The iGaming European Network, a group of iGaming companies based in Malta, has expressed its “disappointment and surprise” as its first reaction to Malta’s greylisting.
Enrico Bradamante, speaking on behalf of the association, said the government’s ability to ensure that Malta’s stay on the FATF’s list “doesn’t drag on for years” will be a direct factor in companies’ consideration of whether it is worthwhile to remain on the island.
“I can certainly state that from the companies I’ve spoken to, I haven’t seen any intention to move to another jurisdiction because Malta was greylisted,” Bradamante said. “Of course, this very much depends on what happens and how long we will remain greylisted,” he added.
He argued that companies have taken this stance based on “the expectation” that the increased monitoring procedures of the FATF will not take years to turn around.
“The expectation is that the government will continue addressing this situation with renowned speed, vigour and resources to ensure that we will not be in this situation for too long,” Bradamante said.
“If it goes on for 12 months and we are kept informed and real progress is visible, then I don’t see companies preparing to leave,” he added. “On the other hand, if this work drags on and goes on for years, the longer it goes on, the more likely it will be that companies will have to take action.”
The association said that while “over the past two years the government has done a lot of work to address the failings that were highlighted in the Moneyval report” the FATF saw a lack of enforcement of new legislation that was based on the 58 failings highlighted in the mutual evaluation process.
“We were cautiously optimistic when we heard that Malta passed the Moneyval assessment a few months ago. In theory, all the technical assessment and strengthening of the institutions was done correctly,” Bradamante said. ”But, as we’ve seen in the FATF’s press conference on Friday, the FATF has found Malta wanting on three of the 58 counts that were originally flagged.”
“Not enough was done when it comes to enforcement. The new laws have not been implemented to a large enough degree,” he added.
Malta’s igaming companies had been preparing for the possibility of greylisting, and Bradamante referred to specific contingency measures that were taken as well as what is being expected in the imminent future.
“We need to see what the consequences are going to be but we are prepared for an even more difficult banking environment for the industry,” the association’s spokesperson said.
“The greylisting will definitely trigger more due diligence. This is not an issue for the regulated, clean gaming industry that wants to operate lawfully, but this will definitely increase the administrative costs, paperwork and time,” he added.
When asked about the association’s reaction to an FIAU press release about local operators being told that they would not have to necessarily step up due anti-money laundering and counter-terrorism financing frameworks, Bradamante said that it will ultimately be up to “payment providers” such as banks to determine their course of action.
“Everybody will have to make their own assessments and determine what to do or not do. I see the FIAU’s guidance for what it is – a guide for practitioners in Malta. However, how each institution will react is going to be their decision for their own reasons,” Bradamante said.
“How foreign entities will determine what to do will be their own decision, too,” he added.