Malta’s Fin-Services sector left reeling in wake of high-profile arrests on money laundering charges

Malta’s business community is in turmoil following recent damning developments in the investigation of Daphne Caruana Galizia’s assassination, the outgoing president of the Malta Chamber of Commerce said.

David Xuereb told sister newspaper Business Today this morning that:

• The arrest and incarceration of a number of prominent individuals – including:
  • The former chief of staff of the country’s former prime minister,
  • As well as a number of financial advisors, accountants and businessmen –
• On charges of money laundering, corruption and fraud, had Maltese businesses worried about what was yet to come.
• “Most worrying is that these developments, and what is surely yet to come, will have a crippling effect on Maltese businesses and their hopes of investing, joining partnerships and enticing foreign businesses to join local endeavours,” he said.

Xuereb said:

• The money laundering charges were particularly damning as Malta had for years worked hard to portray itself as a safe and forward-looking financial services centre of excellence.
• “We are seeing this onslaught of scandals, revelations and legal proceedings because for many years, hardly any action was taken to follow up on reports and accusations,”   
• “My hope is that whatever else is to come, comes quickly.”

The compilation of evidence against Nexia BT partners Brian Tonna, Karl Cini and Manuel Castagna, and the company’s financial controller, started today.

• https://www.maltatoday.com.mt/news/court_and_police/108567/live_brian_tonna_karl_cini_and_associates_in_court_on_money_laundering_charges#.YFxNRy2ZPGL

Proceedings against others, including Keith Schembri, are expected to start tomorrow.

Xuereb said that:

• It was imperative that any necessary action is taken immediately and that all crimes, infringements and conspiracies are uncovered and solved and that any and all guilty parties are identified and punished.

However, once all legal and judicial processes are concluded, it is equally important that the country be in a position to move on.

Xuereb said that:

• Malta’s reputation was nowadays in tatters.
• “Our country and our businesses have lost their ability to develop lasting commercial relationships because foreign investors are now wary of us,” he said.
• the ever-present spectre of the upcoming Moneyval report on Malta was further undermining Malta’s chances of an imminent and swift return to international recognition.
• “That is why it is inevitable that these current developments will cause Malta’s reputation to suffer further under international scrutiny,”  

Anti-money laundering

Possibly the most damning and harmful of recent revelations involves the money laundering charges levied against a number of individuals and companies.

• https://www.maltatoday.com.mt/news/court_and_police/108463/corruption_fraud_money_laundering_charges_keith_schembri_bail_denied#.YFxNjy2ZPGI

BusinessToday reports that the local financial services sector has been left reeling by the recent revelations.

Banks, auditing firms and financial services advisory firms are worried that the recent developments will lead to further controls and increased scrutiny on their AML standards and regulations.

By Paul Cocks, Malta Today, 25 March 2021

Read more at Malta Today

• https://www.maltatoday.com.mt/news/national/108571/finservices_sector_left_reeling_in_wake_of_highprofile_arrests_on_money_laundering_charges?src=ilaw#.YFxsXa_7SUl

• https://www.businesstoday.com.mt/business/business/1375/finservices_sector_left_reeling_in_wake_of_highprofile_arrests_on_money_laundering_charges#.YFxFJbRKiOE