligex was exclusively set up to provide solutions and technical support on AML/CFT compliance obligations to the financial services industry.

With a team of experts in the industry, including people with experience working at Maltese regulators or seasoned MLROs and compliance officers, they will analyse your business, give you bespoke solutions, and help you navigate through all the red tape.

This is what you can expect to happen once you reach out to Diligex.

Photo: Diligex

Photo: Diligex

1. First up, they’ll assign a lead compliance specialist to scrutinise your business operations and ensure everything is shipshape in light of the anti-money laundering framework.

Even if you’ve never even dreamed of laundering money, your structures could be such that they facilitate money laundering and you may well not even be aware of this.

Diligex’s compliance manager will let you know what facets of your business you should improve and why, ensuring you fully understand the regime and your part in it all.

They will then provide you with the solutions you require yo fill in the gaps.

2. Diligex will also guide you through the complex process of risk analysis, including by conducting an expert risk assessment of your business structures and by helping you assess the level of risk of the clients you onboard.

You will understand why some clients are considered riskier than others, what obligations you have vis-a-vis your clients, how to immediately identify potential risks, and how to manage any issues which may emerge over time.

Compliance cannot be a one-off procedure but part of your business’ core setup, so it’s crucial you understand what is expected of you.

3. Business risks surrounding the operation of your business can also suddenly hinder or stall your business, putting you and your clients at peril.

Diligex’s setup can assist you with setting up the new requirements for your business’ risk management.

Risk management can be seen as a burdensome arm of the business or else a proactive unit that helps protect your business and mitigate risks.

You can look at it as a matter of perspective.

Diligex’s setup works on the latter approach and helps set out the necessary risk management policies.

4. The aim of the new rules is for businesses to adopt regulatory compliance as part of their culture, and not a one-off or something that happens once a year.

Diligex does not only come in to simply draft your policies and have them shelved.

Compliance requires that these policies are put into practice; otherwise, you will not get any benefit and won’t be compliant in practice.

Diligex excels at assisting in building that compliance culture in your business – the compliance function is key. This helps you protect your business and your clients’ well-being.

5. Red tape is a headache for every business, and the reality is that these new rules will significantly increase the load for company service providers.

It may be a cumbersome process, particularly when you’re busy trying to actually run your business, but Diligex will help you understand whether you need to register at all, and if so which documents you need to find and provide, and which boxes you need to tick.

They will alleviate your burden and hold your hand throughout as you get in line with the requirements.

These are times of great change for Malta’s financial services industry and it’s unlikely the industry will look the same once the Moneyval process is over.

While the temptation might be to shrink your operations and shut your doors to clients which may pose even the slightest bit of risk, the people at Diligex are determined to prove that business can still operate smoothly with a higher level of compliance.

But with the 16th May deadline for registration looming ever closer, time is of the essence to get your business in order, and with Diligex’s assistance, you can get there and start planning for life in this new and tighter regime before it’s too late.

Tag someone who needs to be informed about this imposing deadline 

READ NEXT: WATCH: Meet Some Faces Behind The Helmets Of Malta’s In-Demand Green Motorbikes 

Tim is interested in the rapid evolution of human society brought about by technological advances. He’s passionate about justice, human rights and cutting-edge political debates. You can follow him on Twitter at @timdiacono or reach out to him at [email protected]

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