FIAU director Kenneth Farrugia is set to become the MFSA’s new CEO, Times of Malta has learnt.
Farrugia informed staff at the anti-money laundering unit about the planned move last week, having already been interviewed for his new role at the financial regulator.
He will take on the CEO job vacated by Joseph Gavin last year.
Gavin stepped down after a short and rocky tenure at the financial regulator, which included walking out of a Times of Malta interview.
The Irish lawyer was appointed to the financial regulator in July of 2021 on a package reportedly worth €160,000. Gavin himself took over from Joe Cuschieri, who resigned in 2020 for breaching MFSA ethics over a Las Vegas trip with murder suspect Yorgen Fenech.
Farrugia will be following in the footsteps of FIAU chairman Jesmond Gatt, who was appointed MFSA chairman in February.
The FIAU director declined to comment when contacted.
Farrugia was appointed to lead the FIAU in 2017, amid a storm over leaked documents implicating government officials Keith Schembri and Konrad Mizzi in corruption and money-laundering activities.
After earning a rebuke from the EU banking regulator over its handling of the Pilatus case, the FIAU oversaw a plan to bolster its supervision of the financial sector.
Farrugia was among the officials personally credited by Prime Minister Robert Abela for helping get Malta off the FATF grey list last year.
He was also nominated by the US embassy last year for the US state department’s anti-corruption award. The embassy said the award honours individuals who have worked tirelessly, often in the face of adversity, to defend transparency, combat corruption and ensure accountability in their own countries.
Apart from its supervisory function, the FIAU also feeds the police with intelligence on suspected money-laundering activities linked to organised crime, corruption and tax evasion.
Malta saw a flurry of prosecutions over the past two years, many of which were based on leads from FIAU intelligence.
Recent upheavals within the police financial crimes department have seen a notable slowdown in the pace of police investigations.
Ex-FATF chief Marcus Pleyer last December warned against the risks of Malta “de-prioritising” the fight against financial crime, following the country’s successful exit from the grey list.
Pleyer said during a Times of Malta interview that many countries have made this mistake.
“My advice is to seize the opportunity to continue reforms after the greylisting,” he said.
“The process made Malta a much better place when it comes to fighting money laundering. People in key authorities have a much better understanding of the risks and have better structures in place to detect, investigate and disrupt illicit financial flows.”
Police superintendent Sandro Camilleri was appointed to head the police anti-money laundering unit in September.