Arbiter for Financial Services Alfred Mifsud described 2025 as “a year of record numbers”, highlighting significant increases across the Office’s dispute resolution work.

The Office registered 350 complaints during the year, a 39% increase from the 251 recorded in 2024, while enquiries and minor cases rose by 16.1% to 918.

The number of complaints decided more than doubled, with the Arbiter issuing 192 final decisions compared with 94 the previous year.

Of those decisions, 150 complaints were not upheld, 37 were partially upheld and five were upheld in full. Only 11 decisions, or 6%, were appealed, down from 7% in 2024 and 12% in 2023. Five cases were decided by the Court of Appeal (Inferior Jurisdiction), with the Arbiter’s rulings largely confirmed.

The Office awarded a total of €253,000 in compensation across 39 decisions, with the highest individual award amounting to €27,000. Decisions were issued on average within 42 calendar days of the final hearing or final submissions.

Mediation continued to play a key role in resolving disputes before formal adjudication. A total of 131 complaints were closed through mediation, settlement or withdrawal, including 81 resolved during the mediation process.

During the year, the Office also abolished its €25 complaint fee, making its services free for both complainants and financial services providers.

Fraud complaints remained the largest category handled by the Office. According to the report, these mainly involved two types of scams: fraudulent payment requests sent through fake bank messages, and so-called “pig butchering” scams, where victims are manipulated over extended periods into transferring large sums of money.

In response to the growing number of such cases, the Office issued a technical note in February 2025 outlining how complaints relating to pig butchering scams should be assessed and identifying areas where financial service providers could improve their practices.

The Office said it is also working with the police and Malta’s financial regulator on a national awareness campaign against payment fraud, scheduled to launch in 2026.

A national survey commissioned by the Office found that 58.5% of 600 respondents aged 16 and over had been targeted by a financial scam. However, only 10.1% of those who lost money reported their case to the Arbiter. Among those who did not report, 58.1% said they were unaware the Office existed.

The report also highlights legislative changes introduced on 1 October 2025 that broadened the definition of an eligible customer, allowing more fraud victims to lodge complaints with the Office even if they had no direct contractual relationship with the financial services provider that processed their payment.

The amendment expands the Arbiter’s jurisdiction over fraud-related complaints while clarifying that providers can only be held responsible for their own failings rather than those of other parties involved in a payment chain. The changes apply only to transactions processed on or after 1 October 2025.

Beyond its dispute resolution work, the Office continued its public outreach efforts through social and traditional media, publishing weekly summaries of decisions and consumer lessons every Friday.

The post Financial Arbiter records busiest year yet as complaints surge in 2025 first appeared on The Malta Business Weekly.

Malta possesses many of the ingredients needed to become a leading European business hub. The gap between its current position and its full potential lies not in geography, but in execution.

Singapore is one of the world’s most remarkable development stories. A small island nation of just 734 square kilometres – barely twice the size of Malta – with virtually no natural resources, it transformed itself into a global hub for finance, trade, technology and innovation. Today, its GDP per capita exceeds $100,000. Malta’s stands at roughly half that figure. The question worth asking is whether Malta could pursue a similar trajectory.

The comparison is instructive rather than exact. Singapore and Malta have different histories, geographies and political systems. Yet the parallels are compelling: both are small island states sitting at the crossroads of major trade routes; both rely on openness to international business; both have prospered by looking outward rather than inward. Singapore’s population of six million is nearly 10 times Malta’s 580,000 – yet both have demonstrated that size, when accompanied by strategic agility, can be a competitive advantage rather than a constraint.

Malta already possesses a strong starting position. English is widely spoken. The country operates within the European Union while maintaining a competitive tax framework. It enjoys political stability, a skilled international workforce and a strategic location linking Europe, North Africa and the Middle East. These are not trivial advantages. They are precisely the foundations on which Singapore built its success.

The execution gap

What distinguishes Singapore from its peers is not natural endowment – it has none – but the relentless quality of its delivery. Public services function efficiently. Infrastructure is maintained to a high standard. Regulatory processes are clear and predictable. Businesses can navigate administrative requirements without unnecessary friction. Investors notice these things. Entrepreneurs depend on them. International talent expects them.

Malta’s opportunity lies in closing what might be called the execution gap: the distance between its stated ambitions and the daily experience of doing business here. Road networks that remain congested, planning processes that lack transparency, digital government services that still fall short of best practice – none of these are insurmountable, but collectively they represent a drag on Malta’s competitiveness that no tax advantage can fully compensate for.

