AML/CFT & MLRO Services

Choosing the right partner is key to ensuring ongoing compliance

Anti-Money Laundering (AML) & Combating the Financing of Terrorism (CFT)

Money laundering refers to the illegal process of concealing the origins of money obtained illegally by passing it through a complex sequence of banking transfers or commercial transactions. Criminals often try to disguise the identity, original ownership, and destination of money that they have obtained through criminal conduct, with the intention of making it seem that the proceeds have come from a legitimate source. The overall scheme of this process returns the "clean" money to the launderer in an obscure and indirect way.

On the other hand, but very often closely related, Terrorism Financing refers to the provision of funds or providing financial support to individual terrorists or even terrorist groups/organisations, whether at a local or international level. Various countries have implemented different measures to counter terrorism financing often as part of their money laundering laws. At an EU level, through the implementation of EU wide directives, case in point the 4th AMLD, efforts are aimed at ensuring that all EU members are aligned with very similar AML/CFT laws, with the scope of ensuring consistency, whilst at the same time focusing all efforts towards making the EU a safer place to conduct business.

Some countries and multinational organisations have created a list of organisations that they regard as terrorist organisations, even though there is no consistency as to which organisations are designated as being terrorist by each country. The Financial Action Task Force on Money Laundering has made recommendations to members relating to CFT. It has created a Blacklist and Greylist of countries that have not taken adequate CFT action. 

Overall, Anti-Money Laundering (AML) refers to all the actions various countries take on a regular basis, aimed at prevent money laundering, whilst Combating the Financing of Terrorism (CFT)  involves investigating, analyzing, deterring, and preventing sources of funding for activities intended to achieve political, religious, ideological or other actions considered to be terroristic in nature. All these actions are predominantly lead by Financial Intelligence Units (FIUs), and are at times supported by other supervisory authorities. In Malta the FIAU is the lead authority, and the Malta Gaming Authority (MGA), and Malta Financial Services Authority (MFSA) and supervisory authorities assisting the FIAU in the areas of gaming/gambling and financial services respectively.

Christine Lagarde, Managing Director of the International Monetary Fund (IMF) stated: “There is no doubt that money laundering and terrorist financing can threaten a country’s economic stability, which is why the IMF has become increasingly active in supporting and promoting the AML/CFT efforts of our member countries, based on the [Financial Action Task Force] standard. What started as a small endeavour some 20 years ago has become part of our core work—from analysis and policy advice, to assessing the health and integrity of financial sectors, to providing financial assistance when needed, to helping countries build institutions and increase operational effectiveness.”  

The services we offer at IGA Group:

  • Assistance and preparation for an FIAU Compliance review;
  • Assistance in addressing any potential findings and recommending remedial action;
  • Assistance and representation during FIAU/MGA Compliance reviews;
  • Preparation of the Business Risk Assessment (BRA) and the Customer Risk Assessment (CRA);
  • Assistance in designing adequate AML/CFT policies and procedures in line with the updated AML regulations and Implementing Procedures;
  • Due Diligence any other related service;
  • AML/CFT Training aimed at different levels of your organisation;
  • MLRO services;
  • Preparation of the Risk Evaluation Questionnaire (REQ).

Money Laundering Reporting Officer (MLRO)

The Money Laundering Reporting Officer (MLRO) is a statutory function for Maltese domiciled companies. He/she must be reporting to the Board of Directors or be in an equivalent position and given complete access to company documentation and/or decisions taken by the company's senior management team. Although Day-To-Day Anti-Money Laundering (AML) checks may be delegated to an administrator reporting to the MLRO, it will still be the MLRO who is responsible for receiving information from any party, and taking the respective actions that might be needed.

An MLRO is expected to cover the below functions, and at the IGA Group we can either cover the MLRO role or else assist someone who covers that role:

  • Is the main point of contact in relation to AML/CFT;
  • Receiving reports of suspected ML/FT or that a person may be (or may have been in the past) connected with ML/FT. The MLRO is tasked with reporting any information related to the company he/she is either providing services to, or is employed with;
  • Considering such reports, and conducting an assessment to determine whether knowledge or suspicion of ML/FT subsists or whether a person may have been, is or may be connected with ML/FT;
  • Reporting knowledge or suspicion of ML/FT or of a person’s connection with ML/FT to the FIAU;
  • Responding promptly to any requests for information made by the supervisory authority.  In Malta it is the FIAU, and in other EU countries it is usually the FIU, albeit in some countries, case in point the UK, the gambling regulator is also completely responsible for the prevention of ML/FT.
  • The MLRO should have reasonable access to other information which may assist in considering suspicious money laundering reports;
  • The MLRO should establish and maintain a register of money laundering referrals made to him by the company and individuals;
  • Establishing clear customer verification procedures and AML polices while ensuring company employees are given adequate training;
  • Ongoing monitoring of business relationships and internal procedures ascertaining the constant updating AML procedures and other relevant reporting requirements;
  • Ensuring that internal auditing and compliance departments regularly monitor and make recommendations for up to date systems on vigilance;
  • Maintaining updated procedures and manuals, making sure any changes are regularly communicated to employees in order to ensure full compliance with laws and regulations; 
  • Keeping abreast with any regulatory updates and attending training provided by the FIAU, and/or MFSA or MGA, and the respective regulatory bodies in other countries, depending on the need.

IGA Group has a team of professionals, capable and qualified to hold the position of MLRO.  A number of reputable companies have already entrusted us with this task, and we are in a unique position to provide independent advise to the company's board of directors, making sure their company is always kept abreast with the most recent regulatory updates. 

The MLRO is considered to be a very senior position within a company, and is also the direct point of contact for all suspicious transactions. He/She needs to have enough experience and knowledge on AML/CFT legislation and regulations, to be in a position to challenge decision makers within a company, in order to make sure that AML/CFT is also given high priority.