Raids on Latvian bank that transferred funds to 17 Black reinforce call for Europol Joint Investigation Team

Raids on Latvian Bank ABLV on Saturday have reinforced calls in Malta for a Europol Joint Investigation Team to look into the assassination of journalist Daphne Caruana Galizia.

The bank is linked to money transfers to 17 Black, the Dubai company owned by Yorgen Fenech who is accused of masterminding the murder of journalist Daphne Caruana Galizia in October 2017.

ABLV was subjected to large scale searches and detentions over the weekend as part of a money laundering probe by Latvian police, according to Latvian news portal LSM.

In light of this, the Daphne Caruana Galizia Foundation has stressed the need for a Europol Joint Investigation Team. Caruana Galizia was investigating 17 Black at the time of her assassination.

“We urge Europe and authorities in Latvia to preserve all evidence from ABLV Bank and to initiate a Europol Joint Investigation Team (JIT) that will pull together evidence from Malta, Latvia, the Panama Papers, and other sources, and bring all those involved in corruption, murder and sabotage of investigations to justice,” the Foundation said in a statement on Sunday.

A Joint Investigation Team is an international cooperation tool based on an agreement between competent authorities – both judicial and law enforcement – of two or more States – established for a limited duration and for a specific purpose, to carry out criminal investigations in one or more of the involved States. In this case, authorities in both Latvia and Malta would work hand-in-hand to tackle cross-border crime.

An established and effective cooperation tool among national investigative agencies when tackling cross border crime, Joint Investigation Teams facilitate the coordination of investigations and prosecutions conducted in parallel across several States.

On Saturday, LSM reported a search of the bank involving 300 law enforcement officers in around 45 locations, as part of an investigation into money laundering of what could amount “to several hundred million euro” according to Pēteris Bauska, the head of the Economic Police Fighting Economic Crime Board.

ABLV Bank was accused by the US Financial Crimes Enforcement Network (FinCEN) of institutionalised money laundering including through its involvement in the Russian Troika Laundromat as well as the Azerbaijani Laundromat – a move that led to its demise.

The now-liquidated ABLV Bank was also named as the bank through which a transfer of $1.5 million to 17 Black was sent. 17 Black is one of two companies allegedly set up to transfer monthly kickbacks to former Tourism Minister Konrad Mizzi and former Prime Minister Joseph Muscat’s chief of staff Keith Schembri, according to leaked emails. The owner of the second company, Macbridge, is as yet unknown.

Since the revelations, Fenech has been arrested and stands accused of masterminding the assassination of Caruana Galizia. He has denied the charges and is currently undergoing court proceedings.

Reuters had revealed that the ABLV account was held by a shell company registered in The Seychelles called Mayor Trans Ltd that was owned by Azerbaijani citizen Rufat Baratzada, who works as a security guard in Baku where he lives in a “modest apartment”. 

Along with Malta’s Pilatus Bank, ABLV was also the focus of a 31-page Suspicious Transaction Report (STR) filed by the family of Caruana Galizia in 2019 on a criminal network they believe is linked to her death with Latvia’s Office for the Prevention of Laundering of Proceeds Derived from Criminal Activity. 

The Caruana Galizia family had linked her death with that of Martins Bunkus, a Latvian lawyer who fought for ABLV Bank to be liquidated involuntarily.

The Shift had also reported that ABLV Bank was offering advice to clients on the merits of obtaining a passport from Malta’s citizenship for cash scheme.

Breaking news from Latvia: One of the most extensive searches in the country’s history is currently being carried out at ABLV Bank. 300 police officers, 46 addresses linked to ABLV Bank. Several persons detained. (currently only in Latvian) https://t.co/O13MmClPIu

— Matthew Caruana Galizia (@mcaruanagalizia) June 13, 2020

Representatives of the State Police confirmed searches were conducted in light of ongoing criminal proceedings for large scale money laundering “both in credit institutions and companies, and in the workplaces and residences of persons”.

A total of 50 criminal proceedings have been initiated against ABLV for possible money laundering, including the main investigation which was launched following the report by FinCEN, which assessed the bank’s actions that “possibly (allowed) the long term and systematic use of the bank’s infrastructure in various ways, and money laundering on a large scale from several countries, such as Ukraine, Azerbaijan and Russia”.

Pilatus Bank had also been accused of laundering money by the same authorities. 

Following FinCEN’s report in February 2018, the ABLV Bank’s shareholders had decided on self-liquidation in light of the reputation problems which came about from the bank’s possible involvement in money laundering schemes.

Months after ABLV Bank’s closure, Pilatus Bank was shut down following a string of controversies in Malta linked to political corruption. Its chairman, Ali Sadr Hasheminejad, was arrested in the US for breaching US sanctions.

The Iranian national was found guilty on five counts of bank fraud and breaching sanctions imposed between the United States and Iran. He was also found guilty of defrauding the US government.

Ali Sadr was due to be sentenced in August and faced a prison sentence of up to 85 years. Yet, in a twist to the plot, the US Attorney informed the court of the government’s decision to drop the case based on issues related to information that the US government had and which it had not disclosed to Ali Sadr’s defence team. A US District Judge issued a strongly worded court order slamming the US government’s behaviour in the case.