The prize for closing that gap is significant. According to the World Bank’s Doing Business indicators, the highest-ranked economies consistently attract greater volumes of foreign direct investment, command higher productivity and retain talent more effectively than their peers. Jurisdictions that combine competitive tax frameworks with efficient regulation do not merely attract more business – they attract better business.

Quality over quantity

The next phase of Malta’s economic development cannot rely simply on attracting more activity. It must focus on attracting higher-value activity. This shift is already underway in tourism, where policymakers are actively moving away from volume-based mass market strategies in favour of higher-spending visitors. The same logic applies across the economy.

The objective should be to deepen Malta’s position as a centre of excellence in financial services, technology, artificial intelligence, digital assets, advanced manufacturing, maritime services, professional services and international headquarters operations. Malta has established credible foundations in many of these sectors. The creative industries – including film production – represent a more recent addition to that portfolio. The task now is to build on these foundations with greater ambition and greater rigour.

To do so, Malta must continue strengthening its reputation for ease of doing business. Investors and corporations seek certainty above almost everything else. Efficient licensing, stable regulation, responsive public administration and a legal system capable of resolving commercial disputes quickly and fairly are not optional extras – they are the baseline expectation of any business destination that aspires to compete at the highest level.

Reputation as infrastructure

Singapore did not become a global business destination through tax incentives alone. It became one because businesses knew they could trust the environment in which they operated. That trust – built over decades through consistent, high-quality governance –functions as a form of infrastructure, as real and as valuable as any port or airport.

Malta has the opportunity to build the same kind of reputational infrastructure. The goal should not be to position Malta merely as a low-tax jurisdiction, but as a highly efficient one: a place where things work, where rules are clear, where commitments are honoured. That is a significantly more durable competitive advantage.

Personal security and quality of life are increasingly important factors in location decisions for both businesses and individuals. In an uncertain world, families, entrepreneurs and international professionals actively seek environments where they can build long-term futures with confidence. Malta can offer this. By investing further in public safety, urban regeneration, environmental quality and community infrastructure, the country can materially strengthen its appeal to the mobile international talent and capital it seeks to attract.

The case for long-term thinking

Achieving this level of ambition requires something that does not come easily in democratic systems: sustained commitment beyond individual electoral cycles. Infrastructure investment, regulatory reform, institutional capacity-building and reputation management are decade-long projects. They require political will that outlasts any single mandate.

This is not an insurmountable challenge. Many of the world’s most competitive small economies have achieved precisely this kind of continuity – through coalition-building, cross-party consensus, independent institutions or some combination of all three. Malta’s political culture will determine which mechanisms are most appropriate, but the need for long-term strategic coherence is not in question.

The global economy increasingly rewards countries that are nimble, efficient and internationally connected. Large nations often struggle to reform quickly. Small nations, if well-governed, can move with a speed and decisiveness that is simply unavailable to economies of continental scale. Malta has demonstrated this capacity for reinvention before – from maritime trade to financial services, from tourism to digital and creative industries. The next chapter of that story could be the most ambitious yet.

The question of will

No country can simply replicate another’s success. Singapore’s model emerged from a specific set of historical circumstances, political choices and cultural conditions. What Malta can adopt is not Singapore’s blueprint, but its animating principles: an unwavering commitment to competitiveness, a high standard of execution, and a clear-eyed understanding of what a small open economy must do to thrive in a demanding world.

The question, ultimately, is not whether Malta has the raw material to become a leading European business hub – it does. The question is whether it has the collective will to pursue that goal with the consistency and rigour it demands – investing in infrastructure, raising standards of public administration, strengthening institutions, and presenting to the world an image that reflects the quality of what Malta genuinely has to offer.

That ambition – a cleaner, safer, more efficient, more innovative Malta at the heart of the Mediterranean – is within reach. Closing the gap between aspiration and execution is the defining challenge of the next decade.

—

Key comparisons: Malta vs Singapore

Land area: Malta 316 km² | Singapore 734 km²

Population: Malta ~580,000 | Singapore ~6 million

GDP per capita: Malta ~$52,000 | Singapore ~$100,000+

Both: EU/Commonwealth-linked, English-speaking, island trading nations at strategic maritime crossroads.

Maria Darby-Walker is a non-executive director and executive coach and mentor

The post Could Malta become the Singapore of Europe? first appeared on The Malta Business Weekly.

