20 - 26 September 2001

Government stepping up efforts to combat money laundering

by David Kelleher

The government is stepping up its efforts to combat money laundering with the setting up of a Financial Intelligence Unit within the coming months.
A draft bill that outlines the functions, structure and powers of the unit has already been drafted. Addressing a one-day conference on money laundering on Monday, organised by the Malta Financial Services Centre, Finance Minister John Dalli said the setting up of the FIU is in line with the government’s commitment to step up efforts to combat money laundering in all its forms.
“In line with out commitment, the government intends to set up the unit on the Egmont Group model. This will be done through primary legislation, in particular through further amendments to the Prevention of Money Laundering Act, demonstrating the importance government attributes to the role of this unit,” Mr Dalli said. He said the unit will be independent from the police and from the financial regulatory authorities and will be entrusted with the collection, analysis and dissemination of information with a view to combating money laundering.
“The financial intelligence unit will be the recipient of suspicious transaction reports (currently made to the police) and will be empowered to request any information it may deem necessary in order to supplement reports and to transmit such reports to the police where it has reasonable grounds to suspect money laundering,” Mr Dalli added.
In a detailed presentation, Dr Silvio Camilleri, deputy attorney gen-eral, gave the reasons why the present system of providing the police with report was not the perfect structure to tackle cases of moneylaundering. He said that the police were sometimes too quick to take action, and sometimes did not have the necessary and required financial expertise.
The setting up of the Financial Intelligence Unit, he said, would
create a structure that had the required expertise and was a separate entity from the police. This would give reporting agents greater incentive to file reports.
Dr Camilleri explained that there were four models – the Intermediary/administrative unit, the police, judicial and mixed (comprising both the police and judiciary).
“Following meetings between the Central Bank, the police, the MFSC and the office of the Attorney General, it was decided that the intermediary/administrative model was best suited for Malta. This model allows the unit to serve as buffer and filter before any reports are passed on to the law enforcement agents,” Dr Camilleri said.
He said a bill outlining the structure and function of the FIU had already been drafted. “The FIU will have a monitory and supervisory role and the capacity to gather information,” he added. The FIU will comprise four members appointed by the Minister of Finance in consultation with the Attorney General. If the need is felt to boost the unit’s level of expertise, the number of members may be increased to six.
“The members will serve for a period of five years and enjoy the highest level of autonomy. The board will consist of a chairman and deputy chairman, director and other officers including a Police Liaison Officer. The latter will have a very important role in that he will act as a focal point between the board and the police. The PLO, who will have a rank not lower than that of inspector, will have direct access to all information at the disposal of the police,” Dr Camilleri said.