In a judgement handed down by the First Hall, Civil Court on the 22nd February 2024, presided by the Hon. Toni Abela, the court found that the law granting the Financial Intelligence Analysis Unit (“FIAU”) the right to investigate and impose significant administrative fines on subject persons as a result of certain regulatory breaches violates the applicant’s right to a fair hearing under Article 39 of the Constitution an Article 6 of the European Convention on Human Rights.
The Court declared certain provisions of the Prevention of Money Laundering Act (“Act”) (Chapter 373 of the Laws of Malta) and the Prevention of Money Laundering and Funding of Terrorism Regulations (“PMLFTR”) (Subsidiary Legislation 373.01) dealing with the imposition of administrative penalties null and void and also declared the investigative process as well as the imposition of the fine itself null and void.
The case, Online Amusement Solutions Limited vs The Financial Intelligence Analysis Unit, (Constitutional Case No. 154/22TA), was filed by Online Amusement Solutions Limited (“OASL”) following the imposition of an administrative fine of € 386,567 by the FIAU. OASL’s case was to the effect that the law which granted the FIAU the power to investigate breaches and to impose administrative fines infringed its fundamental human right to a fair hearing given that the law allowed the FIAU to act as an investigator, prosecutor, and a judge.
In its judgement, the court found that the administrative fine imposed should in effect be classified as a criminal sanction, and accordingly OASL ought to have been granted the safeguards afforded in criminal proceedings, including the right to a fair hearing by an independent and impartial court established by law.
The Court found that the FIAU was not an independent and impartial court established by law, and consequently annulled the fine imposed and declared the investigative process to also be null and void. The court also ordered the FIAU and the State Advocate to pay OASL € 20,000 in moral damages.
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