Investigating legality of every Pilatus deposit and transaction

The Malta Financial Services Authority, together with the Financial Intelligence Analysis Unit, is currently in the process of a thorough investigation of every deposit and every transaction to determine whether any of the assets held in the bank were done so illegally,” an MFSA spokesperson has told The Malta Independent on Sunday.

The MFSA was asked for a reaction to a scathing press release issued by the bank on Friday evening, in which it said the “underlying motivation for this witch-hunt against Pilatus Bank stems from the fact that the bank was chaired by a successful Iranian businessman that the short-sighted and racist politicians of Malta are determined to see fail.”

While the MFSA would not go into the merits of the ‘racism’ charge, it reiterated that it had “acted decisively only when it had a legal basis to do so, following the indictment of Mr Ali Sadr [the bank’s 100 per cent owner) in the US.

“The bank remains solvent, its assets remain frozen and protected, and a responsible person has been appointed by the MFSA to manage the bank’s operations.”

The MFSA added that until the joint MFSA-FIAU is complete “it would not be appropriate to comment further”.

Pilatus Bank said on Friday that it was also “exploring avenues for legal redress in Malta and internationally” after the bank was “destroyed… without

good cause and absent any basis in fact”. Sadr was arrested in the United States in March on charges that he had participated in a scheme to evade US sanctions and funnel more than $115 million paid under a Venezuelan construction contract through the US financial system. He is currently facing 125 years in prison.

On Friday, the bank, which had been at the centre of the Egrant allegations, among many others it should be noted, seized on last Sunday’s publication of the Egrant summary to say it has “completely vindicated Pilatus Bank’s position and continued assertions of innocence. It has laid bare the political machinations that have destroyed Pilatus Bank “without good cause and absent any basis in fact”.

The bank insisted that the findings of the Inquiry “have clearly demonstrated the false and malicious nature of the campaign against the bank, as orchestrated by local politicians and seized upon by the media, and a rush to judgment by the Maltese regulators.

“We reserve our strongest condemnation for the actions of the Malta Financial Services Authority.”

Pilatus accused the MFSA “by its misplaced application of the law, moved to halt the opera- tions of Pilatus Bank, and sought to cripple the bank and its robust operations.

“It is now apparent that the actions of the MFSA have clearly been motivated by considerations which are beyond regulatory affairs for which MFSA is responsible and thus, ultra vires its regulatory powers.

“No other bank operating in Malta has ever been treated in this appalling, discriminatory and heavy-handed manner. The MFSA has acted with a reckless disregard for the financial stability and viability of the bank and it has not paused to consider the interests of its account holders and other stakeholders.”

The bank said that in its view “there can be no doubt that the underlying motivation for this witch-hunt against Pilatus Bank stems from the fact that the bank was chaired by a successful Iranian businessman that the shortsighted and racist politicians of Malta are determined to see fail.

“Individuals among the Maltese regulators have sought to discredit and attack Pilatus Bank by deliberately and maliciously leaking confidential materials and instigating the misuse and misinterpretation of that material in the media.”

The bank also accused the local and international media of having been “complicit in spreading this fake news, without factchecking or providing any balance to their reporting. Pilatus Bank, prior to such reckless actions and attempted frame-ups by certain Maltese politicians and individuals in the regulatory bodies, was among the most successful banks both in Malta and the entire Europe with exceptional reputation and regulatory standards.”

Notwithstanding that, according to the bank, “There has been no attempt by the Maltese regulators to correct the record, and accept their rush to judgment driven by their political affiliations.

“Now that the allegations against Pilatus Bank have conclusively been shown to be unfounded, false and targeted, the stakeholders of Pilatus Bank are exploring avenues for legal redress within Malta and internationally, and will pursue such action imminently and to the fullest extent possible for the tremendous damages caused by such reckless and deliberate misconduct.”