IGaming companies pressuring MFSA to find them an alternative to Satabank
iGaming companies using Satabank’s services have been piling pressure on the Malta Financial Services Authority to find them an alternative banking solution, and the MFSA responded late yesterday by saying that a “controlled process was underway for the return of customer deposits” over an undefined “period of time”.
Sources close to the MFSA told this newsroom yesterday that the companies are insisting with the MFSA that since other local banks do not accept iGaming companies as clients, a replacement for Satabank’s services was essential in order for them to continue operating.
But the MFSA yesterday instructed Satabank customers that, “if they not have an alternative account (with a credit or payment institution) in an EU/EEA jurisdiction, they are encouraged to set one up as soon as possible”.
Sources said that since the gaming companies’ assets and funds held at Satabank have been frozen, they are unable to issue payments to their clients or their employees. iGaming companies are risking losing clients and, as a result, reputational damage could easily ensue.
The latter is of concern considering the importance of the sector to the Maltese economy. According to recent figures, the iGaming sector contributes €1.2 billion to the Maltese economy, equivalent to 12 per cent of the country’s gross domestic product.
The MFSA said yesterday that, “The Authority has directed the Competent Person to initiate a controlled process for the return of customer deposits over a period of time.
“The release of funds will be subject to certain controls and checks following which, funds may be transferred.
“This process will require Satabank customers to verify their identity and provide additional information and details of another account with a credit or payment institution in an EU/EEA jurisdiction in the same name as the existing account at Satabank to which monies can be transferred.
“If a customer does not have an alternative account (with a credit or payment institution) in an EU/EEA jurisdiction, they are encouraged to set one up as soon as possible.
“The relevant authorities are agreeing the process and further guidance will be provided by the Competent Person on the bank’s website as soon as practical, although this is likely to take several weeks. The Bank continues to meet all capital and liquidity requirements.
“This measure shall remain in force until such time as the MFSA shall otherwise direct and shall be without prejudice to any further regulatory action.”
This, however, will provide meagre solace for businesses still unable to make payments after last Saturday the Paceville Satabank branch was closed after MFSA announced that it had ordered the bank to stop all account movements. This left the bank’s clients unable to access their accounts.
This newspaper yesterday published an article to the effect that clients of Satabank were not allowed access to their money. A statement issued by Satabank yesterday afternoon clarified that, “Satabank customers now have read-only access to view their online account balances. There remains no access to submit transactions, make withdrawals or close accounts. We will continue to provide updates as soon as we are able to.”
The Ernest & Young (EY) auditing firm earlier this month was appointed by the MFSA as the competent body to advise and monitor Satabank in the proper conduct of business. This measure was taken after a joint inspection by MFSA and the Financial Intelligence Analysis Unit found a number of shortcomings in the bank’s anti-money laundering procedures.
iGaming clients who spoke to this newsroom said that after this incident they fear their businesses are on the verge of closing down since they can’t access or move their funds, or manage their own assets.