FIAU issues communication on Suspicious Activity Reports

FIAU Reporting Communication

The Financial Intelligence Analysis Unit (FIAU) released a communication on Wednesday, pertaining to Suspicious Activity Reports. More specifically the quality, deletion and automatic reflection of such reports.

The FIAU is the Maltese AML/CFT regulator whose duties include Intelligence Analysis, supervision, enforcement and CBAR Management. The Intelligence Analysis aspect of these duties covers the collation and review of SAR’s submitted by subject persons, prior to enforcement, if necessary.

Collecting Erroneous Report Data 

In order to assess and improve the quality of such reports, the FIAU has started monitoring (As of 1st Jan 2021) the main reasons for report rejection, including:

• Choosing the wrong type of report (SAR/STR etc.);
• XML schema issues: fields are not aligned as needed, incorrect information included etc.
• Documentation is lacking or is insufficient, incomplete or incorrect;
• Transactions Data is lacking or is incorrect or insufficient;
• Any other details of the report are missing, are incorrect, or not coherent.

This information, according to the FIAU, will be used to issue guidance to subject persons in the future in the hopes of increasing quality, actionable reports.

Automatic Deletion

There are also some upcoming changes to how reports are being stored, referred to by the Unit as ‘Data Clean Up’.In accordance with the reporting obligation listed under section 5.5 of the Implementing Procedures part I “any disclosures should be made to the FIAU promptly, meaning that a suspicious transaction report should be submitted on the same day when knowledge or suspicion of ML/FT is considered to subsist by the MLRO”Therefore the FIAU will introduce new rules around deletion of draft reports, from the 1st of March these reports will be deleted 14 days after creation.

The FIAU is requesting that “any draft reports with initiation date before 12 February 2021 are finalised by this date, that they include all needed details of the suspicious activity/transaction, any supporting documentation, business and risk profile information etc. and that the reports are submitted to the FIAU by latest 26 February 2021”.

For example, any report submitted before the 18th Jan and rejected on the 20th will remain editable, with the initiation date remaining the 18th. If this same report is not re-submitted by the 26th February it will be deleted on the 1st March.After the 1st March deadline, any goAML report then drafted will be deleted 14 days from creation if not submitted, meaning subject persons will need to go through the entire submission process again.

New Rejection Rule

The FIAU has  added a new rule as part of its report validation.“This rejection rule ensures that when involved accounts in the schema are marked as being closed in their account status (“status_code”) the date when the account was closed would be required.An example of how closed accounts should be reported in XML is as follows:”