Satabank has been fined an administrative penalty of €60,500 after it was found to be in breach of risk management laws as outlined in the Banking Act, but sources confirmed this is unrelated to an ongoing probe.

The penalty was announced last week by the Malta Financial Services Authority, which found a number of governance failings.

Article 17 of the banking law, which the MFSA said Satabank had breached, stipulates that every credit institution should have in place “robust governance arrangements which include a clear organisational structure with well defined, transparent and consistent lines of responsibility”. According to the same article cited by the watchdog, banks must also ensure “effective processes to identify, manage, monitor and report the risks”.

Satabank now has 30 days to appeal the decision.

The administrative penalty against Satabank comes as financial investigators carry out an extensive audit of its client files.

The Sunday Times of Malta reported last month that both the MFSA and the Financial Intelligence Analysis Unit are carrying out an on-site examination at the bank’s St Julian’s headquarters. An audit firm was also called in to help the investigators scrutinise the bank’s compliance with anti-money laundering rules.

Sources who spoke to this newspaper, however, insisted that the penalty imposed last week had nothing to do with the audit currently being carried out by the MFSA and FIAU as this had not yet been completed.

The authorities will only see that any action against the bank is warranted after the audit has been completed.

This is not the first time Satabank has been in the headlines since receiving its licence in 2014.

Last year, the bank was named by a Sicilian prosecutor as having been used by fuel trader Gordon Debono to receive illicit payments through his Maltese company Petroplus Ltd, as part of an alleged €30 million fuel smuggling ring.

In March, Satabank told this newspaper that the selection and on boarding of new clients was being subject to stricter criteria, to reflect the bank’s risk appetite and remain consistent with regulatory ratios.

claire.caruana@timesofmalta.com

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