As the leader of a political party, I am considered as a politically exposed person (PEP) in line with the provisions of EU 4th Anti-Money Laundering Directive as transposed into Maltese law. Even members of my immediate family are so considered. Other politicians and their families are in a similar position.
It is held that politically exposed persons (PEPs), by virtue of the position they hold present a higher risk for involvement in money-laundering. There is no practical distinction between PEPs who exercise executive authority and those who have none of it, as yours truly!
The unnecessary, at times repetitive, queries from banks which I and various members of my family receive, are at times very annoying, even though I understand their scope and need if they were to carried out appropriately. At times however, bank officials are overzealous with small fry, and then look sideways when facing the big fish.
It is unacceptable that while monitoring of persons who pose a minor and insignificant risk for involvement in money-laundering is done (at times), with exaggerated zeal, yet those who not only pose a risk, but actually do it manage to avoid any sort of detection by having the right friends at the right places assisting them in meticulously piloting the waters.
The latest money laundering cases in court this week take us from the fish restaurant to the bank and back again. Investigating the money-laundering trail took the police investigators to Marsaxlokk and Valletta fish restaurants. This investigation is apparently linked to another major money-laundering case: the laundering of monies allegedly resulting from the Libyan diesel smuggling operation.
One of the persons arraigned is a former bank official. He is now retired, as emphasised, after the arraignment, by his former employer the bank.
The point at issue is the trail between the fish restaurant and the bank. In fact, reporting on the testimony at the first sitting in the criminal courts the media emphasised that the prosecuting officer, in explaining the background to the investigation carried out, stated that the former bank official, when still in employment as an official of the bank’s corporate banking unit, had allegedly been of assistance in the money laundering operation currently under review. It has been suggested that such assistance helped the alleged money launderers to avoid detection for quite some time.
The former bank official is no longer in the bank’s employment. In the meantime, he had taken a promotion and is now on the books of the alleged money launderer, a Director of his various companies.
What is the role of the MFSA (Malta Financial Services Authority) in all this? This operation was in motion at the time when the Chief Executive Officer of the MFSA was in cahoots with Yorgen Fenech, currently under the criminal spotlight himself, accused with masterminding the assassination of Daphne Caruana Galizia in the Maltese Courts and simultaneously wanted in Sicily as part of a match fixing and illegal betting scandal.
What monitoring do the MFSA and the FIAU (Financial Intelligence Analysis Unit) carry out to ensure that the banks perform their money-laundering regulatory functions diligently?
This week’s police charge sheet seems to indicate that any such monitoring, if at all existent, was very weak and for all intents and purposes ineffective.
The bank official changed his job and moved on from his bank regulatory duties to allegedly managing the laundering of monies generated from the Libyan diesel smuggling operation. This is the logical conclusion drawn from the police charge sheet presented this week on the alleged use of the fish restaurants at Valletta and Marsaxlokk as money-laundering tools.
If the MFSA and FIAU had carried out their duties properly this would not have been possible. This is a clear case where the revolving door recruitment from the regulatory authorities to the money-laundering industry operated under the very noses of the regulatory authorities themselves with no one noticing or bothering about it.
Are the institutions really functioning, as the mess gets bigger every day?
Hopefully the MFSA and the FIAU take decisive action, urgently, for a change.
published in The Malta Independent on Sunday – 18 April 2021