Pilatus Bank’s appeal against a ruling that gave the Malta Financial Services Authority the power to make all its decisions has been thrown out by the European Court of Justice.
The decision was taken in July 2019 in the wake of the arrest and charge of the bank’s owner, Ali Sadr Hashemi Nejad, with breaching US sanctions. The European Central Bank had then ordered that the MFSA appoint a third-party to communicate for Pilatus. Pilatus also had its assets frozen, with its license suspended.
US financial regulator Lawrence Connell was appointed to the role. However, the bank argued that he lacked the necessary understanding of both EU and Maltese law. He was replaced by Robert Ancillieri.
The case against Ali Sadr was eventually dropped and an appeal to reinstate the bank’s licenses is currently underway.
Pilatus argued that the court was distorting the law and infringed on its right to remedy the situation. However, the court agreed with the ECB that the claims were inadmissible.
The other arguments also lacked the necessary detail to justify the overturning of the original decision.
It also ordered Pilatus Bank to pay the costs.
Hasheminejad was initially found guilty of bypassing US sanctions on Iran by using a complex web of companies to funnel $115 million from a Venezuelan construction project to his father, major Iranian businessman Mohammad Sadr Hashemi.
The case against Ali Sadr was dropped over the likelihood of continued litigation over the suppression of evidence that arose after his trial. Several documents were sealed in the case, with blogger Kenneth Rijock claiming that Ali Sadr might have turned informant in a case that could involve Maltese officials.
Publication of the documents could put the issue to bed.
In Malta, Ali Sadr is known as the infamous Pilatus Bank owner with links to high-profile figures under former Prime Minister Joseph Muscat’s administration, with links to magisterial inquiries involving Muscat’s disgraced right-hand man Keith Schembri.
Assassinated journalist Daphne Caruana Galizia wrote extensively on the issue. Her claims that the mysterious Panama company Egrant was owned by Michelle Muscat and documents held at the bank would prove it were dismissed by an inquiry.
What do you think of the decision? Comment below