The public inquiry on the assassination of journalist Daphne Caruana Galizia continues this afternoon. Alfred Zammit, FIAU Deputy Director and Marianne Scicluna are expected to testify in court. Ms Scicluna is the Chief Officer Supervision within the Malta Financial Services Authority, MFSA.
During the last sitting in court, Former Police Commissioner Michael Cassar and Former MFSA Chairman testified. Cassar testified behind closed doors. In his testimony, Joe Bannister said that he wanted to be out completely and that is why he asked to retire than just resign from his post. He also testified that if reports, regarding the alleged money laundering by Pilatus Bank, were handed to the FIAU or police, he was not privy to them.
The public inquiry will continue on Wednesday at 2 pm. Thank you for following this blog.
Asked if the European Central Bank had issues with Pilatus Bank to be given a licence to operate, Marianne Scicluna asked to testify behind closed doors.
Scicluna testifies that MFSA wanted to carry out an inspection in May but received the go-ahead in November due to investigations and inquiries underway.
"We had encountered problems with certain Police inspectors as they were not comfortable doing on-site visits at Pilatus Bank. Reason being that the case was closely followed by the media" – said Scicluna. Then explained how MFSA decided the inspections still had to be conducted. This led to the resignation of a banking inspector. Then says a forensic analysis on Platus Bank was conducted.
Marianne Scicluna explains how MFSA used information being published on Daphne Caruana Galizia's post. Said that most of the details published in her blog were correct.
She says that the usually a bank has to provide the MFSA with a report every quarter of the year and in the case of Pilatus Bank MFSA followed things more closely.
She says a top-down inspection was carried out and the MFSA noticed that certain criteria/regulations were not in check with Pilatus Bank. The information gathered by FIAU was shared with MFSA.
Marianne Scicluna mentions how an on-site visit was carried out after they had noticed certain changes within the bank possibly linked to growth. She adds that before on-site visits are done they usually inform the company/entity.
Scicluna replies that Ali Sadr had experiences related to financial services and that he had people working for him who had work experience related to banks.
Marianne Scicluna continued saying that the intelligence report was conducted by a British company since Ali Sadr is Iranian and Iran is considered as a high-risk jurisdiction. She is questioned about his experience as a banker.
The process to issue the licence took almost 9 months and the due diligence wasn't carried out by KPMG explains Scicluna.
Scicluna says that KPMG was involved in the on-site visit of the Pilatus Bank and was also involved in the Bank's application.
Marianne Scicluna said that Pilatus Bank had formally approached MFSA in September 2012. There were meetings before they filed their application which was then received in February 2013.
Scicluna explains how the MFSA sends information to FIAU related to compliance and other aspects/issues of great relevance to the Unit (FIAU) and in this case, they had relevant findings to report to FIAU.
According to Scicluna, the FIAU is still investigating the case.
Ms Scicluna explains how the MFSA is responsible for bank regulations and insurance companies amongst others. She then mentions companies; BT International and BT Management. She said they used to work within jurisdictions considered by MFSA as high risk.
She says that as a member of the council she occupied two roles. Lawyer Comodini Cachia asks Scicluna if MFSA ever took action against persons in the public life. Scicluna replied yes but no action was taken in relation to those mentioned in Panama Papers.
She then says that the Supervisory Council within the MFSA does not exist anymore.
Scicluna says that there was a time were the MFSA used to go to on-site visits on behalf of FIAU and there were also times where the on-site visits used to be carried jointly between FIAU and MFSA.
Scicluna says she has been working at MFSA since 1995 and now is the Chief Officer Supervision.
Next to testify in court od Ms Marianne Scicluna.
Alfred Zammit is testifying behind closed doors. Journalists are asked to exit the courtroom. In the meantime, on social media Russian whistleblower Maria Efimova described what Zammit testified in court as "a joke".
Zammit says that he does not have a copy of this document. He then says that it was a mistake from FIAU to employ Ferris. " He was a horrible manager" and that at a certain point action needed to be taken.
Zammit says that he was surprised that Ferris said that he did not know why he was sacked from FIAU. Zammit says that on the 2nd of July 2018, the FIAU presented a document including all the reasons why Ferris was sacked. The document included 25 reasons.
Zammit says he wished to testify regarding what Jonathan Ferris testified in court last week as part of this inquiry.
Regarding Panama Papers, Alfred Zammit says that FIAU did all the necessary in its investigations. Then mentions how recent improvements have been made in the way FIAU works.
Zammit is to testify in court about when the FIAU knew, businessman Yorgen Fenech as the owner of 17 Black. But will do so behind closed doors.
