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ARTICLE · 22 DECEMBER 2021

Balancing Financial Inclusion And De-Risking

Camilleri Preziosi
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Subject persons are often faced with deciding whether to terminate a business relationship (derisk) or introduce mitigating measures that reduce money laundering/terrorism financing ("ML/FT")...

MaltaFinance and Banking
Luke Mizzi
Luke Mizzi
Peter Mizzi
Peter Mizzi
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Subject persons are often faced with deciding whether to terminate a business relationship (derisk) or introduce mitigating measures that reduce money laundering/terrorism financing (“ML/FT”) risk and cater for financial inclusion.

The FATF refers to de-risking as the phenomenon of financial institutions terminating or restricting business relationships with clients or categories of clients to avoid, rather than manage, risk in line with the FATF's risk-based approach. Persons or entities who do not have access to the controlled financial system may resort to using less regulated or unregulated channels, thus increasing the risk of ML/FT due to a lack of control over transactions.

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