31 August - 6 September 2000

Action extremely unworthy and diminishes Jersey - Dalli

by a staff reporter

Last week the Jersey Financial Services Commission issued guidance notes to finance industry practitioners in Jersey.

The substance of these notes is that Malta's anti-money laundering standards fall short of those on Jersey and those required by the Financial Action Taskforce (which published a report in June 2000 on standards in a large number of jurisdictions, including Jersey and Malta). In response to Jersey's action, Finance Minister John Dalli made the following statement:

"Jersey FSC's action in naming Malta in the way it has is extremely unworthy of an island which hitherto has held itself up as a model of integrity and good practice.

The Financial Action Taskforce stated that Malta has extensive anti-money laundering legislation and raised only one issue regarding Malta - that was in respect of nominee companies. Under the guidance of Malta's regulators, every finance business in Malta has since taken action to remedy the situation.

When Maltese officials visited Jersey in July they would have been delighted to answer any questions from JFSC on Malta's standards and practices, but their efforts to arrange meetings with Jersey's senior regulator and senior civil servant were unsuccessful. Let's just look at Malta's record.

"The OECD did not name Malta as a tax haven when that organisation published its report on Harmful Tax Practices in June 2000 (after the FATF report). Malta has reached an accord with the OECD and entirely supports its work. Jersey has not reached an accord and has been publicly critical of the OECD.

"Malta began disengaging from offshore finance in 1994 and this year withdrew from the Offshore Group of Banking Supervisors. Our relations will now be with the mainstream banking supervision bodies. Jersey remains offshore and remains a member of the OGBS. Jersey FSC has taken its action without benefit of the objectivity or any of the political or moral legitimacy of the great international organisations and without bothering to establish the facts."