17 Jan 2019
The European Commission (EC) has handled money laundering issues regarding Malta disproportionally compared to Latvia, which had a ‘much more serious case,’ according to EU lawmaker and former Maltese prime minister Alfred Sant.
Malta has been in the spotlight over a number of money laundering and corruption issues in recent years, including the murder of investigative journalist Daphne Caruana Galizia who highlighted government corruption issues.
In recent months, the European Central Bank has withdrawn the banking licence of Malta-based Pilatus bank after its owner was arrested in the United States over financial crime charges.
Still, the EC’s handling of Pilatus and its criticism of Malta is ‘disproportionate,’ said Sant, who said the EC had handled the scandal surrounding Latvian bank ABLV differently.
ABLV was also forced to shut down after the US accused it of abetting money laundering, charges the bank denied.
“In the case of Latvia, the European Commission is carrying monitoring activities and several letters have been sent to the anti-money laundering authorities.
“It has also requested a breach of Union law investigation from the EBA. Latvian ABLV had around $4.6 billion in assets, handled transactions valued at tens of billions of dollars in offshore jurisdictions,” Sant said.
“[However in] the case of Malta … the European Commission had requested preliminary enquiries that lasted two years as well as [an] on-site investigations. It further requested the FIAU to meet and to provide [it] with additional information. It also asked the Maltese authorities to take a number of measures, questioning its methodology, strategy, ability to react as well as its processes for inspections.”
He added that Pilatus’ chairman was accused of funnelling $115 million through US banks, [while] ABLV was implicated in money laundering, bribing officials and facilitating breaking of sanctions against North Korea.
“The United States Treasury’s Financial Crimes Unit has accused ABLV of making money laundering a pillar of the bank’s business practices for a number of years and that the Latvian bank was involved in the theft of $1 billion in assets from fraudulent Moldovan banks.”
The European Commission and Latvian Ministry of Finance did not respond with any comment by press time.
Count this content towards your CPD minutes, by signing up to our CPD WalletFREE CPD Wallet