Updated with PL's reaction at 8.30pm

An investigation into money laundering by an international firm had stopped abruptly, an inquiry has confirmed.

The inquiry did not establish that the investigation was stopped when Dr Fenech Adami's name cropped up but said this could not be excluded. This allegation had been made by MaltaToday last year.

The board called for a more thorough review and investigation by the competent national authorities.

Based on this recommendation, the Prime Minister has requested the police and the Financial Intelligence Analysis Unit to investigate further.

Asked for his reaction, Dr Fenech Adami said that it was clear that the allegations that had been made in the past months were all baseless.

"The inquiry established that I never got involved in the Attorney General or police operations or that the AG stopped any investigation because of me... It shows that I never used my political clout to stop any investigation," he said.

He said that the balloon the Prime Minister had been blowing exploded in his own face. "This is not the first time that the Prime Minister threw mud and lied without proof in my regard and this has been confirmed by the courts," he said.

In a statement, the Labour Party said the inquiry concluded that the investigation had stopped abruptly and this was at a time when Dr Fenech Adami was parliamentary assistant in the Office of the Prime Minister, who was responsible for the police.

The inquiry, the PL said, confirmed that the investigation had become “a very hot potato” which could have had unpleasant circumstances on who tried to tackle it. It also noted that important transactions had disappeared from file.

If the Opposition leader wanted to be believed about political responsibility, he should understand the gravity of the report and say what steps he would be taking against Dr Fenech Adami.

The government had tasked a board of inquiry made up of three former judges to look at four central allegations:

* that a public authority withheld information it had in its possession;

* that the authority did not cooperate with the Dutch authorities investigating this case;

* that a company in Malta made suspicious monetary transactions; and

* that certain institutions did not carry out their duty to investigate an illicit activity.

The inquiry cleared the Attorney General’s office from any wrongdoing and noted that the police force had cooperated with the AG.

Information, the inquiry noted, had not been withheld from the Dutch authorities but the police had information which had not been requested and which they did not pass on.

The board said it could not establish whether the Financial Intelligence Analysis Unit had examined the content of a Dutch freezing order and whether it had done its duties.

The inquiry report and the Prime Minister's letter to the police commissioner can be read in the PDF links below.