With particular reference to the escalating crisis with regards to Russia and the Ukraine, the Malta Financial Services Authority (“the Authority”) reminds its licence-holders of their obligation to ensure that they have effective systems and controls in place to ensure that they effectively sanctions screen any named person or entity named in any applicable sanctions List.

As a guide, the Authority highlights that obligated licence-holders ensure:

1. That their sanctions screening systems are operating correctly and are correctly calibrated where fuzzy logic is utilised;
2. That client databases are subject to using the latest applicable sanctions Lists and that licence-holders are agile with reacting to changes in those applicable Lists;
3. That where applicable, payment screening systems use the latest applicable sanctions Lists and that they are agile with reacting to changes in those Lists;
4. To take note of the latest additions with respect to the Russia/Ukraine matter;
5. The Authority brings to the attention of licence-holders:
   1. that if Euros are used in a transaction, then licence-holders must ensure that they comply with the latest EU sanctions – please see - https://foreignandeu.gov.mt/en/Government/SMB/Pages/SMB-Home.aspx for further information;
   2. that if Sterling is used, then licence-holders should ensure that they comply with UK sanctions as well as EU sanctions;
   3. that if USD are used, then licence-holders should ensure that they comply with US OFAC sanctions as well as EU sanctions; and
6. The Authority reminds licence-holders of their obligations to identify sanctioned persons and entities, within among others, financial institutions, Trusts, Funds and correctly identify and sanctions screen all beneficial owners and related third parties as stipulated by the Maltese PMLFTR (SL373.01) and National Interest Act (Chapter 365).

The Authority is not responsible for enforcing asset freezes or sanctions violations. We do expect you to ensure that you have adequate and effective sanctions systems and controls in place to mitigate the risk of financial crime and to meet your economic sanctions obligations.

The Authority reminds its licence-holders that if there is any doubt with regards to a relationship or transaction with a direct or indirect link to any party named within any applicable sanctions List, that they contact the Sanctions Monitoring Board as soon as practicable.