WILL MALTA HAVE TO CHOOSE BETWEEN MONEYVAL & BETTING INDUSTRY?

Malta, the European online gambling hub, could be forced to choose between its sports betting industry and passing the Financial Action Task Force (FATF) Moneyval test. 

As previously explained, two years ago, Malta’s anti-money laundering framework failed a Moneyval review, and the tiny island country was ordered to implement a number of reforms before a reassessment. 

However, with the FATF expected to announce its first decision on Malta tomorrow, 15 June there is still uncertainty of the issue of illegal sports betting. More specifically, Malta is still vetoing the Macolin Convention. 

A Council of Europe treaty, the Macolin Convention aims to combat the manipulation of sports through illegal betting. Herein lies the problem. To comply with the treaty, Malta-based betting operators would need to honour the laws of the jurisdiction in which specific consumers using online services are based – with the failure to do so meaning it is engaged in facilitating illegal sports betting services. 

Unsurprisingly, the Maltese authorities have long disagreed with this definition of illegal betting, and insist that its own national laws and the Malta Gaming Authority’s sports integrity unit, in cooperation with international sporting and law enforcement organisations, are capable of addressing illegal sports betting and manipulation.

If Malta gets greylisted by the FATF, it will signal to the rest of the world that the country is an untrustworthy jurisdiction, and would spell disaster for the country’s financial services sector. Needless to say, this would make life very difficult for all Malta-based businesses and individuals trying to do business internationally. 

But, on the other hand, if Malta does ratify the Macolin Convention, any operators licensed by the MGA will be forced to scrupulously honour the laws of any other states they offer services in. Anyone familiar with the Maltese gambling industry will know this could cause big issues for many operators, and would likely significantly devalue an MGA license. 

AYO.NEWS says:

Once again, Malta finds itself stuck between a rock and a hard place. Clearly, on every level Malta can’t afford to get greylisted by the FATF, but on the other hand the online gaming and betting industry forms a massive chunk of its economy – even more so since the COVID triggered decimation of its tourism sector. 

With the MGA’s reputation in tatters following the charging of its former CEO, Heathcliff Farrugia, over his links to disgraced tycoon Yorgen Fenech, and the controversial appointment of a close associate of the country’s Prime Minister as Chairman, it’s hard to believe Moneyval or the FATF will put much faith in the regulator’s promises.