MFSA Reports a Total of €975,462 in Administrative Penalties Issued in 2020

The Malta Financial Services Authority (MFSA) released on Wednesday its Annual Report and audited Financial Statements for the year 2020, noting that the domestic financial services sector witnessed an increase of 5.5% in real Gross Value-Added rate. According to the MFSA, the rate rose to €1.028 billion last year despite the Coronavirus Coronavirus The outbreak of Covid-19 or Coronavirus in early 2020 has since redefined the financial services industry. Brokers have been forced to quickly adapt to several changes, both positive and negative.This includes the FX industry, which saw surges in volumes across the retail and institutional space in Q1 2020. This trend can be explained by an outflow of volatility, coupled with countries taking major moves to stabilize their respective economies.In conjunction with uncertainty caused by the virus, The outbreak of Covid-19 or Coronavirus in early 2020 has since redefined the financial services industry. Brokers have been forced to quickly adapt to several changes, both positive and negative.This includes the FX industry, which saw surges in volumes across the retail and institutional space in Q1 2020. This trend can be explained by an outflow of volatility, coupled with countries taking major moves to stabilize their respective economies.In conjunction with uncertainty caused by the virus, Read this Term pandemic.

Overall, the watchdog processed 265 applications for authorization, and 25% were withdrawn or refused. Moreover, the MFSA saw a higher number of supervisory inspections that totaled 419, marking an 84% increase from 2019 figures and 149% growth over 2018 numbers. About Anti-Money Laundering (AML) Anti-Money Laundering (AML) Anti-money laundering (AML) is a term that describes laws, processes, and regulations that are intended to prevent illegally obtained funds from being disguised as income gained through legitimate means. The fundamental purpose of the AML laws is to help safeguard, detect, and report suspicious activity including the predicate offenses to money laundering and terrorist financing, such as securities fraud and market manipulation.Most exchanges have AML measures that include identity verification Anti-money laundering (AML) is a term that describes laws, processes, and regulations that are intended to prevent illegally obtained funds from being disguised as income gained through legitimate means. The fundamental purpose of the AML laws is to help safeguard, detect, and report suspicious activity including the predicate offenses to money laundering and terrorist financing, such as securities fraud and market manipulation.Most exchanges have AML measures that include identity verification Read this Term) and Combatting the Funding of Terrorism (CFT), the authority commented: “The MFSA conducted 81 supervisory inspections on behalf of the FIAU, both as full-scope (comprehensive) and focused (targeted) inspections.”

During the report, the Maltese financial supervisor highlighted that they are still keeping Brexit and COVID-19 effects in the loop towards domestic financial stability. “Significant enhancements and investment in the human resource of the Authority, with a total of 16,383 hours of training provided to MFSA staff. In 2020, the Authority also set up the Financial Supervisors Academy which provides training programmes to employees, as well as to other regulators, supervisors, policymakers and academics outside of the MFSA,” the annual report noted. In addition, supervisory inspections totaled 419, representing an 84% increase from 2019.

Legal Actions Taken in 2020

In terms of enforcement actions conducted by the MFSA, the report stated that the watchdog took 52 actions that resulted in a total of €975,462 in administrative penalties. “Despite the adverse circumstances generated by the pandemic, we are pleased to note that the Maltese financial services sector continued to grow and generate employment opportunities over the past year. We remain determined to steer the sector to a higher threshold of long-term sustainability, also through the integration of new areas of supervision and potential growth,” Professor John Mamo, Chairman of the MFSA, commented on the results, which had three pillars: stability, continuity and growth.