Fi­nan­cial in­sti­tu­tions should not only look at PEPs

Malta Independent - - FRONT PAGE - Kevin Schem­bri Or­land

Fi­nan­cial in­sti­tu­tions should not only look at whether peo­ple are po­lit­i­cally ex­posed per­sons, but also at whether or not the per­son in ques­tion could in­flu­ence po­lit­i­cal power, Chair­man of the Com­mit­tee of Ex­perts anti-money laun­der­ing mea­sures Daniel The­lesklaf has in­di­cated.

The afore­men­tioned state­ment was made dur­ing a meet­ing of the EU Par­lia­men­tary Com­mit­tee look­ing into the Panama Pa­pers.

PN MEP David Casa asked: “In Malta, we have the only EU min­is­ter in­volved in the panama pa­pers scan­dal. To iden­tify a min­is­ter as a PEP is easy.

“We had another PEP in­volved, the Chief of Staff of the Prime Min­is­ter, who has a lot of po­lit­i­cal power. How can we have a sys­tem where these po­lit­i­cally ex­posed per­sons are im­me­di­ately ex­posed and pre­vent them from mak­ing such deals? We need to have a bet­ter sys­tem than we have to­day.”

Keith Schem­bri was men­tioned in the Panama Pa­pers, for hav­ing opened com­pa­nies both in Panama and the Bri­tish Vir­gin is­lands. Along with Mr Schem­bri, Min­is­ter Kon­rad Mizzi had also opened one in Panama, which re­sulted in his los­ing his health and en­ergy port­fo­lios, although he is still very vis­i­ble when it comes to en­ergy-re­lated projects.

In re­sponse, Com­mit­tee of Ex­perts on the Eval­u­a­tion of An­tiMoney Laun­der­ing Mea­sures and the Fi­nanc­ing of Ter­ror­ism (MONEYVAL) Mr The­lesklaf said that he is un­able to speak of the spe­cific case of which he has “no author­ity and lit­tle knowl­edge about”.

“We shouldn’t for­get that if someone is not a PEP, this does not mean there is no risk. The in­stru­ment to de­fine peps only says that banks and oth­ers need to ap­ply en­hanced due dili­gence with these per­sons.

“It doesn’t mean they can’t do any­thing with re­gard to oth­ers. If someone has a se­nior po­si­tion in gov­ern­ment, it’s ex­actly as you say. The ac­tual ques­tion is, does he have ac­cess to funds, can he use his in­flu­ence for im­por­tant de­ci­sions that have an eco­nomic ad­van­tage. It’s not nec­es­sar­ily the ti­tle of the per­son, whether he is an am­bas­sador or not or a min­is­ter or not, it’s rather a ques­tion of whether he in­flu­ences po­lit­i­cal power”.

He went on to say that it is eas­ier for a do­mes­tic fi­nan­cial in­sti­tu­tion to recog­nise such per­sons, and that it is slightly harder for in­ter­na­tional in­sti­tu­tions, “but there are a lot of com­pa­nies that can pro­vide such in­for­ma­tion, com­mer­cial com­pa­nies who sell it for money, that fi­nan­cial in­sti­tu­tions can use. We rec­om­mend fi­nan­cial in­sti­tu­tions to use that in­for­ma­tion. How can we help fi­nan­cial in­sti­tu­tions to de­tect abuse? One good ex­am­ple and prac­tice are in­come dec­la­ra­tion sys­tems, and many coun­tries oblige their se­nior politi­cians to de­clare their as­sets and in­come mak­ing that in­for­ma­tion avail­able, at least, to fi­nan­cial in­sti­tu­tions. That is a very use­ful in­stru­ment”.

In his afore­men­tioned re­sponse, he is high­light­ing that fi­nan­cial in­sti­tu­tions should be aware of per­sons with cer­tain power, and not just look at ti­tles.

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