Bank of Valletta cash freeze challenged in court

Italian wants €270,000 released to his mandatory, but bank fears anti-money laundering breach

File photo
File photo

An Italian man is suing Bank of Valletta for closing his account and refusing to release his funds for over six years since a 2015 report of fraud that was never followed up with police or court action.

Last March, Alberto Maurizio Re filed a sworn application against BOV, arguing that the bank was refusing to release €271,253 in funds he kept at the bank.

Maurizio Re claims to have received the money as a payment for services rendered to a certain Igor Zui, a Russian national. Sometime after receiving the funds, Romanian bank Raiffeisen, which had sent the funds on behalf of Zui, requested a recall of the money due to an allegation of fraud by its client.

Maurizio Re received a letter from the bank in June 2015 informing him that it would not release the money and asking him to contact it. His account was blocked, and refused to allow him to access his money pending an investigation.

Maurizio Re says he provided an explanation for the funds, and that Zui had never spoken to Maurizio Re about the matter.

Zui is thought to have come to Malta to file both a complaint with BOV as well as a police report about the matter in 2015. However, no further action was taken and no civil or criminal proceedings were ever filed in this regard to date, six years later.

In 2020, with his account still blocked due to pending investigations by BOV, Maurizio Re engaged a Maltese law firm to request an update from the bank. No formal reply was forthcoming.

In view of the lack of reply, Maurizio Re instructed his lawyers to file a judicial protest. Not long after that, BOV sent him a letter, informing him that they were closing his account and requesting him to advise where to send the funds. He instructed his lawyers to inform the bank to send the funds either to his lawyers or to his accountant, who represented him as his mandatory in Malta.

The bank, however, refused, saying it would not accept instructions from his lawyers. In their reply to the court case, the bank explained that its refusal to deposit the funds in a third-party account was to avoid falling foul of anti-money laundering regulations.

BOV has said it had not been informed by the authorities about any proceedings filed against the plaintiff by Zui or Raiffeisen Bank, and that it proposed to release the funds to Maurizio Re personally, but not to a third-party account.

This position had since changed, with a bank representative recently confirming in court that the bank would not release the funds unless there is a court judgment ordering their disbursement. The representative testified that the foreign bank never provided any further information after the 2015 claim, and that BOV was never contacted again by Zui or the foreign bank.

Maurizio Re’s lawyers Ryan Falzon and Jonathan Thompson argue that the bank had abusively decided to ignore their former client’s instructions, causing him serious financial difficulties which led to a judicial sale by auction of his residence in Italy.