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The Financial Action Task Force (FATF) voted to remove Malta from its so-called grey list yesterday (15 June), according to various reports from Maltese media sources.

While the outcome of the vote has yet to be made official, both the Times of Malta and the Malta Independent reported that FATF member states had agreed to remove Malta from its list of jurisdictions with weak measures for combatting money laundering and financial crime.

Malta’s change in designation is the result of a secret vote taken at ongoing FATF meetings in Germany. The global financial watchdog will publish its official decisions on Friday.

According to the sources, the vote was taken by 37 jurisdictions and two regional organisations; the European Commission and the Gulf Cooperation Council, which are recognised as members of the FATF.

While Malta did not have a say during the sittings, it is understood that the country lobbied other members to speak on its behalf.

Malta was added to the list of jurisdictions under increased scrutiny in June 2021, after the intergovernmental organisation found that it was not doing enough to combat financial crime. 

This marked the first time that an EU member state had been put under increased international scrutiny and enhanced monitoring by the FATF.

Malta was given a long to-do list and a detailed action plan to strengthen its anti-money laundering and funding of terrorism (AML/CFT) framework.

At its February 2022 meeting, the FATF announced that Malta had substantially completed its action plan and was ready for an on-site assessment. FATF representatives then visited the island in April.

Throughout the past year, the country has implemented several reforms and overhauled its compliance frameworks to ensure international AML obligations are met and its institutions have the power and resources to detect and prosecute financial crime.

Although Malta will be removed from the grey list, it will need to continue working with FATF and show that it is committed to preventing financial crime beyond the end of the greylisting.

The decision comes at a time when Malta’s Gaming Authority (MGA) has itself been shown to combat corruption in its ranks. 

The regulator’s former chief technology officer, Jason Farrugia, recently appeared in court on charges of money laundering alongside his wife, Christine.

Farrugia had left the MGA disgraced in 2021, after he was alleged to have leaked confidential and commercially sensitive information held by the authority. 

The Financial Crime Investigation Department of Malta’s police force subsequently launched an investigation, leading to the charges being brought against Farrugia in court.

Featured image credit: Hervé Cortinat / OECD

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