A time-bomb called Pilatus

The Pilatus Bank saga has the potential to develop into much more than damage to the country’s reputation.

An architect and civil engineer, the author is Chairman of Alternattiva Demokratika -The Green Party in Malta. carmel.cacopardo@alternattiva.org.mt , http://carmelcacopardo.wordpress.com

Earlier this week it was revealed that Pilatus chairman Ali Sadr Hasheminejad was, as result of investigations spanning the past six years, arrested in the United States on charges that he evaded US-Iran sanctions by moving millions of dollars from Venezuela through US banks, using a network of banks in order to conceal the Iranian connection.

We were informed that if the charges are proven a maximum sentence of 125 years behind bars is at stake.

Over a number of hours on Thursday, the MFSA removed Ali Sadr Hasheminejad from the Pilatus chairmanship, stripped him of all authority over the bank – including the suspension of his voting rights – and then proceeded to appoint an administrator to take charge of the bank and its assets. It further directed the bank “not to dispose, liquidate, transfer or otherwise deal with clients’ assets and monies”.

At the same time, the media informed us that last month the European Banking Authority ordered a preliminary inquiry into the Malta Financial Services Authority’s supervision of Pilatus Bank. In particular, this should be dealing with the due diligence checks of the €8 million initial capital which Ali Sadr Hasheminejad used to set up the bank. Is it not about time that such an inquiry is held?

Most of us do remember Ali Sadr Hasheminejad leaving the Pilatus offices in Ta’ Xbiex late one evening last year, moving heavy luggage towards his parked car. He was being filmed by a television crew and questioned as to whether he was removing any bank documents from the bank’s vaults in the wake of the Egrant ownership allegations, as well as in view of leaked information regarding the ownership of a number of accounts held at Pilatus Bank and the transfers carried out to and from such accounts.

The involvement of the Azerbaijani dynasty in a number of matters adds further spice to the developing stories.

Coincidentally, the Azerbaijani Republic is interested in cooperation with tiny Malta. Of interest in this respect is a 127word statement issued late in December 2014 announcing the signing of a Memorandum of Understanding between Dr Konrad Mizzi, at the time Malta’s Energy Minister, and his counterpart Natiq Aliyev, as well as a further Memorandum with the State Oil Company of the Azerbaijan Republic (SOCAR). The Maltese press did not cover this event and, moreover, no Maltese civil servants were present to assist the Maltese delegation, led by Prime Minister Joseph Muscat. Everyone had queried this at the time.

This is part of the background which, even if its individual parts were unrelated, is sufficient to blow to smithereens any country’s reputation.

Various investigations are currently in the pipeline, albeit moving at a snail’s pace. At some point in time, hopefully not too distant, we may be able to see which parts of the jigsaw puzzle fit together.

Each investigation concluded, and each report published, shortens the fuse of this timebomb. It can only be hoped that when this time-bomb goes off, it will only destroy those who created it – or who watched its development in awe. Unfortunately, the collateral damage will, inevitably, be substantial.