Investigating tax evasions cases is being given top priority by the police, Deputy Police Commissioner Alexandra Mamo told a financial crimes conference on Thursday.
Mamo said Malta’s vulnerability to tax crimes carried out by both local and foreigners had led the police to prioritise investigating such cases.
The lack of tax prosecutions was highlighted as one of the main weaknesses that led to Malta’s greylisting by the FATF, a global anti-money laundering body.
Giving a breakdown of recent tax prosecutions, Mamo said there was one prosecution in 2019, seven in 2020 and two so far this year.
Anti-money laundering unit boosted by 300%
She said staff within the police anti-money laundering unit had been boosted by 300 per cent, up to 12 officers. A further eight officers are assigned to the economic crimes unit.
Last September, a fiscal crimes unit was set up to investigate fiscal related offences.
Apart from tax crimes, the deputy commissioner said the police are also prioritising investigations of organised crime, drug trafficking and corruption.
Kenneth Camilleri, acting director of the Asset Recovery Bureau, told the conference, organised by ARQ Group and the Malta Bankers’ Association, that unexplained wealth orders were seen as the next step towards bolstering the country’s abilities to seize criminal assets.
Camilleri said, however, he is “not certain” of the specific target date for the introduction of unexplained wealth orders.
Unexplained wealth orders force an individual to reveal the sources of their unexplained wealth, be it a high-end property or a luxury yacht. People who fail to give a plausible explanation risk having those assets seized.
Efforts to introduce the legislative tool last year were put on the back-burner by the cabinet.
Anthony Eddington, who is responsible for financial crime compliance at the MFSA, said onsite examinations of regulated companies would become a lot more intrusive.
'Reporting officers must know their game'
He said companies’ money-laundering reporting officers and directors must know their game and be up to speed with current legislation.
Eddington hailed the massive shift in compliance culture over recent years by regulated firms. He said there had also been improvements in the coordination between the various authorities.
FIAU deputy director Alfred Zammit said that, given Malta’s risk profile when it comes to tax evasion, the expectation was for there to be a lot more criminal investigations of such cases.
Zammit added that both the authorities and the private sector had a role to play in fighting tax crimes.
He said the FIAU expects to receive more suspicious activity reports from the private sector about tax evasion, particularly those involving large amounts.