Over 8,700 suspicious transactions reports filed with the FIAU in 2022

In 2022, 8,740 Suspicious Transactions Reports were filed with the Financial Intelligence analysis Unit (FIAU), the unit's annual report for that year revealed.

This number is 1,417 reports more than were filed with the FIAU in 2021.

"The top reporting sector remains the Remote Gaming Sector, however, following various training initiatives and support to subject persons, an increase in reporting was noted across most sectors," the FIAU said. Remote gaming companies in 2022 sent 5,049 reports while the second highest number came from Virtual Financial Assets organisations (965).

In terms of dissemination of intelligence, 6,953 spontaneous intelligence were sent to foreign counterparts, 401 were sent to the Commissioner for Revenue, 343 to the Malta Police Force and 204 to supervisory authorities and other competent authorities.

Asked about the low number sent to the police, FIAU acting director Alfred Zammit gave the example of those received from the gaming sector, saying that persons reported are many a time abroad, and that in such cases foreign authorities are better placed to take action on the intelligence.

The top three reasons for suspicion that were reported were unknown sources of wealth or funds, transaction activity which is unexplained or inconsistent with known customer profiles and refusals to provide source of wealth or information.

As for fines, the FIAU's enforcement section issued 33 administrative measures, of which 22 were issued on an anonymous basis "meaning that the compliance examination had either resulted in a directive to take remedial action or in an administrative penalty that did not exceed €50,000. The total amount of administrative penalties imposed during 2022 amounted to €3,355,443", the report reads.

An FIAU statement accompanying the annual report reads that "the response rates to the annual Risk Evaluation Questionnaire (REQ) – an important source of information for the FIAU's risk-based approach to supervision – continued to improve, reaching an average of 98% across the financial and non-financial sectors, with some having a 100% response rate", the FIAU said.

The FIAU has fostered strong collaborations with domestic and international stakeholders, including regulatory authorities, law enforcement agencies and financial institutions, to create a united front against financial crime, the unit said. "The unit is focused on improving both local and international engagement through widespread initiatives, from training sessions locally and overseas to conferences on both fronts, to Public Private Partnerships and participation in international fora. Nationally, for example, the FIAU organised no less than seven AML/CFT clinics with representatives from the banking industry, as well as several other Public Private Partnerships with other private sector representative bodies."

FIAU chairman Kenneth Farrugia, said in the report, that 2022 was a challenging year for the unit, "however it was one that gave the FIAU great satisfaction and a sense of pride. As in previous years, but even more so during 2022, the FIAU team worked hard, with steadfast commitment to carry out as effectively as possible

the functions assigned to the unit, and to address the areas indicated by the FATF, that required improvement. The result was that by the end of the first half of the year, Malta was taken off the FATF grey list".

Training and education initiatives

The FIAU said that it is committed to improving compliance by all subject persons. "This is not only achieved through supervision and enforcement but also through education. Staff from all across the unit took part in no less than 70 training initiatives, by participating in panels, giving presentations and knowledgesharing. Of these, 16 were FIAU-led initiatives. Catching them young is also on the FIAU's agenda through interventions in schools and participation in various students' events."

Zammit expressed pride in the accomplishments highlighted in the report and stated: "The FIAU's Annual Report 2022 stands as a testament to our unwavering dedication to safeguarding the integrity of Malta's financial system. We remain steadfast in our mission to combat moneylaundering and the financing of terrorism." He also took the opportunity to "thank Mr Kenneth Farrugia, who served as the FIAU's director between 2017 and 2023, for his hard work, commitment and dedication to the FIAU throughout his tenure".