APS Bank participated in a panel discussion entitled Regulatory Value Enablers in the Digital Frontier, held as part of Tech Law Seminar 2026 on Wednesday 6 May 2026. Discussions focused on how new European regulations are driving innovation across the financial services sector, helping organisations deliver simpler onboarding processes, stronger security measures and improved digital services.

Head of Development and Innovation Ronald Psaila represented APS Bank, sharing a banking perspective on developments in digital identity, customer onboarding and fraud prevention, and their potential to enhance the customer experience. He also discussed the practical challenges associated with upcoming regulatory requirements, particularly the Payment Services Regulation, highlighting the need for banks to complement customer education with timely interventions and safeguards that help prevent fraud.

APS Bank also participated in the Central Bank of Malta’s annual Forum for Financial Stability, held on Friday 19 June 2026 at Binja Laparelli. The Forum, entitled Financial Stability: Balancing Resilience and Complexity, provided a platform for discussion on emerging challenges and developments shaping financial stability in Malta.

Representing APS Bank, Chief Risk Officer Giovanni Bartolotta contributed to a panel discussion focusing on emerging risks brought about by digitalisation, including third-party risk and EU tech sovereignty.

Corporate Schemes Manager Mark Lamb was a guest speaker at the final Investment Masterclass of the year, hosted by financial coach Patrick Debattista on Saturday 27 June 2026 at the Salini Hotel. Supported by APS Bank, the event attracted its highest attendance to date and covered topics including money management, financial planning and investing. Mr Lamb’s session explored the role of pensions in long-term financial planning, highlighting their tax advantages and encouraging attendees to make them a key part of their financial future.

Through these engagements, APS Bank continues to share its expertise and contribute to conversations that support a more resilient, innovative and financially informed community.

The post Financial stability, digital innovation and financial wellbeing discussed by APS Bank representatives first appeared on The Malta Business Weekly.

Deloitte’s 2026 Global Tax Policy Survey of 1,010 tax and finance leaders across 28 jurisdictions reveals that organisations are facing increased tax complexity, growing compliance burdens, and high upfront costs to reap the benefits of digitalisation. For Maltese businesses, these demands present an opportunity to assess and redesign their financial data and systems’ environment.

“Organisations are contending with a substantial increase in the demands placed on their finance functions,” says Conrad Cassar Torregiani, Deloitte Malta Tax leader. “The survey data shows that 84% of respondents expect more public tax disclosures and reporting in the next two to three years. For Maltese organisations, this compliance trigger should prompt a broader assessment: how can we use this as an opportunity to improve our data quality, implement AI tools, automate processes, and elevate our teams to higher-value work?”

Compliance as a catalyst for financial transformation

The survey identifies compliance and administrative requirements as the single biggest operational impact across all tax policy areas. Almost 40% of respondents cite the rising compliance burden as their primary concern and 84% of respondents anticipate increased public tax disclosures and reporting requirements over the next two to three years.

“The investment will need to be made, the approach will define whether the outcome is a cost or a benefit,” says Cassar Torregiani. “Leaders need to reframe compliance as a transformative opportunity, not as isolated projects, but as a catalyst to improve tax and finance data quality, to enable AI deployment, and identify automation opportunities. Organisations that take a more holistic approach will emerge with efficiencies and advantages that go beyond meeting reporting requirements.”

Eighty-eight per cent of respondents expect to pay more tax as a result of the Organisation for Economic Co-operation and Development’s (OECD) initiatives around ensuring the imposition of a global minimum tax for multinationals, suggesting that the initiative is achieving its intended policy objective. However, although there have been moves towards simplification, such as the introduction of new safe harbours, more is needed with 41% of respondents believing that further simplification of compliance should be a priority.

Mixed news on digitalisation

Most businesses expect to benefit from simpler, more efficient tax administration through digitalisation. Some, though, are experiencing challenges during the transition phase, citing increased costs and complexity – 85% of respondents expect AI-based tax compliance software to deliver positive impacts ranging from improved accuracy to reduced compliance costs, while 15% remain more negative, expecting the main impact to be increased implementation costs.

The key to realising these benefits is avoiding a narrow compliance-focused approach. Organisations that implement e-invoicing, data management systems, and AI tools as part of a coordinated financial transformation will see broader returns. These include improved data quality for strategic analysis, enhanced process automation across finance functions, and the ability to deploy AI tools for forecasting, risk analysis, and financial planning. Relieving finance function staff of repetitive manual work will also create an opportunity to elevate staff to higher-value strategic and analytical work.

