Wednesday, June 23, 2021




 The Financial Action Task Force, more commonly known as the FATF, in a Plenary Meeting today, has voted to designate the Republic of Malta a" Jurisdiction Under Increased Monitoring," otherwise known as Greylisting. Unofficially, the primary reason is said to be Malta's failure to hand down Bills of Indictment against the principal officers and directors of its money laundering financial institutions, Including Pilatus Bank and Satabank, for criminal activities dating back several years.

The reaction from Valletta, which was described by eyewitnesses as being in a state of shock, has reportedly stunned Malta's ruling Labour Party to the core. The Prime Minister, Robert Abela, is said to be depressed by the news, which was unexpected, as MONEYVAL, the European agency that assesses compliance with European standards, appeared to have passed Malta last week. The Cabinet, according to one individual who was present after the news broke, is searching for a scapegoat to blame the Greylisting upon. The Minister of Finance, Clyde Caruana, whose uninspired eleventh-hour efforts to change the votes of countries known to be leaning towards Greylisting, is said to be their first choice. Caruana, a protege' of PM Abela, is widely thought to be unqualified for his current position. 

Private reaction has been uniformly critical of the Labour government. Malta's best-known whistleblower, Maria Efimova, after hearing the news stated about Malta, whose leaders have repeatedly refused to grant her immunity and whistleblower status, " It will surely enjoy being in the same pot with Zimbabwe and Albania." 

These issues have surfaced since the FATF decision; Panic seems to be the order of the day:

(1) Some individuals are concerned that several gaming companies are thinking of packing up and leaving the jurisdiction, as banking and compliance becomes more expensive, and worry that local banks will start losing more correspondent accounts, due to increased risks, as is being experienced by Bank of Valletta (BOV).

(2) One individual, who is known to be a target of US law enforcement activity, has reportedly made emergency travel plans to leave the country, to avoid potential arrest.

(3) Other observers are calling for Abela's resignation, early elections, and even the appointment of a Caretaker Government forthwith, to remove the members of the present Cabinet on an emergency basis. 

(4) The looming blocking of wire transfers from Malta, by compliance officers at banks in North America and the European Union, will the most immediate concern, as will probable termination of many financial services jobs held by Maltese citizens and residents.

It's going to get worse before it gets better, and Malta had better get used to being Europe's Bad Boy of Finance, with all the privileges appurtenant thereto.

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