Satabank freeze: bank issues instructions for controlled withdrawals

Release of funds by Satabank will be subject to certain controls and checks following which, funds can be transferred

The Malta Financial Services Authority (MFSA) has initiated a controlled process for the return of Satabank customer deposits over a period of time, after the bank was placed under the control of auditors EY as a competent person appointed by the regulator.

The release of funds by Satabank will be subject to certain controls and checks following which, funds can be transferred. This will take time, and customers should not expect immediate access to their funds.

There remains no access for customers to submit transactions, make withdrawals or close accounts.

The process to return funds This process will require Satabank customers to verify their identity and provide additional information and details of another account with a credit or payment institution in an EU/EEA jurisdiction. Further details of the process will be made available as they are finalised by the authorities.

Utilisation of other accounts Where customers have an account with a credit or payment institution in an EU/EEA jurisdiction Satabank would advise that they transfer their banking arrangements to this institution. Where customers do not have an account with such a jurisdiction the bank encourages them to open one in the same name as their existing account at Satabank.

Customer access to account information Satabank customers now have read only access to view their online account balances.

The MFSA has allowed EY to initiate a controlled process for the return of customer deposits over a period of time, in a variation on a freezing order on Satabank which affected withdrawals and the monies held by some 28 gaming compainies which used the bank to effect withdrawals to their customers.

The relevant authorities are agreeing the process and further guidance will be provided by the Competent Person on the bank’s website as soon as practical, although this is likely to take several weeks.

Although Satabank continues to meet all capital and liquidity requirements, the MFSA's measure shall remain in force until such time as the the regulator shall otherwise direct.

The bank was placed under the guardianship of auditors EY as a competent person last week after a joint inspection and audit by the MFSA and the Financial Intelligence Analysis Unit (FIAU) found shortcomings in the bank’s anti-money laundering procedures, according to reports. 

The Central Bank then suspended the participation of Satabank plc in Target2-Malta, and the MFSA ordered the bank to suspend a number of its services such as refraining from taking further deposits, or processing any withdrawal or outward transfers from any accounts held by the bank. 

In July, Satabank was slapped with a €60,500 fine after it was found to be in breach of risk management laws. The bank was also named by a Sicilian prosecutor as having been used by fuel trader Gordon Debono to receive ‘illicit’ payments through his Maltese company Petroplus Ltd as part of an alleged €30 million fuel smuggling ring. 

More in Business News