Casa to Council of Europe body - “Investigate the FIAU and Pilatus Bank”

MONEYVAL, the Council of Europe’s permanent Anti-Money Laundering monitoring body will be sending an evaluation team to Malta this November. The team will be assessing Malta’s compliance with the principal international standards to counter money laundering as well as the effectiveness of their implementation.

PN Head of Delegation David Casa has today brought a number of concerns to MONEYVAL’s attention. In particular with regard to the political capture of the FIAU, the granting of a licence to Pilatus Bank and the circumstances under which the bank has been allowed to continue to hold that license.

Mr Casa made reference to an FIAU letter sent to Pilatus Bank immediately following the resignation of FIAU Director Manfred Galdes.

“Immediately following the resignation of Manfred Galdes the FIAU sent a team for a follow-up on-site inspection. On the basis of this second inspection the then Acting Director miraculously concluded that the issues with the Bank were now closed in view of missing documents having been provided. The suggestion that glaring and deliberate AML violations in May can be rectified by the forwarding of documents in August is laughable”, stated Mr Casa.

That Manfred Galdes had resigned was revealed by independent media on Tuesday 2nd August 2016 but actually occurred ‘with immediate effect’ sometime before the 21st July 2016.  Pilatus was informed a second on-site inspection would take place on 21st July 2016. The on-site inspection was held between the 8th and the 10th August. A letter signed by the Acting Director clearing Pilatus Bank is dated 26th September 2016.

“It is amply clear that this was a whitewashing exercise”, stated Casa.

In addition, David Casa asked for the attention of the evaluation team to be drawn to the leaked FIAU reports calling for police action against Keith Schembri and informed MONEYVAL of the conclusive FIAU report calling for police action into Konrad Mizzi that had been buried by the FIAU since March 2017.

“The FIAU has been usurped. It is now more occupied with weekend press releases and burying information that incriminates their political masters than investigating money laundering”, stated David Casa.  

David Casa called on MONEYVAL’s Executive Secretary Matthias Kloth to share this information with the team which will be conducting Malta’s evaluation under MONEYVAL’s 5th Round Evaluation. Mr Casa requested the evaluation team to pay special attention to the following issues during the on-site mission in Malta:

- The granting of a licence to Pilatus Bank in view of the fit and proper requirements set out under FATF Recommendation 26;

- The circumstances under which Pilatus Bank has been allowed to continue to operate;

- The autonomy and independence of the FIAU;

- The role of Malta’s Individual Investor Programme (passports-for-sale scheme) in aiding the circumvention of OECD Common Reporting Standards and facilitating money laundering and tax evasion through the opening of bank accounts and the acquisition of immovable property in the European Union by third country nationals holding Maltese passports.

Attached please find the letter that MEP David Casa sent to MONEYVAL Executive Secretary Matthias Kloth.

Background

MONEYVAL is a permanent monitoring body of the Council of Europe entrusted with the task of assessing compliance with the principal international standards to counter money laundering and the financing of terrorism and the effectiveness of their implementation, as well as with the task of making recommendations to national authorities in respect of necessary improvements to their systems. Through a dynamic process of mutual evaluations, peer review and regular follow-up of its reports, MONEYVAL aims to improve the capacities of national authorities to fight money laundering and the financing of terrorism more effectively.

The Council of Europe is an international organisation whose stated aim is to uphold human rights, democracy, rule of law in Europe and promote European culture. Founded in 1949, it has 47 member states, covers approximately 820 million people and operates with an annual budget of approximately half a billion euros.