MGA: Malta MLROs require deeper training on nuanced AML threats  

The Malta Gaming Authority (MGA) has recognized that, although licensees have a sound understanding of Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) regulations, there are still significant gaps that need addressing to maintain a risk-based approach to financial threats.

This observation stems from the completion of a thematic review of Malta’s remote gambling sector by the MGA and the Financial Intelligence Analysis Unit (FIAU).

The purpose of the joint review was to evaluate the AML/CFT regulatory knowledge of licensed businesses, including the application of company policies and procedures by Money Laundering Reporting Officers (MLROs) and other executives of remote-licensed gambling operators.

The review involved 23 compliance examinations and placed particular emphasis on MLROs and employees responsible for AML/CFT compliance.

Interviews with MLROs revealed a solid grasp of essential protections and measures to prevent money laundering, such as risk profiling, KYC checks, and awareness of general threats. Nevertheless, the FIAU pinpointed areas for enhancement, particularly regarding the comprehension of administrative measures and the specific risks associated with AML exposures.

Significant improvements were identified in unique aspects of AML/CFT processes, including jurisdiction reputability assessments, customer risk assessments, due diligence, screening of politically exposed persons (PEPs), and the documentation of unique threats.

Given that MLROs typically have 3-5 years of AML/CFT experience, the review suggests prioritizing training in nuanced areas of AML/CFT, while acknowledging challenges such as conflicts of interest and time constraints due to other organizational roles.

The review advises that MLROs benefit from training tailored to the Maltese legal framework and the specific risks and procedures of the remote gaming sector, noting that current training quality may be inadequate.

The MGA concludes that licensed operators must take proactive steps to improve their AML/CFT controls, emphasizing the importance of continuous education in mitigating money laundering and financing of terrorism (ML/FT) risks. It encourages operators to ensure ongoing training for MLROs and relevant employees to keep them informed about evolving AML/CFT obligations and risks related to their companies’ operations, activities, and controls.

Both the MGA and the FIAU urge MLROs and relevant employees to acquaint themselves with the review’s findings and integrate any necessary enhancements into their practices.”