Malta may have to withdraw its EU sports betting veto in order to pass the Financial Action Task Force’s Moneyval test, conducted due to concerns that the jurisdiction is a financially unsafe area, safeguarding the interests of Europe’s financial and business communities.
The FATF’s decision, based on a report by Moneyval – which serves as the Council of Europe’s anti-money laundering (AML) and anti-terrorist financing unit – is expected on 15 June.
Malta had previously failed the European Union’s strict anti-money laundering standards, facing the threat of being grey-listed as a risky financial jurisdiction, and was subsequently handed a ‘to-do-list’ of relevant criteria to meet and reforms to undertake for the FATF to assess.
As an EU member state, Malta and the MGA must adhere to the mandate of the ‘Macolin Convention’ – a Council of Europe initiative aimed at safeguarding sports from manipulation and corruption. The territory’s adherence to the convention has posed a significant hurdle to the proceedings.
As a consequence of the deadlock, the Macolin Convention has been delayed, due to Malta’s veto preventing the European Commission from signing it on behalf of all 28 EU member states.
So far seven Council of Europe member nations have ratified the Convention, whilst 19 states have signed it, giving it just enough international political support to enter into force.
A ‘senior government source’ on Malta’s adherence to the Macolin Convention allegedly informed MaltaToday that Maltese authorities ‘will probably have to bow our head and just get on with it’.
If fully ratified, the convention would implement further restrictions on the international gambilng industry aimed at countering illegal betting activity, including prohibiting licenced gaming operators in Malta from extending commercial operations overseas unless following the laws of the other member states.
As one of Europe’s most prominent gambling hubs – online gambling accounts for 12% of the island’s GDP, generating €700 million and employing 9,000 people – and providing a base to over 250 betting operators including Betsson, Tipico and William Hill, the new stipulations could have a substantial impact on the day-to-day functions of Malta’s economy.
In the summer of 2019 the MGA was scolded by Italy’s ADM and police anti-corruption taskforce, as its ‘Glassia Investigation’ had uncovered that numerous Malta licensed white-label igaming operators had laundered millions of euros for Calabria’s Mafia, funding criminal activities.
Both the Maltese government and the sports integrity investigators of the Malta Gaming Authority (MGA) have reiterated that they are capable of countering illegal betting in cooperation with law enforcement and sporting bodies.
Additionally, the definition of illegal sports betting has taken a prominent place in the Moneywall investigation, as Maltese authorities currently contest the term, arguing it should refer only to the manipulation of sports competitions within the context of the Macolin Convention.