He says that during the course of the investigation the FIAU used information published in Daphne Caruana Galizia's blog and information published by media outlets.
He says that he thinks he had discussed the four documents with Ian Abdilla but does not recall the details of their discussion. He also mentions how there had been meetings after office hours. He then mentions how a photo captured from a CCTV camera showing him carrying a red file was leaked. He says that the file he was carrying was not related to an investigation on Konrad Mizzi.
Alfred Zammit says he is ready to give the information to help the inquiry move a step ahead if he is given permission to testify behind closed doors.
Zammit then says that more investigation is being carried on Pilatus Bank and that the Bank was asked to provide all its information.
According to Lawyer Comodini Cachia, Pilatus Bank was given a clean bill of health despite that in one of the letters there were significant documents which were not available during the first on-site visit.
An article published in Illum newspaper is presented in court to Zammit. With this article, a document is attached. Zammit says he can recognize a few details such as his signature on a number of letters.
He says he felt disappointed that the findings found in the 2nd on-site visit to Pilatus Bank did not get in their hands first time round.
Asked who was on the compliance monitoring committee, Zammit says he does not remember. He also says that the FIAU was very much concerned about Pilatus Bank however they did not have enough findings/information against Pilatus Bank which could permit them to take action.
Lawyer Comodini Cachia then asks Zammit why he informed Pilatus Bank that Manfred Galdes had resigned. He replies that he did so because Galdes had already started communicating with the bank.
Comodini Cachia presents a letter signed by him, Alfred Zammit and which was sent to Pilatus Bank. In this letter, Zammit informs them of the clients who were being investigated by FIAU.
According to Zammit, the FIAU went into all PEPs which have or might have connections with Pilatus Bank. Says they were not aware of the dual filing system adopted by Pilatus Bank and that it is not an estranged system.
The first compliance visit at Pilatus Bank was in March 2016 and the second compliance visit was in August 2016. The first visit took over 5 days to be completed so it was not a matter of a one day visit to Pilatus Bank.
He could not confirm whether the additional information that FIAU found out about in the 2nd on-site visit was already there. Then says that procedures followed by FIAU in 2016 were not rigours enough.
According to Zammit, during that meeting, Manfred Galdes accepted to conduct another on-site visit and the same team was sent. The follow-up was done after the resignation of Galdes. Zammit continues explaining that during the 2nd on-site visit, the FIAU officials were shown more documents.
Zammit testifies that there had been a meeting between the FIAU, representatives of Pilatus Bank and KPMG. Pilatus Bank insisted that reports by KPMG and Camilleri Preziosi found out that findings by FIAU were untrue.
Another report has been presented in court. Zammit says it is the Compliance Initial Findings Letter. It is a letter that the FIAU sends to a particular entity. The letter would contain findings of on-site analysis.
Alfred Zammit says that to his knowledge Police had acted on that report.
A document on Keith Schembri in relation to the selling of Maltese passports is presented in court. Zammit says that it is similar to the actual report. He says that the one presented in court has a different format but the details are the same. Says the report was sent to the Police.
Another document is presented in court. This document had been sent to the Police. This report was on Keith Schembri and Adrian Hillman.
He says that there were suspicions of money laundering and that he is disappointed that confidential information had been leaked.
He says that the document presented in court today and the final report should not be compared.
Comodini Cachia asks Zammit if the conclusions of the report are the same as those presented to the Police by FIAU. Zammit says he cannot tell for sure as he does not remember well.
Zammit presents in court part of the report of the inquiry on Egrant which allegedly shows that the report was sent to the Police.
The inquiry board orders Mr Zammit to answer to the question of Lawyer Comodini Cachia. Zammit says that the document was not yet concluded at the time and that eventually would have been sent to the police.
The inquiry board asks lawyers and Mr Zammit to keep calm and to lower their voices.
He again asks to testify behind closed doors.
Alfred Zammit says that the document has never been sent to the police for investigation as it was not yet finalized. Says the report investigated Konrad Mizzi.
Zammit says the document is an internal working document and the FIAU does not refer to it as a finalized report.
Lawyer Therese Comodini Cachia shows in court a document of FIAU which has already been published in the media. Zammit says he would like to testify behind closed doors if questions related to specific cases are asked.
Alfred Zammit said he then took the post as acting director of the FIAU mid-2016 till the beginning of 2017 following the resignation of Manfred Galdes.
The Deputy Director of FIAU, Alfred Zammit is testifying in court. He said that he took the post as of December 2010.
Family members of Daphne Caruana Galizia are present in the courtroom.