Christie’s expert hunts for stolen millions in lawsuit against Bank of Valletta

An international hunt for millions in cash stolen from an art specialist in New York has found its way into a Maltese court, knocking on the door of auditor Joseph Sammut and his Libyan networks.

Sammut, a one-time treasurer for the Labour Party, is already in court facing criminal charges of having set up fabricated companies to enable Libyan nationals to obtain residence permits. Many of these clients enjoyed the patronage of the Gaddafi family back in Libya. Indeed, Sammut even handled private finances for Muammar Gaddafi’s slain son Muatassim, with Bank of Valletta.

For years now, the internationally known specialist Pierre Amrouche, has been chasing €6 million in funds which disappeared from his company, and allegedly funnelled into a Libyan venture that never existed.

Even here, Joseph Sammut’s clients – flaunting their Gaddafi connections – are at the heart of the accusations made by Amrouche, an international specialist for Christie’s in African and tribal arts.

Now the revered expert Amrouche is accusing Bank of Valletta of showing negligence in its due diligence when his manager Henri Baudet, used €6 million from a fund used for art transactions, to invest in a ‘Libyan project’ run by Belgian national Dirk Borgers and Tunisian national Maher Mellouli.

The cash eventually passed through BOV accounts held by a host of companies set up in Malta by Joe Sammut, for Mellouli.

Baudet has since been convicted by a Geneva court for breach of trust and forgery, receiving a suspended sentence of 24 months’ jail, as well as being ordered by a Maltese court to pay Amrouche €750,000 [PDF] in cash processed via Maltese bank accounts.

Joseph Sammut: the auditor set up the companies used for a ‘Gaddafi project’ ruse although no wrongdoing is being alleged on his part

The Mellouli companies in Malta include those already flagged by MaltaToday back in 2015, when Sammut started attracting considerable business from Gaddafi associates. The companies Sealandair Energy, Aviacom, Gencon, Best Inter, and Mediterranean Oil have also come under the focus of Command Global Services, an American investigative firm once tasked by a Libyan magistrate to hunt down Libyan dictator Muammar Gaddafi’s hidden assets.

Amrouche’s lawyers believe the art expert’s millions were split amongst these companies for the personal use of Mellouli and the late Borgers, who promised huge profits to Baudet for a ‘Libyan project’ which had the interest of one of Gaddafi’s sons. The claims were false.

The Belgian police also said, in letters rogatory to their French counterparts, that Baudet himself had spoken to Bank of Valletta manager Noel Abela, of the bank’s International Corporate Centre, who allegedly reported “the existence of a bank account with a positive balance of €1.4 billion” in the name of the Gaddafi family.

The lawyers deposited in court email exchanges, which show Abela executing instructions from Mellouli on the transactions relating to his company accounts. Abela was questioned by a Maltese magistrate at the request of the Belgian police. No charges were pressed against Abela, who in the civil court case against BOV refused to answer questions by Amrouche’s lawyers.

Amrouche’s representatives insisted that the activities of Mellouli’s companies “were nothing except to receive money on a Monday and send it out on Tuesday… and apparently Bank of Valletta did not have procedures at the time to control these funds.”

“The employee of the bank involved in this matter… his authority was only to do transactions up to €10,000,” witness and lawyer Suzanne Wolfe Martin said in court.

“However, they created perhaps half a dozen companies, pure paper companies, to open bank accounts. We have records of funds going directly from [Amrouche’s] Primitive African Art (a Gibraltar company) to the company in Malta and going out the next day.”

According to Wolfe Martin, the funds were introduced into a Belgian bank, of which so far just €800,000 has been retrieved. “We immediately started an investigation here with the police as to the funds received in BOV and we learned that the structure was a group of Maltese paper companies lo-cated in the office of Joe Sammut.”

Wolfe Martin insisted that BOV was negligent in not having investigated the activities of companies purporting to be commercial companies, but used for 24-hour transactions.

“We feel the role of Bank of Valletta was to use their due diligence in examining where these funds were coming from and where they would be going. We might have been able to seize them; instead they were apparently […] coming from unknown sources.”

Witnesses from Bank of Valletta have insisted in court that due diligence was carried out on all parties and companies, but that certain deposits from reputable banks like Coutts & Co. of Zurich were processed in the belief that the originating bank had carried out its own checks.

The BOV representative also said the bank launched its own internal investigation into the matter.

Right of reply: Bank of Valletta

Reference is made to your feature ‘Christie’s expert’s hunt for millions brought to Malta’ ( 1 September) and ‘Christie’s expert hunts for stolen millions in lawsuit against Bank of Valletta’ online (3 September).

Banking secrecy regulation prevents the Bank from commenting in detail about customer affairs. Suffice it to say, however, that the article is riddled with factual inaccuracies, and that the amounts mentioned are ludicrous. The Bank reiterates that it operates in accordance with all local and European anti-money laundering laws and regulations, and observes sanctions issued by local and international bodies, including sanctions issued by US authorities.

Unfortunately, sensationalist articles such as this serve only to undermine the efforts of the local banking sector and the regulatory authorities to shore up the reputation and attractiveness of Malta as an international financial centre.

Charles Azzopardi, Executive PR & Marketing, Bank of Valletta

Editorial Note: There is little to be sensationalist about when it comes to publicly accessible and verifiable court evidence and depositions. The article is correct and faithful to much of the testimony in court, the letters rogatory and linked court judgements that has been presented so far. The banking sector’s reputation is up to the regulator and its practitioners to preserve; the press cannot abdicate its role as a watchdog to vicariously serve the financial services industry.