Over 80% of breach reports of €10,000 cash restriction rule related to vehicles, property and seacraft

Motor vehicles, real estate and seacraft are the asset classes most reports of breaches of the ban on cash transactions over €10,000 are related to.

A full 83 per cent of all breach reports involve those three asset classes, with motor vehicles making up the lion’s share (45 per cent).

Another 29 per cent are related to real estate while nine per cent are related to seacraft.

Jewellery and precious metals and stones were involved in only three per cent of reports, while antiques were only involved in two per cent of reports.

Another nine per cent involved other high value goods that have not been categorised, while the remaining three per cent of reports were related to goods and services that do not fall under the Use of Cash Regulations.

The figures emerge from the Financial Intelligence Analysis Unit’s (FIAU) annual report for 2023.

The FIAU was made responsible for overseeing compliance with the new regulations, introduced in 2021.

The report includes further insight into the country’s compliance with the law, introduced to reduce the risk of money laundering by limiting cash transactions involving different asset classes to €9,999.

Individuals who contravene the cap on cash purchases will be liable to pay a fine equating to 40 per cent of the sum “paid received, or otherwise transacted in cash” exceeding €9,999.99.

Additionally, beneficiaries of large scale cash transactions may be subjected to administrative charges of no less than €1,000.

The Use of Cash Regulation forms part of sweeping reforms introduced by the Government in the wake of Malta’s 2019 failure in an exhaustive assessment by the Council of Europe’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (Moneyval) on the country’s anti-money laundering regime.

The FIAU report highlights other interesting points about its management of the law.

While it only received three reports of breaches in 2021, this number multiplied ten-fold to 30 in 2022, and further increased to 86 in 2023.

As a result, the policies and procedures were enhanced to ensure that the FIAU’s Cash Restriction Section can conduct effective investigations for every scenario.

Part of these efforts included the introduction, in the last quarter of 2023, of a new type of report known as the Suspicion of Cash Restriction Breach Report.

The new format has been carefully modified to be clear and concise, whilst providing all necessary data required by the section.

Most of the reports received were from banks, amounting to a total of 86 per cent. Another six per cent of the reports of suspicious or known cash breaches were received anonymously through the FIAU website whilst three per cent were communicated internally from other FIAU sections. The remaining five per cent of reports were received from accountants and auditors, real estate agents and lending institutions.