FIAU suffers setback as court overturns judgment
The FIAU (Financial Intelligence Analysis Unit) suffered a significant setback yesterday in its regulatory functions, the Constitutional Court having overturned a decision rendered earlier by Judge Lawrence Mintoff.
The case refers to an administrative decision by FIAU in November 2020 fining Insignia, a credit card service company for the super rich, of € 374,000 for various offenses against the law on money laundering. .
The company, which former economy minister Chris Cardona joined shortly after resigning his ministerial post, appealed the ruling, claiming the FIAU’s findings were wrong.
At the same time, the company filed a constitutional complaint, insisting that the way FIAU conducts its business and the same provisions of the anti-money laundering law it implements violate constitutional rights. and humans from the same society.
According to Insignia, FIAU was acting arbitrarily as a prosecutor, jury and judge, which violated its constitutional right to a fair trial.
The company also insisted that before its appeal for the fine could continue to be heard, the same court had to wait for a decision from the constitutional court on whether the FIAU was acting against the Constitution.
In July, after hearing the constitutional case, Justice Lawrence Mintoff ruled against Insignia’s arguments, dismissing his case and ruling that the fine appeal should continue to be heard despite unconstitutional claims by the company.
Yet the Constitutional Court yesterday overturned Justice Mintoff’s ruling and agreed that the lower court should first consider whether the FIAU violates Insignia’s constitutional and fundamental human rights and only after that, it would consider the appeal against the ‘fine.
Legal sources told The Shift that this means that if the court finds that the FIAU violates constitutional rights by imposing administrative fines, it will be a major setback for the anti-money laundering agency because all of its actions could be declared unconstitutional. and a change in law required.
Why was Insignia fined?
Insignia – a Valletta-based company established in 2011 – offers card services to high net worth individuals. It is owned by a Cypriot company of the same name. Its directors are the Briton George Kesidy and the Serbian Nada Tucakov.
Shortly after resigning from his post as Minister of the Economy, Chris Cardona joined the company as an advisor.
According to FIAU, an on-site inspection showed how the company failed to file a suspicious transaction report regarding a Russian client who was a politically exposed person with suspected Mafia ties.
FIAU claimed that Insignia only obtained a source of wealth declaration form that only corroborated information about the Russian client’s estimated income and assets, allegedly from his entertainment business.
FIAU’s compliance review revealed that no risk assessment had been performed for six file reviews. He also alleged other significant violations of the law on money laundering.
Insignia refutes the allegations and challenges them in court.