Alfred Zammit appointed FIAU director despite track record

Sean Montebello - 22. December. 2023

Alfred Zammit, former deputy director at the Financial Intelligence Analysis Unit (FIAU), who gave a clean bill of health to Pilatus bank despite money laundering deficiencies and who led the unit’s unjustified dismissal of one of its investigators, was confirmed as director of the unit on Wednesday.

Zammit had served as the FIAU’s acting director since April when former director Kenneth Farrugia was appointed CEO of the Malta Financial Services Authority (MFSA) and later reappointed to the FIAU as chairman.

Zammit’s appointment comes despite a track record of inaction by the anti-money laundering unit, which in part led to Malta’s greylisting by the international Financial Action Task Force (FATF) between 2021 and 2022.

Under Farrugia and Zammit’s watch, the FIAU also imposed heavy fines on financial services practitioners. Several subsequent cases in front of the Court of Appeals have found the FIAU’s modus operandi unconstitutional, resulting in more than €1.3 million in lost fines, calling the unit’s effectiveness into question.

Upon his appointment, the board, led by Zammit’s predecessor and former boss Farrugia, claimed it had “assessed the suitability of five candidates who applied for the position, and following careful consideration, unanimously agreed” on Zammit’s appointment.

In a statement accompanying Zammit’s appointment, the board said, “he is very well regarded and respected within the international AML/CFT community” and “also highly regarded by the community of industry stakeholders in Malta.”

The board’s statements clash with Zammit’s track record, who, in 2016, following a raft of money laundering-related issues at the now-shuttered Pilatus Bank, issued a clean bill of health in a letter to the institution, burying investigations for years.

Pilatus Bank was brought to the public’s attention following reports by assassinated journalist Daphne Caruana Galizia that it was a money laundering machine. Following inaction and obstruction from Malta’s police force, investigations by the watchdog European Banking Agency eventually led to it closing down.

The FIAU’s new director also led the 2017 dismissal of former FIAU investigator Jonathan Ferris, which the Industrial Tribunal found to be unjustified earlier this year.

Upon his dismissal, Ferris claimed his dismissal was due to ministerial interference by former Finance Minister Edward Scicluna. In testimony at the Caruana Galizia public inquiry in 2020, Zammit maintained Ferris was justifiably fired and dismissed claims of collusion with former assistant police commissioner Ian Abdilla to bury investigations into disgraced former minister Konrad Mizzi.

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Mark Debono

2 years ago

Yet another puppet put in place to cover up rampant corruption carried out by the people’s God’s?

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Mick

2 years ago

All part of the Maltese Mafia plan to isolate and dominate from the real world, a total subservient incompetent individual who has all the Gahan requirements for such a position, God help us.

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James

2 years ago

Just another day to ensure the ? untouchables? remain just that.

And the electorate buy into it hook, line and sinker!

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makjavel

2 years ago

Because of their track record .
This government puts lackeys in charge , to guarantee servile and blind loyalty.

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Godfrey Leone Ganado

2 years ago

Alfred Zammit had given Pilatus Bank a clean bill of health and reported that the shortcomings did not persist. This was two weeks after Manfred Galdes had given the bank a damning report.
Since then, on 21 March 2018 the MFSA removed Ali Sadr and appointed Mr Lawrence Connell as competent person to take charge of all assets of the bank and to assume control of it until such time as the MFSA may decide. Mr Connell was followed by a string of another three competent persons who reported every six months to Parliament through the Minister of Finance the last report being made for the period January to June 2022.

The main findings of the competent persons were:
1. Extensive IT work had to be carried out to update the Bank’s records.
2. The audits of the Bank by KPMG for 2018, 2019 and 2020 were always considered as being near completion, however to date none have been finalised and filed with the MFSA. Obviously those for 2021 and 2022 are also still pending.
3. On 2 September 2021, the Bank was arraigned before the criminal court on accusations of money laundering offences.
4. On 31 August 2021 the Competent Person was notified of the outcome of the compliance visit and this resulted in an imposed administrative penalty of ?4.975 million on the bank.
5. On 2 September 2021 the Bank was arraigned in Court on accusations of money laundering offences and the Court of Criminal inquiry acceded to a request by the prosecution for a freezing order over all the assets of the bank and all assets held by the bank.
6. On 10 January 2022, the Competent person replied to the legal Counsel of a borrower of the Bank who requested the repayment of a loan before its maturity on 18 August 2018 and the release of the relevant charge over the property situated outside Malta.
Extensive correspondence was exchanged with the legal advisors and the MFSA for the early repayment sought.
TO DATE THIS MATTER IS STILL PENDING AND THE RELATIVE LOAN HAS NOT YET BEEN SETTLED.

FIAU DIRECTOR ALFRED ZAMMIT –
1. How can you be considered ‘fit and proper’ for your post when all the above was happening under your nose and instead of taking action you clearly looked the other way to seemingly appease and serve your appointee and the Labour government’s vested interests?
2. Can you please inform us of the underlying loan details and those of the loanee of the outstanding Pilatus Bank loan and of the pledged property registered overseas as well as the reason why the MFSA
refuses to authorise the settlement of this loan?
3. Finally, can you inform us why the audited financial statements for 2018, 2019, 2020, 2021 and 2022 are still outstanding, and also if the auditors are refusing to sign the audit report?

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Godfrey Leone Ganado

2 years ago

5 candidates were assessed for their suitability and Alfred Zammit was the preferred candidate.
Obviously he was considered to be the most durable tampoon for Joseph Muscat’s and Robert Abela’s corruptive practices through Pilatus Bank.