The smallest EU State, Malta was the first European Union state ever to be greylisted. The FATF grey listed Malta in June 2021. In 2014, the Malta Financial Services Authority (MFSA) had issued a banking license to Pilatus Bank. There was no reason for Pilatus Bank to be refused a banking license when it applied for one, Andre Camilleri, the then-director-general of MFSA, said in courts. Pilatus Bank had its license revoked by the European Central Bank (ECB) in 2018 after the bank’s chairman, Ali Sadr Hasheminejad, was indicted on money laundering charges in the U.S.
“Had we had the slightest doubt about the legitimacy of its operations, rest assured that it would not have been given a license,” Andre Camilleri (pictured left) said in court. He was testifying at the public inquiry into the assassination of Daphne Caruana Galizia. Camilleri was the MFSA’s director-general when Pilatus received a license in 2014 and retired later that year.
Camilleri said that the MFSA had appointed a foreign firm to vet the bank’s application and argued that obtaining a license was “just step one” in the compliance process.
The former director-general said that although surprise inspections were not generally the rule, an inspector could “go and knock at the bank’s door and demand documents.” Inspectors tasked with assessing banks had to show up with a list of documents they required, Camilleri said. He was speaking in reply to questions about previous testimony. The inquiry heard that Pilatus Bank had insisted that missing documents had always been there but that FIAU inspectors had not asked for them.
In 2014, Andre Camilleri was appointed to the European Central Bank’s Administrative Board of Review. This raised many eyebrows, years later, when the scandal of Pilatus Bank hit the headlines. Malta’s FIAU has been making the wrong headlines over the past years. In September 2016, after an FIAU inspection earlier that year had highlighted a series of shortcomings in the bank’s operations, the FIAU’s acting director, Alfred Zammit, wrote a letter claiming the issues highlighted in the unit’s May letter had been closed.
The Maltese media has asked for Alfred Zammit to be investigated. However, to date, he still holds the position of FIAU’s deputy director. FIAU’s director Kenneth Farrugia and his assistant Alfred Zammit did not investigate Joseph Cuschieri and Edwina Licari’s Las Vegas trip with Yorgen Fenech, the alleged mastermind of the murder of Maltese journalist Daphne Caruana Galizia. They also failed to investigate Pilatus Bank, according to Moneyval.
