European Central Bank revokes licence of Pilatus Bank

The European Central Bank has revoked the licence of Malta’s Pilatus Bank after its chairman was arrested in the US on money-laundering charges. Malta’s Financial Services Authority announced the move, saying it had called on the ECB to take action.

BBC reports “Journalist Daphne Caruana Galizia, who was killed by a car-bomb a year ago, accused the bank of processing corrupt payments. The EU has been investigating the bank ever since her murder. However, it was not until March that the Maltese authorities froze the bank’s assets, following the arrest of its chairman, Ali Sadr Hashemi Nejad.

According to an indictment filed in a federal court in Manhattan, he is accused of involvement in a scheme to evade US economic sanctions against Iran. The Maltese FSA recommended withdrawing the bank’s licence in June, but the process took longer than expected because of legal obstacles, the ECB has said.”

The Malta Independent reports that in a statement, the Malta Financial Services Authority on Monday said that further to the authority’s proposal to the European Central Bank to withdraw the authorisation of Pilatus Bank as a credit institution, the ECB’s Governing Council had decided to withdraw the institution’s authorisation with immediate effect.

On Sunday The Sunday Times of Malta reported that the ECB would be closing down the controversial bank, some eight months after the Maltese watchdog started winding down its operations.

Pilatus Bank’s directors on Monday were notified by the European Central Bank that its license had been revoked, two years after it was first implicated in alleged money laundering breaches.