E-invoicing presents a case study in this approach. Optimism about its simplification benefits has declined from 40% in 2025 to 36% in 2026, as concerns about implementation costs have increased. However, when integrated into a broader financial data transformation, where the improved data quality needed for e-invoicing data feeds into improved financial systems, analytics, and AI applications, the possible return on investment is elevated. The same holds true for Tax Administration 3.0, the OECD’s vision of seamless digital tax administration, which is expected to deliver positive outcomes by 80% of respondents. However, 19% expect increased costs and complexity during implementation.

Recognising these challenges, policymakers across the globe are pursuing simplification agendas. The European Commission is soon to release a tax omnibus package with the declared objective to streamline compliance and enhance competitiveness of the Single Market. The approach adopted in the omnibus will be closely watched, as it signals how policymakers in the EU intend to tackle concerns around the growing cost and complexity of tax compliance.

Tax incentives are key for the future

As global tax frameworks stabilise, tax incentives are emerging as a primary tool for jurisdictional competition. The survey shows that 57% of respondents note that governments are increasingly using tax incentives to attract foreign talent. The survey also shows that 38% of respondents expect new tax incentives to emerge as global minimum tax frameworks become established, while 57% expect existing incentives to remain valuable.

This trend is relevant for Malta, which has historically relied on tax incentives to provide genuine competitive advantage in attracting both investment and talent. In an environment where governments globally are increasing their use of incentives, Malta’s proposition must be continuously innovated to remain competitive in attracting and retaining high-value-add business activity.

“Tax incentives are increasingly shaping how jurisdictions compete for investment and talent,” says Cassar Torregiani. “Malta’s tax incentive framework can be a genuine competitive advantage. As governments globally increase their use of incentives to attract foreign talent and investment, Malta must continue to innovate to remain competitive.”

For more information visit www.deloitte.com/mt/gtps

The post Deloitte’s 2026 Global Tax Policy Survey finds rising tide of compliance creates opportunity for financial transformation first appeared on The Malta Business Weekly.

New findings presented at the Wellbeing at the Workplace national conference, jointly hosted by Malta Employers, misco and Atlas Insurance, highlight a labour market where wellbeing efforts are continuous and are increasingly shaped by how work is organised, with flexible working emerging as a key response that may support better mental and physical wellbeing, reduce burnout, improve work-life balance and give employees greater control over their schedules.

The research, presented by Lawrence Zammit, founding partner and director at misco, shows that 68% of employees rate their overall wellbeing as positive. However, this positive self-assessment sits alongside continued strain, with 83% reporting they have experienced work-related health or wellbeing difficulties at some point in their careers.

Among the main pressures identified were long working hours which are often necessitated by operational pressures due to lack of staff – 45% of interviewed employees claimed to work more than 40 hours per week and 13% said they exceeded 48 hours. Those working longer hours were more likely to report wellbeing difficulties, underlining the link between time pressure and sustained stress.

Against this backdrop, discussion at the conference focused on a shift in emphasis: from standalone wellbeing initiatives towards the structure and design of work itself. Flexibility, autonomy and hybrid working models are increasingly seen as central to addressing both employee expectations and organisational performance.

Kevin J Borg, director general of Malta Employers, said that: “Flexible work needs to be considered in the context of better mental and physical wellbeing. It can contribute to lower burnout, greater control over schedules, improved work-life balance, higher job satisfaction and lower stress,” he said.

He added that the benefits are also organisational. “Employers can also gain through reduced absenteeism, stronger employee engagement, greater loyalty and increased productivity, because employees are better able to manage personal and professional responsibilities effectively.”

Evidence suggests that many employers are already adapting where the nature of work permits. Additionally, the Malta Employers’ Association survey gathered recommendations from businesses and policymakers on regulating flexibility, drawing on their practical experience. The advice closely mirrors the stand of the association in favour of avoiding regulation and allowing the employer and employee to negotiate directly in accordance with their needs and realities. Companies also called for focus on improved support infrastructure for parents and carers rather than mandating arrangements.

Jackie Attard Montalto, chief HR officer at Atlas highlighted the importance of ensuring HR approaches are grounded in operational reality, with greater involvement of managers in shaping and testing workplace initiatives. She stressed the need for stronger feedback loops so organisations can better understand what is working in practice and adjust accordingly.

