Over 300 reports of suspicious transactions at Satabank worth in excess of €130 million have been flagged by global services firm EY since it was entrusted to administer the bank’s assets by the financial regulator.
The move had followed the suspension of the bank’s licence by the Malta Financial Services Authority in the wake of various money laundering breaches.
Unlike Pilatus Bank which had its licence revoked by the European Central Bank, Satabank was slapped with a €3 million fine by the MFSA.
Satabank’s licence suspension hurt mostly its 7,173 clients who between them had deposits of €311.3 million.
Their accounts were frozen, meaning they were unable to withdraw any money until EY started what is known as a controlled release.
This gradual process, which is still ongoing, had prompted complaints by clients who had not yet received their savings months after the takeover.
A report tabled in Parliament by Financial Services Parliamentary Secretary Silvio Schembri shows that up to September 20 of this year, €121.6 million of funds belonging to 2,342 customers had been released.
€121.6 million of funds belonging to 2,342 customers have been released
This process applied to Malta resident customers with balances between €50 and €15,000 who could submit the required identification documentation and had the funds released immediately through a bank draft or transferred onto an account opened with a credit payment institution within EU/EEA jurisdiction.
A further 984 clients having €70.8 million were in the process of receiving their funds, while 3,619 account holders having €64.2 million still had outstanding documents to present.
It also transpired that 309 suspicious transaction reports worth €131 million from 601 customers were filed.
These customers included a cluster of about 100 entities for which additional individual suspicious transaction reports could be issued on a case by case basis in the process of the control release process.
The report also noted that access to €40.3 million of funds belonging to 55 customers was restricted in the wake of orders by Maltese courts.
The analysis also looks at the way in which the bank’s staff had shrunk following the suspension of its licence. From a complement of 44 employees, the number fell sharply to just 11 by April, forcing EY to make use of external staff in order to be in a position to manage the workload of review cases.
Satabank had been on the regulators’ radar ever since a joint inspection by the MFSA and government’s anti-money laundering agency (FIAU) which uncovered extremely weak safeguards in place.
However, the bank felt hard done by the multi-million euro fine, particularly given the way Pilatus Bank, which last year had its licence revoked by the European Central Bank had escaped any sanction by the FIAU.
Its chairman Ali Sadr Hasheminajad was arrested for alleged sanctions busting in the US on charges of money laundering and sanctions violation.