Financial organised crime agency to be set up, Finance Minister says

A financial organised crime agency to rapidly identify and prosecute criminals is soon to be created, Edward Scicluna announced.

The Finance Minister said the government wanted the new agency to have the scale, resources and powers to identify financial criminals who have the means to threaten the integrity of Malta's financial sector and to prosecute them quickly.

The government, Scicluna said, wanted the agency to be one which "will genuinely be feared by financial criminals".

"I can announce today that the Cabinet has approved a major reform intended to strengthen the law enforcement arm when it concerns financial organised crime - the creation of a financial organised crime agency," he said. 

The new agency will not compete with the police, but will be working with them, Scicluna said. Moreover, the police will be represented in the new agency. 

He said the details concerning the formation of the agency were "not yet decided." 

"We have to finalise a set up which is suitable for our island. Organised financial crime is of a different nature from petty fraud. We need a specialised agency which deals with the big kind of organised financial crime - money laundering that originates from the banks or other financial institutions and is detected by the Malta Financial Services Authority and the Financial Intelligence Analysis Unit. We hope the new agency will address this need," he said. 

Scicluna said delegations from the Finance Ministry, the Financial Intelligence Analysis Unit and the Attorney General's office had held discussions with senior officials from the British home office to explore how Malta could tackle AML/CFT efforts better.

Scicluna, who was delivering an update on Malta's anti-money laundering/combatting of financing of terrorism (AML/CFT) preparedness, said the creation of the body was one of four key measures being adopted by the government.

The other three measures are the drawing up of a three-year AML/CFT action plan, the setting up of an independent prosecution office, and granting additional powers to the asset recovery bureau.

The action plan, Scicluna said, set out 48 tasks which the national coordinating committee on combatting money laundering, which was launched last April, is encharged with fulfilling.

He said the government would start by focusing on tax evasion, the criminal penalties for which will be significantly increased. 

"The practice of dealing with tax evasion through fines instead of through the criminal process will be revised, with a bigger focus on the criminal nature of such tax evasion. This is in line with best practice abroad and with the aim of increasing the deterrent effect," he said.

When it comes to the prosecution office, Scicluna referred to the Bill which will be splitting of the dual role of the AG through the creation of a State Attorney. He said that, through the government's proposed legal changes, the decision to prosecute would not remain the exclusive domain of the police, but when a decision concerns a crime other than a minor offence, the AG's office would have the power to prosecute.

"The AG will have the power to demand that police investigate a crime and to obtain information about the process of investigations," he said, noting that the government intended to enact the changes to the law before Parliament rises for its summer recess.

Scicluna also underlined that more powers will be invested to the Asset Recovery Bureau, enabling it to contribute more in the fight against money-laundering.

He went on to emphasise that Malta was "fully aware of the need to strengthen resources and implement legal reforms to enable a more timely investigation and prosecution of money laundering offences."

The minister also insisted that the government welcomed "reports from multilateral institutions which are technical and unpolitical" on Malta's financial sector, such as those carried out by Moneyval and the European Commission.

"No matter how much we don't like the reports, we will respond to them, as they help us strengthen our procedures and controls... Our current challenge is to ensure our efforts translate into the highest level of convictions which are warranted by the high AML/CFT profile which Malta faces," Scicluna said.