Malta Employers president Ivan Refalo added that leadership and communication are central to making flexible models effective, particularly in organisations operating under resource constraints. He emphasised shared responsibility and the need for clarity in expectations, noting that two-way communication is essential for building trust and ensuring flexibility works in practice, supported by appropriate training and guidance.

The event themed, Wellbeing at the workplace – Turning research into practical action, focused on physical and mental health and featured talks covering all aspects of wellbeing at the place of work including flexible and hybrid work practices; managing workload boundaries and burnout; leadership behaviour and workplace culture; mental health support; healthy lifestyles and nutrition, financial wellbeing and awareness; and supporting diverse workforce needs. The event featured a number of panel and roundtable discussions during which a number of industry leaders, both local and foreign, shared their views and insights, highlighting how the consideration of wellbeing is no longer a peripheral workplace feature but should form an integral part of employers’ practical workforce strategy.

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As from May, the European Commission suspended business survey results for Malta (and Estonia), due to changes in partner institutes. Consequently, the Economic Sentiment Indicator, the Employment Expectations Indicator and the Economic Uncertainty Indicator are not available. However, the consumer sentiment indicator remains available, and it improved significantly in May.

Overall, conditions in the property market remain strong. In May, approved commercial permits increased compared with a year earlier. On the demand side, both the number of residential promise-of-sale agreements and the number of final deeds of sale decreased in May, compared with a year earlier.

In May, unemployment expectations, as published by the European Commission, rose to stand above their historical average. The unemployment rate increased slightly to 3.6% in April, and stood above the previous month’s rate and the rate recorded in the same month a year earlier.

Malta’s inflation rate declined in May and stood well below that in the euro area. The annual inflation rate based on the Harmonised Index of Consumer Prices (HICP) declined to 2.1% in May, while HICP inflation excluding food and energy fell marginally to 2.3%. Across the euro area, HICP inflation was higher than that in Malta due to the increase in energy inflation in the euro area. In May, inflation based on the Retail Price Index (RPI) decreased.

In April, the Consolidated Fund reported a surplus compared with a deficit recorded a year earlier, due to an increase in government revenue which outweighed an increase in government expenditure.

The annual rate of change of Maltese residents’ deposits decelerated when compared with March, while annual credit growth was unchanged.

The full ‘Economic Update’ is available on www.centralbankmalta.org/economic-update

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The Gozo Tourism Operators Performance Review 2025, based on a survey of 80 tourism-related businesses conducted in April this year, paints a largely positive picture of the island’s tourism industry. However, it also highlights persistent challenges linked to operating costs, labour shortages and infrastructure.

The report found that 56% of respondents experienced an improvement in business performance during 2025 when compared to the previous year. A further 30% reported no significant change, while only 14% said their performance had deteriorated.

Among the six tourism categories surveyed, tourist attractions and activities emerged as the strongest-performing segment, with 76% of operators reporting better results than in 2024. Tourism and travel services followed closely, with 75% registering improved performance.

On the other hand, food and beverage establishments recorded the highest proportion of businesses reporting a decline in performance, at 22%. Transport and mobility services followed with 20%, while collective accommodation establishments such as hotels, boutique hotels and guesthouses recorded an 18% decline.

The report underlines the importance of international visitors to Gozo’s tourism economy. More than three-quarters of respondents, 77%, said foreign markets had a positive impact on their business performance during 2025. Of these, 45% described the impact as “good”, while another 32% considered it “excellent”.

Tourist attractions and activity providers, including diving centres and cultural attractions, were particularly upbeat about international demand, recording the highest share of “excellent” ratings.

The strength of foreign demand was also evident when operators compared 2025 with the previous year. Most respondents reported that the contribution of foreign markets had improved, while only 13% believed the impact had worsened. The report notes that negative shifts in foreign demand were relatively limited.

Non-collective accommodation providers, including self-catering apartments, villas and farmhouses, reported the most stable situation, with more than half indicating that the contribution of foreign markets remained unchanged from 2024.

Domestic tourism also played an important role, although its contribution was noticeably weaker than that of international visitors.

The survey found that 45% of respondents described the impact of the domestic market as “good”, while 44% rated it as “average”. Just 11% considered local demand to have had an “excellent” impact on their business.

Interestingly, those who awarded the domestic market an “excellent” rating were concentrated mainly within the food and beverage sector, suggesting that local visitors continue to play an important role for restaurants and bars.

