Issue link: https://maltatoday.uberflip.com/i/1387622
4 maltatoday | SUNDAY • 27 JUNE 2021 NEWS Bartolo: 'Let's not invent conspiracies about greylisting' MATTHEW VELLA FOREIGN minister Evarist Bartolo has said the FATF's greylisting of Malta was like a "clean bill of health" that re- quired the island, the first EU member state to earn the dis- honourable mention, to keep up its fitness. Bartolo's reaction, posted in a customary Facebook status, comes a day after the Financial Action Task Force said it want- ed a political will from Malta to bolster its otherwise technical- ly compliant anti-money laun- dering framework. The foreign minister also said Malta should not be surprised that other countries view the island with suspicion if it ena- bles the evasion of profits gen- erated in other countries. Bartolo appeared to pour cold water over claims from gov- ernment soures that Malta had been the victim of a conspira- cy of powerful nations in the FATF. "We have to do our duty. Let's not invent inexistent conspira- cies. We're part of the world and its financial and economic system. We must carry out our duties responsibly and serious- ly, and respect the internation- al rules against money launder- ing. We've done a lot: now we have to do what's left and our country will be better off." "The FATF report shows Mal- ta has advanced but there are areas it has to work harder on. There are 200 countries, Mal- ta included, working on high- er standards within the FATF framework. Our duty is not to allow others use our coun- try for the laundering of dirty money." Bartolo said Malta should show the same zeal it had in retaining neutrality from mil- itary powers, to make sure its financial centre is not used to as a clearing house for illegal- ly-earned case or for tax eva- sion. "We too want to have wealth in this country, so we cannot be surprised at other countries who want to safeguard their wealth and see our country be- ing used against theirs when it comes to financial transac- tions. The world is not against us. Even the FATF spoke in our favour. We just wanted others to appreciate our efforts. After all, there are greater sinners than us." Evarist Bartolo: countries whose wealth is sucked by international tax avoidance are suspicious of Malta's rules on anti-money laundering €1 billion in uncollected taxes CONTINUED FROM PAGE 1 In 2019, the Inland Revenue Depart- ment had arrears running into a massive €1.3 billion of which €997 million were considered not collectable. The self-as- sessment system alone contributed €646 million to those tax arrears of which a whopping €533 million were estimated uncollectible. And no, the arrears did not start over the past years but are part of a legacy spanning decades. Tax evasion is a problem with deep roots but is often given short shrift by politicians and public authorities. But the laissez affaire attitude has now come back to bite. In its official communication last Fri- day, the Financial Action Task Force listed tax evasion as one of the reasons for Malta's greylisting. FATF said the Financial Intelligence Analysis Unit's analysis has to increas- ingly focus on serious tax offences and money laundering cases in such a way that produces intelligence that "helps Maltese law enforcement detect and in- vestigate cases in line with Malta's iden- tified money laundering risks related to tax evasion". In simple terms, tax evasion is a crime that has to be detected and prosecuted. The FATF is concerned with the more rampant cases, where tax evasion runs into thousands and millions, and in some instances, is also the result of in- come derived from criminal activity. The end result is people and criminals trying to launder the ill-gotten gains or unpaid tax by hiding the money in off- shore accounts, using cash for valuable purchases or using legitimate businesses to 'wash' the money. FATF was also clear on the need for Malta to ensure that accurate informa- tion is collected on the ultimate benefi- cial owners of companies and effective sanctions are applied on professionals who fail to comply with reporting obli- gations. The operative word in the press con- ference delivered by FATF chief Marcus Pleyer on Friday was "effective imple- mentation". This means it is not enough to have ro- bust laws and beef up institutions. What counts is action, and unfortunately, Mal- ta has a lot to answer for in this regard. The FATF decision may be unfair, giv- en the volume of work done in the past 18 months and the willingness shown to investigate and prosecute major cases, but it also shakes to the core the 'Maltese way' of doing things. The ongoing compilation of evidence against Yorgen Fenech is showing how the cosy relationship between busi- nesspersons and public authorities can turn toxic. It shows the dangerous sym- biosis between people in power and peo- ple with money, who feed off each other at the expense of the common good. While the smallness of Malta makes it inevitable for people to know each other, clear rules of engagement are necessary and where those rules are broken there must be consequences. The need to combat money laundering and tax evasion stems from the need to have a level playing field and a sustain- able economy, Pleyer said on Friday. He also warned that Malta "must not down- play the seriousness of the matters at hand". The government has said it will co- operate with FATF and Moneyval to ensure that the concerns raised will be addressed in the shortest time possible. There are no legal consequences for greylisting but things will get complicat- ed in some sectors like financial services and gaming. FATF did recognise Malta's progress on several fronts since 2019, including resourcing the police and empowering prosecutors to investigate and charge complex money laundering cases, intro- ducing a national confiscation policy as well as passing a non-conviction based confiscation law. But Malta now needs to go for the kill and ensure that the changes introduced over the past 18 months deliver concrete results for now and for always. "Let's not invent inexistent conspiracies. We're part of the world and its financial and economic system"