Practitioners need enabling powers for information exchange – IFSP President

10th August 2020 • News

Practitioners must have enabling powers or laws providing for the exchange of information, according to Wayne Pisani, President of the Institute of Financial Services Practitioners.

He stressed the need for information exchange among practitioners and between public/private parties, arguing that practitioners need enabling powers or laws providing for such exchange of information between them, unencumbered by General Data Protection Regulation or tipping off concerns. If possible, there should also be two-way information sharing between the public and the private sector, he asserted.

Dr Pisani also sees a dire need for the central authorities to keep practitioners abreast, even of the outcome of suspicious transaction reports.

Speaking about the looming threat that Malta could be grey listed by the Financial Action task Force it is fails the Moneyval test, he pointed out that arraignments, asset-freezing and convictions increased throughout the evaluation process in the case of countries that faced or are facing the possibility of being grey listed. Admittedly, he was quick to add, the success of a country’s efforts in combatting money laundering and the funding of terrorism should not be limited to a matter of numbers but more a matter of effective measures through the implementation and enforcement of regulations.

Though he does not believe that effective enforcement should be gauged in terms of the number of arraignments and convictions or the value of assets confiscated, he admitted there is a risk the country may be assessed purely on the basis of numbers, adding one can only hope this will not be the only gauge.

“This should not be a tick-the-box exercise but should involve the necessary effective coordination between the key public and private stakeholders. Short of such coordination, and a public private partnership to address the concerns, would run the risk of overdoing regulation and enforcement on the majority of the fronts and failing to make any concrete action on others. We need to be smart and effective in the way we raise the bar,” he said.

This is not a matter of churning out regulations and procedures or issuing uncoordinated data-gathering exercises and setting reporting deadlines with material fines with no macro vision and coordination, the IFSP President noted.

Rather, he continued, there is need of efficiency in processes and do away with the silo mentality within Government institutions. Passing the Moneyval test at the cost of a far too burdensome and non-efficient bureaucratic culture would mean failing the economy because Malta would not be a valid platform for business, he warned.

The institutions must do their part, and service providers as well as practitioners must proactively engage in upholding Malta’s reputation, working together to efficiently implement the necessary measures to raise the bar and report, block or oust any business not consonant with the country’s economic values, Dr Pisani insisted. Also, he added, the country’s economic direction needs to be within those areas that strengthen the credibility of the jurisdiction as an EU member state.

In his view, the difficulty to get banked in Malta is evidence of the wrath of the international political and financial community. Neither Malta nor the EU could afford a eurozone country and an EU member being grey listed, also considering resultant international economic ramifications, he explained.

The adverse effects on Malta if it were to be grey listed would be short, medium and long term, he continued. The key focus in case of grey listing should be to swiftly implement the remaining Moneyval recommendations and reverse the grey listing status in the shortest term possible while keeping the national and international public community abreast of the effective progress made in combating financial crime.

“It ultimately boils down to a matter of accountability and efficiency.

“We need to become more credible and relevant and this should be an opportunity to show the country’s resilience and focus our resources to work together as practitioners as well as with the institutional bodies to navigate the present issues and continue growing the key pillars of our economy within the realities of today’s global economy… be it the call for unity, convergence, transparency, sustainability and a nationally aligned concrete vision,” Dr Pisani said.

Source: – This is an extract of a feature first carried in the July edition of The Malta Business Observer.