When compared with 2024, most operators said the contribution of domestic demand remained stable. Some 68% reported no change, while 23% said the impact of local demand had increased. Only one in ten respondents reported a decline.

The positive performance trends translated into stronger revenues for many businesses.

Three-quarters of survey participants rated their revenue generation during 2025 as either “good” or “excellent”. Specifically, 65% selected “good” and a further 10% selected “excellent”, while the remaining quarter described revenue generation as average.

The transport and mobility services sector stood out as the weakest performer in this regard, with 60% of respondents in that category reporting only average revenue generation.

Overall, revenues improved compared to 2024, with only 15% reporting a decline. Nearly one-third said revenues remained unchanged.

The report attributes part of this improvement to stronger performance during the festive season at the end of 2025.

Perhaps more significantly, the findings suggest that revenue growth was driven by increased demand rather than higher prices. Among businesses that reported higher revenues, 71% said the improvement resulted primarily from an increase in clientele rather than price adjustments.

This indicates that growth was largely demand-led, reflecting stronger visitor numbers rather than inflation-driven revenue gains, the report said.

The survey also examined how businesses perceived the development of their operations over the course of the year.

Most operators reported that their businesses had improved during 2025. Tourism and travel services led the way, with 75% reporting operational improvements. Collective accommodation and tourist attractions and activities both recorded improvement rates of 65%.

Only 8% of respondents reported deterioration in business operations, with transport and mobility services again emerging as the most challenged sector.

Despite the generally positive performance, tourism operators identified several significant obstacles affecting their businesses.

Rising operating costs were by far the most frequently cited challenge, mentioned by around 71% of respondents. The report links this concern to wider inflationary pressures and volatility in international energy and transport markets.

Labour shortages remain another major concern. More than half of respondents identified staff shortages as a key issue, while a similar proportion pointed to difficulties associated with foreign work permits.

These labour-related challenges were particularly acute in the food and beverage sector and among transport and mobility operators.

Infrastructure concerns also featured prominently, with 40% of respondents identifying them as a challenge. Within the transport and mobility category, the figure rose to 60%, highlighting the sector’s dependence on road networks and connectivity.

Additional concerns raised by operators included increasing competition in the non-collective accommodation market and the growing prevalence of day-trippers, which may limit spending on accommodation and other tourism services.

The report concluded that Gozo’s tourism sector maintained a positive trajectory throughout 2025, supported by strong international demand and improved revenue performance. However, it also warns that structural challenges linked to costs, labour availability and infrastructure continue to affect businesses and could influence future growth if left unaddressed.

The post Majority of Gozo tourism businesses saw performance improve in 2025 first appeared on The Malta Business Weekly.

Artificial Intelligence has rapidly become a standing agenda item in boardrooms across the world. Yet while many discussions focus on the technology itself, the more important questions are around leadership, governance and judgement.

The same is true of cyber security. Most directors recognise the threat posed by cyber-attacks, but many continue to view cyber risk as an IT matter rather than a business issue. In reality, both AI and cyber security have become matters of strategic importance that require active board oversight.

Recently, I’ve observed a growing divide between organisations that see technology as a source of competitive advantage and those that view it primarily as a source of risk. The most successful organisations understand that it is both.

For boards, the challenge is not becoming experts in artificial intelligence or cyber security. The challenge is ensuring that the right questions are being asked and that management is approaching both opportunity and risk in a disciplined way. Artificial intelligence offers significant opportunities for businesses of all sizes. It can improve productivity, enhance customer experience, support decision-making and create entirely new products and services.

In Malta, board oversight of technology is bound to become increasingly important. Many of its successful businesses have grown from entrepreneurial, founder-led organisations into more sophisticated enterprises operating across multiple jurisdictions. As organisations scale, the risks associated with cyber resilience, data governance and the use of artificial intelligence will become more significant. The challenge for these companies will be to support innovation and growth while ensuring that governance frameworks evolve at the same pace. This is not about slowing change; it is about ensuring that change is sustainable, responsible and aligned with the organisation’s long-term objectives.

The enthusiasm surrounding AI can sometimes however obscure important governance questions. How reliable is the information being generated? What controls are in place? How are customer data and privacy being protected? Are employees receiving appropriate training? What reputational, regulatory and financial risks might arise if systems fail or produce inaccurate outputs? These are not technology questions. They are board level questions.

