Pilatus Bank Has Been Forced To Close Down: How Malta And The World Reacted
Pilatus Bank today had its license officially revoked by the European Central Bank in light of its owner’s arrest in the USA for alleged sanctions dodging and money laundering.
The Malta Financial Services Authority said in a statement that the ECV’s Governing Council had agreed to its recommendation and had withdrawn the bank’s license as a credit institution.
The Ta’ Xbiex investment bank became a household name last year when now-murdered journalist Daphne Caruana Galizia claimed it was being used by Azerbaijan’s ruling family to launder money to the Panama company Egrant – which she claimed belonged to the Prime Minister’s wife Michelle Muscat.
While a magisterial inquiry found no evidence to back up this claim, two separate inquiries into how the Prime Minister’s chief of staff Keith Schembri had allegedly used the bank to launder money remain ongoing.
The bank’s closure was widely reported in the international press, with the BBC noting it had been at the centre of several reports by Daphne Caruana Galizia into alleged money laundering.
The Guardian pointed out that, at the time of her murder, Caruana Galizia was being sued by Pilatus’ owner Ali Sadr Hasheminjad in a US court for malice, defamation and for causing damage to the bank’s “reputation and actual and prospective economic relationships”.
Reuters recounted how a European Banking Authority investigation into the Financial Intelligence Analysis Unit (FIAU) had flagged serious shortcomings into its oversight and regulation of the bank.
Meanwhile, the Financial Times reported that the withdrawal of Pilatus’ license will draw attention to Bank of Valletta where Pilatus had deposited its initial share capital of €8 million.
“Bank of Valletta has a strict policy of due diligence which it applies to all accounts opened by the bank,” a BOV spokesperson told the FT in response to a request regarding Sadr’s funds held at the bank.
Veteran BBC journalist John Sweeney recounted how Pilatus’ law firm Schillings had said “lots of nice things” about the bank in a warning letter to him, but that this was “all bollocks”.
La Repubblica journalist Carlo Bonini, a protagonist in the Daphne Project consortium, said that Joseph Muscat was “the friend and protector” of Ali Sadr.
In Malta, former PN leader Simon Busuttil said the bank’s closure came two years too late.
“Meanwhile, Malta’s name has been tarnished and the people who pushed for this bank to be given a licence and even had bank accounts there are still running our country,” he tweeted.
PN MEP Roberta Metsola tweeted that “one cog in the wheel is finally done” and that “slowly but surely, justice will be done”.
PN MEP candidate Michael Briguglio questioned why the authorities took so long to close the bank and warned that Malta “cannot afford to lose the reputation it built during the years”.
Activist group Occupy Justice noted that several media houses worldwide had removed stories about Pilatus after they were threatened with legal action, but Daphne Caruana Galizia had refused to do so.
Fellow activist group Il-Kenniesa said today would be “a day of victory against corruption” had Malta’s institutions been functional.
“Pilatus Bank closed and Daphne would be writing about it. But she’s gone. She’s gone because of the lack of independence and incompetence from Malta’s authorities,” it said.
The late journalist’s son Matthew Caruana Galizia said the bank’s closure adds weight to his family’s longstanding call for a public inquiry into the murder.
“An Iranian bank in Malta used for racketeering by Joseph Muscat’s inner circle threatened my mother and threatened newspapers,” he said. “The newspapers complied, my mother did not. Now the bank is shut down, my mother is gone and the newspapers are still weak. We need a public inquiry now.”
His brothers Andrew and Paul also issued tweets, similarly stating the bank’s closure lent to their mother’s reports about alleged money laundering within it.
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