MAGISTRATE IN MALTA RECOMMENDS THE FILING OF CHARGES AGAINST TWO FORMER GOVERNMENT OFFICIALS IN ELECTROGAS BRIBERY CASE, KEITH SCHEMBRI AND KONRAD MIZZI, WHO HAD PREVIOUSLY BEEN CHARGED IN THE VITALS HOSPITAL SCANDAL

PULLICINO, SCHEMBRI, MIZZI and BOLOGNA

KEITH SCHEMBRI, the former Chief of Staff to disgraced former Maltese Prime Minister JOSEPH MUSCAT, and KONRAD MIZZI, a former minister in Muscat's corrupt administration, now both face likely new criminal charges, after a magisterial inquiry recommended bribery and other charges not yet named, for their participation in the ELECTROGAS scandal, which has been the subject of numerous articles on this blog in recent years.Last year, both Schembri and Mizzi were also charged in the VITALS hospital scandal, which we have also covered here in detail on the Financial Crime Blog.

Joseph Muscat

Also named as likely ELECTROGAS case defendants are the millionaire businessman YORGEN FENECH, a suspect in the assassination of investigative reporter DAPHNE CARUANA GALIZIA, and Electrogas figures MARIO PULLICINO and PAUL APAP BOLOGNA. It was thought by most legal observers in the EU that the systemic corruption which exists in the Republic of Malta among both the judiciary and the police would bar the proper administration of justice in these corruption cases, and we welcome this new development as a step forward in the enforcement of the Rule of Law.

THE BANK OF AMERICA OCC CONSENT ORDER INCLUDES A TRANSACTION MONITORING LOOK-BACK; WILL IT RESULT IN THE CLOSURE OF THE BANK'S CARIBBEAN CORRESPONDENT ACCOUNTS, DUE TO RAMPANT MONEY LAUNDERING THROUGH CBI PAYMENTS?

If you are like me, you read the entire 43-page B of A Office of the Comptroller of the Currency (OCC) Consent Order (a/k/a Cease & Desist) closely, and found most of the regulator's requirements to be boilerplate, when it comes to compelling a bank with an ineffective AML program to conform to Banking Best Practices. There was one item, however, that may eventually cause some sea changes at B of A; the Transaction Monitoring Look-Back that appears at Article IX, on page 15-17.

While we understand that Bank staff have made it clear unofficially that they are not concerned with any exposure, regarding the correspondent accounts it maintains for the five East Caribbean states, Antigua, St. Kitts, Dominica, St. Lucia & Grenada, that have CBI passport sales programs, the Look-Back is certain to uncover a large number of transactions that are suspicious on their face, and where SARs should have been, but were not, filed of record.

The question is how far the third-party, designated as "Program Consultant," will take that information. Will there be a recommendation to restrict, or even close, some or all of those correspondent accounts servicing the Caribbean, where CBI payments in US Dollars, transit and are cleared? Given the bank's obvious reluctance to close those accounts, and lose that lucrative business, the question becomes whether the money laundering risks outweigh the rewards, and what the Program Consultant does in 2025.

ALLEGATIONS OF DRUG TRAFFICKING AGAINST ST. LUCIA MINISTER INVENTED BY JEALOUS POLITICAL RIVALS AND WITHOUT ANY BASIS IN FACT

Minister Richard Frederick

We have updated our investigation into the leaked classified U.S. State Department cable that alleged Saint Lucia Housing Minister RICHARD FREDERICK was connected to narcotics trafficking decades ago, and wish to bring our readers up to date on the issue.

(1) Our readers may recall that, back in 2021, we conducted our initial investigation into the charges, and found that the allegations had no merit. We published those conclusions on our blog of August 30, 2021. That article is still available: https://lnkd.in/e2DhSJzZ

(2) New allegations surfaced in late 2024, and we undertook to update our research last Fall.

(3) Our inquiries have confirmed that the drug trafficking label was placed on him by former Saint Lucia Prime Minister KENNY ANTHONY'S Labour Party, reportedly out of jealousy for his rising political status, and the likelihood of Frederick eventually being named the leader of the United Workers Party, during the administration of the incompetent STEPHENSON KING. Most observers consider Frederick to be a victim of Saint Lucia's corrupt politics.

(4) There's more; A U.S. law enforcement task force, led by two highly senior investigators with extensive Caribbean experience, investigated the allegations for just under two years, and were unable to find any evidence to corroborate Anthony's allegations.

Therefore, we continue to stand behind our 2021 article and its fact-based conclusions. Political corruption continues to thrive in Saint Lucia.

TD BANK NOW GUN-SHY, BUT IT'S TOO LITTLE AND TOO LATE

You've gotta love that story this week, by a longtime customer of TD BANK, who cam into a branch to withdraw $3000, which was to be used to pay for a big holiday family dinner. It took a full half hour for the bank to disburse the cash, ad the customers went through no less than three staff members, some of whom had the temerity of asking their customer for the purpoise of this "large" withdrawal.

Of course, there was no disclosure, and the bank staff finally dispensed that small amount of cash, but it shows you that bank staff must be feeling pressure after that billion dollar penalty for facilitating money laundering over a period of time. Here in South Florida, compliance officers knew there were flaws in the bank's AML program, after one of its vice presidents went to Federal Prison here a decade ago for assisting a Fort Lauderdale law firm perpetrate a huge Ponzi scheme.

Presently, the bank's involvement in operating a correspondent account for a corrupt Caribbean Citizenship by Investment (CBI/CIP) agency in Saint Lucia, where allegations of massive money laundering and fraud appear to have gone intentionally ignored, is just one more indicator that things were not right in the bank's AML/CFT compliance programs.

The question is;: will any of the bank's senior management go to prison for their egregious, intentional operations, which trumped profits over following banking best practices? Unfortunately, they are letting those criminals retire, from what I have seen. So much for deterrence.

ALERT FOR MONEY LAUNDERING FUGITIVE LIN PEN-WEN - INTERPOL RED NOTICE ISSUED

This individual, with links to organized crime, is wanted by the New Taipei District Court for his participation in an international money laundering scheme. Details can be found here. https://lnkd.in/e_SkFxnS

EFFECTIVE DUE DILIGENCE REQUIRES MUCH MORE THAN SIMPLY ACCESSING GOOGLE MAPS

The recent article directing readers to the use of Google Maps, to verify addresses, confirm physical locations of new account holders and their listed businesses, misses the mark. Compliance officers should, wherever possible, stock to official county, state and local information resources, as the Google information you intend to rely upon is most most likely stale, and therefore could be unreliable. Local government records, which are used for tax assessment and collection purposes are far more reliable, especially when double-checked by accessing public records databases of recorded documents. For example, Government real property records, used for tax purposes, are not only a rich source of very detailed, information, they may also give you historical data you cannot find without painstaking trolling of other resources. Become familiar with, and know precisely where all your government information online and hard copy sources are, and depend upon them first. They may be the only suspicious activity indicators you will find.

Remember, not all Google resources tell the inquirer how many months, or years, it has been since the information was posted. Money launderers often create credible cover stories about front companies by piggybacking upon formerly existing but no longer active legitimate businesses, addresses or locations, thinking that your perfunctory due diligence checks won't uncover the inconsistencies that a thorough examination, with dual confirmation of data might reveal. Ignore unofficial resources whenever possible, as those may just have settled upon republishing dated data, and are neither current nor accurate.