Similarly, cyber security is no longer simply about protecting systems. It is about protecting customers, employees, reputation and ultimately shareholder value. When organisations experience significant cyber incidents, the consequences extend well beyond operational disruption. Customer trust can be damaged, regulatory scrutiny can increase, and recovery costs can be substantial. In some cases, the reputational impact can last for years.

Boards therefore need confidence that cyber resilience is being treated as a strategic priority. This does not mean reviewing technical specifications or software architecture. It means understanding the organisation’s most critical vulnerabilities, ensuring adequate investment and testing whether management is prepared to respond effectively if an incident occurs.

One of the most common mistakes I’ve observed is that technology discussions are often delegated to IT specialists. Expertise matters, but boards must avoid creating a situation where only a handful of individuals understand the risks and opportunities being discussed.

The role of the board is not to provide technical solutions. It is to exercise oversight, challenge assumptions and ensure that technology decisions align with the organisation’s strategy, values and risk appetite. This is particularly important for chief executives. Many first-time CEOs are leading organisations through a period of technological change unlike anything previous generations have experienced. They are expected to make decisions about AI, cyber resilience, data governance and digital transformation while simultaneously managing growth, culture, regulation, sustainability and stakeholder expectations.

The best CEOs do not pretend to have all the answers. Instead, they build diverse leadership teams, seek external perspectives and create an environment where difficult questions can be raised openly.

The question therefore is no longer whether artificial intelligence and cyber security should feature on the board agenda. They already do. The real question is whether boards are equipped to govern them effectively. Technology will continue to evolve, often faster than regulation and sometimes faster than organisations themselves. In that environment, competitive advantage will not come from having the newest technology. It will come from having the judgement, leadership and governance to use it wisely. Ultimately, AI and cyber security are not technology issues at all. They are tests of a board’s effectiveness.

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The review examined the frameworks and controls adopted by banks to identify, assess and mitigate these risks, which the regulator described as significant and constantly evolving threats to the integrity of the financial system.

In its letter, the MFSA highlighted a number of supervisory observations, examples of good industry practice and areas where further improvements are expected. The exercise builds on a similar review carried out in 2025 among financial institutions and crypto-asset service providers.

The authority noted that recent reports by the Financial Action Task Force (FATF) point to increasing links between traditional financing methods and emerging digital technologies, as well as growing sophistication among those seeking to evade sanctions and proliferation financing controls.

Against this backdrop, the MFSA said credit institutions must maintain robust and adaptable systems capable of effectively addressing terrorist financing, proliferation financing and sanctions-evasion risks.

Among its key observations, the regulator found that banks generally demonstrated strong alignment with Malta’s National Risk Assessment. It said institutions should continue incorporating both national and supranational risk assessments into their business-wide and jurisdictional risk frameworks.

The authority also stressed the importance of giving terrorist financing, proliferation financing and sanctions-evasion risks distinct consideration within internal risk-management systems, while continuing to apply proportionate and risk-based measures to prevent breaches or circumvention of restrictive measures.

The use of artificial intelligence was another area highlighted in the review. The MFSA said institutions deploying or considering AI solutions should have a clear understanding of how such systems operate, including their limitations, and should maintain comprehensive audit trails of alerts and decisions.

The regulator also underscored the need for ongoing, role-specific training programmes, particularly for employees working in higher-risk areas.

The MFSA encouraged credit institutions to review the findings alongside existing guidance issued by both the authority and the Financial Intelligence Analysis Unit (FIAU), with a view to strengthening their compliance frameworks and maintaining alignment with regulatory expectations.

The authority said insights gathered during the exercise may help shape its future supervisory approach to financial crime compliance.

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The figures emerge from the FIAU’s 2025 annual report published Tuesday, which highlighted the authority’s supervisory, enforcement and intelligence work in Malta’s efforts to combat money laundering and terrorist financing.

The FIAU said it received 10,712 suspicious transaction reports during the year, up from 9,430 in 2024, while carrying out 150 supervisory interventions across financial and non-financial sectors.

The report is themed “Behind Every Euro Laundered Lies a Victim,” which the FIAU said reflects the human impact of financial crime, including fraud, corruption, trafficking and exploitation.

In a statement accompanying the report, FIAU director Alfred Zammit said the authority’s work remained focused on protecting both Malta’s financial system and society from the proceeds of crime.

“Our work is purpose-led and human-driven: every improvement we make, every risk we mitigate, every suspicious report we analyse, serves people first,” Zammit said.

