The Maltese government’s 2017 assessment, which has not yet been published, found the country to be at high risk of foreign proceeds of crime being transferred into the island, and at a medium-high risk of local crime, including tax evasion, fraud and drug trafficking.
The report also claimed that revenue from the illicit market in Malta reached 1.4% of GDP, while tax evasion was estimated to be 5% of GDP.
These findings follow notification to Malta’s Pilatus Bank by the European Central Bank on 5 November that it is revoking its license, two years after it was implicated in an alleged money laundering scandal.
Terrorist financing threat
The study also revealed Malta to be under threat of exploitation by terrorist organisations, claiming the island’s location exposed it to funds obtained from criminal offences in high-risk neighbouring countries.
The government found weaknesses in controlling cash movements at sea and airport terminals. It added that people financing terrorism could also exploit the lack of oversight on specific products and transactions.
The country’s overall terrorist financing threat was deemed to be medium-high.
Since the assessment was undertaken last year, the Maltese government, in April, introduced its first-ever anti-money laundering and terrorist financing strategy.