Malta Faces Blow After Being Greylisted by Financial Crimes Watchdog

Malta Faces Blow After Being Greylisted by Financial Crimes Watchdog

From Reuters:

On 21 June, Maltese Prime Minister, Robert Abela, announced the country has been placed on the Financial Action Task Force’s (FATF) greylist. FATF is the world’s money laundering and terrorism financing watchdog. This move places them on the same list as Syria and Zimbabwe.

The Paris-based FATF agreed to put Malta on the grey list of untrustworthy jurisdictions during a secret vote earlier in the day, meaning that the country now faces increased monitoring. FATF made its move after years of international criticism of Maltese policy making, including the sale of national passports, as well as a lack of legal action against government officials who were mentioned in the Panama Papers as having set up secret offshore companies.

We remain committed to making whatever reforms are needed while preserving the national interest. We will never be uncooperative or obstructive but will intensify our resolve to fight money laundering and the financing of international terrorism.

-Maltese Prime Minister Abela announcing FATF’s decidion

A working paper issued on May 27 by the International Monetary Fund said greylisting led to a large and statistically significant reduction in capital inflows as investors shifted funds out of the affected countries. As of February, there were just 19 countries that the FATF deemed to have “strategic deficiencies” and were under increased monitoring, including Zimbabwe, Syria, Panama, Myanmar and Albania.