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Malta & FATF's "grey list"-The war & Europe's BO Register-Premature plans by Germans to host AMLA

In EU circles, there is growing optimism that Malta will be delisted by the FATF early this summer.

When the island was placed on the task force's 'grey list' last June – incorrectly in the opinion of many in the Union – there was widespread outrage in Brussels.


However, there was much optimism – if not complete confidence – in Brussels this week that Malta would be removed from the Financial Action Task Force's 'grey list' following an on-site evaluation next month.


The delisting will most likely be announced in June, on the first anniversary of the listing in 2021.

"We feel it was wrong that Malta was listed in the first place. Yes there was a technical breach but it was a big step to put Malta on the grey list. It will be good to see the country delisted," one high-ranking EU official recently stated,


Malta is the only EU country on the 'grey list,' which has caused the union embarrassment.


Being on the list has a significant financial impact. Former FATF executive secretary David Lewis wrote in his expert column on AML Intelligence earlier this month that the "IMF recently estimated the impact for countries on the list include a reduction of capital inflows of 7-8 percent of GDP."


The UAE was added to the list last month, though some analysts believe the impact on the economy has been muted due to the large amount of Russian money rerouted and deposited in Dubai.


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The importance of tougher Beneficial Ownership, as promised by the European Commission last year, has been highlighted by Russia's invasion of Ukraine.


With wealthy Russians attempting to move their assets, some European officials believe that proper Beneficial Ownership regulations are necessary to ensure that the bloc's economic sanctions are not broken.


Sources in Brussels told 'Schuman Notebook' that the regulations were now seen as "crucial," and that EU Member States were working together to implement BO standards across the bloc.


When the plans were first announced last year, officials expected opposition from certain Member States, so they were surprised to see such unanimity. Nonetheless, the EU is more united than ever on the advantages of BO Registers.


As the EU tries to plug existing loopholes and put pressure on Putin's closest allies, it appears that his desire for division has only brought anti-financial crime legislation closer to Europe.


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The German government has set aside €10 million to cover the cost of Europe's new anti-money laundering authority (AMLA) being based in Frankfurt.


The consensus in Brussels this week is that Berlin is engaging in overly optimistic posturing, though I am sure Germany will argue that it is simply prudent provisioning. There is no guarantee that Germany will receive AMLA. In fact, Paris and Vienna are still contenders for the headquarters location.


Meanwhile, Dublin has effectively ruled itself out of contention.


Furthermore, there is speculation that the European Parliament may be forced to vote on the issue – and with France currently serving as Europe's de facto leader, Paris remains the most likely location. But do not dismiss Vienna!


Some AML team members at the EBA in Paris – who can re-deploy to AMLA if they wish – may be swayed if they can stay in the City of Light.

By fLEXI tEAM

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