The authorities will be looking into reports that banks in Malta were used by the Italian mafia in a massive operation in Sicily that defrauded the European Union of millions of euros in funds for farmers, a spokesman for the Foreign Ministry said.
The public prosecutor in Messina said on Thursday 94 people were arrested in early-morning raids. According to reports in the Italian media, since 2013, the so-called Tortorici Mafia had defrauded about €10 million from the EU.
The operation involved members of the clan falsely claiming they owned plots of land that in reality were owned by the region and local councils. The clan members then tapped EU funding.
The funds reportedly moved through a complex trail of bank accounts, making it harder for the money to be traced. The Italian authorities said some of the banks involved were in Lithuania, Malta, Bulgaria and other countries.
A spokesman for the Foreign Ministry, now headed by Evarist Bartolo, told Times of Malta the reports were being looked into but provided no additional information on the matter.
“Money laundering will be looked into through the relative institutions in a serious manner in cooperation with Italian authorities,” the spokesman said.
Questions sent to both the police have not yet been answered.
Meanwhile, in reply to a series of questions, a Malta Financial Services Authority spokesman said whenever "any report or misconduct by any licensed institution comes to the cognisance of the MFSA, as an agent of the Financial Intelligence Analysis Unit (FIAU) it informs the unit for any appropriate action to be taken".
"The MFSA is bound by confidentiality not to discuss details of any interactions with law enforcement agencies," the spokesman said.
According to the Italian media, the police said that of the 94 people who were arrested, 48 were sent to jail while the rest were placed under house arrest.
In recent years, Malta’s banking sector was placed under scrutiny following the European Central Bank’s revocation of the licence of scandal-hit Pilatus Bank after the bank was implicated in alleged money-laundering breaches.
Another bank, Satabank, also had its licence suspended in recent years, with over 300 reports of suspicious transactions worth in excess of €130 million flagged by global services firm EY since it was entrusted to administer the bank’s assets.