ECB Closes Scandal-hit Maltese Bank

Frankfurt am Main, Nov 5 (APP - UrduPoint / Pakistan Point News - 5th Nov, 2018 ) :The European Central Bank on Monday revoked the license of Malta's Pilatus Bank, which has been at the centre of a corruption scandal exposed by murdered journalist Daphne Caruana Galizia.

"The ECB's governing council has decided to withdraw the authorisation of Pilatus Bank with effect from today," the Malta Financial Services Authority (MFSA) said in a statement.

The move to shut the bank had been recommended by the MFSA itself, Malta's finance watchdog added.

An ECB spokesman confirmed the decision.

The MFSA had already frozen the embattled bank's assets in March after its Iranian chairman Ali Sadr Hashemi Nejad was arrested in the United States on charges of circumventing US sanctions against Iran.

The US Justice Department accuses Nejad, who was immediately removed as head of Pilatus Bank, of secretly funnelling $115 million (93 million Euros) through the US financial system to Iranian-controlled entities in violation of sanctions.

Maltese journalist Caruana Galizia had linked accounts held at the bank by a number of top government officials to corrupt dealings.

Caruana Galizia was killed by a car bomb in October 2017, and her murder sparked international outrage.

She was facing a defamation suit from Pilatus Bank at the time of her death.

Pilatus Bank is the latest European Union bank to come under scrutiny over alleged corrupt payments, exposing what critics have called the bloc's Achilles' heel: a lack of coordinated efforts to tackle fraud.

Denmark's largest lender Danske Bank is currently being investigated over possible money laundering related to more than $200 billion transferred through the Danish lender's Estonian branch.

In February, US authorities accused Latvia's third-largest lender ABLV of large-scale money laundering with connections to North Korea's nuclear weapons development programme.