Almost €20 million in transactions by a former minister “in an EU jurisdiction” raised red flags during checks by the FIAU at a local corporate service provider.
Integritas Consulting was fined €66,000 by the regulator for its “reckless disregard” of the numerous red flags present in certain business relationships.
Its inadequate transaction monitoring could have led to the “unintentional facilitation” of money-laundering, the Financial Intelligence Analysis Unit said.
In a public report, the FIAU zoomed in on the company’s relationship with the unnamed minister, who was facing “serious allegations” in the media of corruption, bribery and misappropriation of funds.
The FIAU found the minister was linked to a “complex” web of loan agreements totalling almost €20 million. It said Integritas should have done more to understand the purpose of these loans to ensure their legitimacy.
The loans should have been scrutinised both when the client was onboarded and throughout the business relationship.
In another example highlighted in the report, a company linked to a prospective €200 million deal had failed to submit audited accounts since 2016 as a result of “accounting discrepancies” over dividend payments.
To date, these critical documents had remained unsubmitted for the past eight years, the FIAU said, although efforts were underway to remedy the issue.
Integritas Consulting surrendered its license to the Malta Financial Services Authority as a corporate service provider in August.
The FIAU said this helped alleviate concerns about the future risk exposures for the company, which is in the process of being dissolved.
Integritas Consulting is owned by Frederic Villa, a Swiss national who resides in Malta.
In February 2023, Villa was among dozens of individuals and companies sanctioned by the United States as part of an effort to target companies and people providing “material support” to Russia’s war efforts in Ukraine.
He was placed on the sanctions list over his role as a director of a Maltese company called Stratton Investment Group.
Villa was also involved in setting up Papaya, a Gżira payment firm that was a focal point in an international investigation into an alleged “Russian-Eurasian criminal network”.
He sold his shares in Papaya in 2016 but stayed on as CEO until February 2023.