The report also outlines preparations for the European Union’s evolving anti-money laundering framework, including the establishment of the Anti-Money Laundering Authority (AMLA) and the implementation of the Sixth Anti-Money Laundering Directive.

The FIAU said it continued to participate in European discussions surrounding AMLA’s development, while Zammit was appointed vice-chair of MONEYVAL for the 2026-2028 term.

According to the report, fraud remained the most frequently reported suspected predicate offence, accounting for 28% all cases analysed by the FIAU, followed by tax crimes at 8%. 50% of the cases were registered as unknown, as the predicate offence could not be established.

The FIAU said preparatory work carried out during 2025 also paved the way for the introduction of a settlement process in April 2026, which it said would strengthen its ability to pursue timely and proportionate enforcement outcomes.

The report showed that suspicious transaction reports (STRs) have continued to rise steadily over recent years, increasing from 7,323 in 2021 to 10,712 in 2025. The FIAU said the latest figure represented a 13% increase over the 9,430 reports received in 2024.

Drug trafficking, sanctions circumvention and sanctions violations each accounted for 4% of reports.

The report also highlighted a sharp increase in reporting by crypto-asset service providers, which submitted 3,712 reports in 2025, more than double the 1,751 filed a year earlier.

While still among the largest reporting entities, reports from remote gaming operators have steadily decreased since 2022, filing 3,002 reports in 2025, down from 3,670 in 2024, while financial institutions submitted 2,098 and credit institutions 1,082.

In 2025, 67 reports were filed by accountancy and audit entities.

The FIAU said its intelligence work resulted in 4,351 disseminations to foreign financial intelligence units during the year. It also made 450 disseminations to the Malta Police Force, 493 to the Malta Tax and Customs Administration, and 258 to local supervisory authorities and other competent authorities.

On the supervisory front, the authority carried out 150 interventions targeting subject persons across both the financial and non-financial sectors. 32% of these consisted of thematic reviews, while 25% were full-scope onsite inspections.

Other interventions included thematic inspections (11%), targeted inspections (9%), policy and procedure reviews (7%) and supervisory meetings (1%).

As of December 2025, the FIAU was overseeing 2,150 subject persons. These included 562 entities within the financial sector and 1,717 within designated non-financial businesses and professions, including accountants, auditors, notaries, advocates, tax advisors, land based operations, land based casinos, corporate service providers, remote gaming companies, real estate agents and lawyers.

The report also provided an overview of the outcome of appeals lodged against FIAU penalties between 2018 and 2025.

There were appeals involving fines which amounted to €13,138,924 imposed by the FIAU. Between 2018-2025, €7.89 million in penalties were imposed in court revised fines.

The authority’s cash restriction section meanwhile investigated transactions worth €11.6 million during 2025. It received 88 reports and concluded 82 cases. Of these, 38 involved full investigations, while 25 were closed after investigators established that any cash payments involved were below the legal threshold.

Nine cases were resolved through administrative settlement and four were referred to other competent authorities.

The 82 cases concluded in 2025 included 214 persons, 112 transactions, 41 moto-vehicle transactions, 29 sea-craft transactions, 34 immoveable property transactions and eight transactions involving high value goods like antiques and works of art.

11 breaches of high value goods transactions were confirmed, involving transactions valued at €495,500 and a cash component exceeding €171,300.

19 administrative penalties amounting to €49,500 were issued in relation to those breaches in 2025.

Of the 11 breaches in 2025, five were motor vehicle transactions, five were seacraft transactions, and one was an immoveable property transaction.

Beyond its domestic operations, the FIAU said it continued preparing for the implementation of the European Union’s new anti-money laundering framework.

The authority participated in four Anti-Money Laundering Authority working groups covering nine different mandates and attended 38 related meetings, in addition to 36 AMLA network meetings.

The report also highlighted developments within the Centralised Bank Account Register, which provides authorised authorities with direct access to banking information.

In 2025, there were 37 reporting entities. Designated users from authorities who are eligible to access the CBAR directly include the FIAU, the Malta Police Force, the Asset Recovery Bureau, the Commissioner for Revenue, the Sanctions Monitoring Board and Security Services.

By the end of 2025, the register contained information on approximately 1.9 million IBAN accounts and covered a client base of around 1.26 million natural persons and 41,000 legal entities and arrangements.

Usage of the register decreased, with case-by-case searches dropping from 25,000 in 2024 to 21,000 in 2025. The number of designated users authorised to access the system grew from 97 to 118.

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