Court thwarts bid to stop Satabank €1.5m release to 'dirty oil' suspect

Oil-smuggling suspect Gordon Debono has offshore companies with an account at Satabank, the monies of which have been frozen since the bank went under controllership

Gordon Debono
Gordon Debono

Malta’s financial regulator has lost a bid to stop the shuttered Satabank from releasing funds from the bank account of an offshore company belonging to ‘Dirty Oil’ suspect Gordon Debono.

Debono is facing criminal charges related to a €30 million oil-smuggling ring in Catania, Sicily, together with conspirators Darren Debono, the former Malta footballer, and Libyan ‘smuggling king’ Fahmi Slim Bin Khalifa.

Gordon Debono ran several companies involved in the trading of oil to various multinationals from his Portomaso office, where Satabank also had its headquarters.

But apart from his Malta firm, Debono also has offshore companies with an account at Satabank, the monies of which have been frozen since the bank went under controllership.

Yet an attempt by the MFSA to stop the Satabank cash from being released to one of Debono’s offshore companies – to repay a loan from another offshore company probably owned by his own wife – was thrown out by a court of appeal.

The decision concerns the powers of a first court in stopping Satabank from executing the withdrawal of OSC’s deposits, over money laundering concerns. The Appeals Court believes there is no grounds to stop the withdrawal, because the money will still have to be scrutinised for money laundering purposes.

At the heart of the matter is the MFSA’s bid to stop Debono’s company Oil & Ship Consultancy (OSC) of Belize, from using money in Satabank to pay back a €1.5 million from Dubai company International Properties and Investment Ltd (IPIL). As it turns out, IPIL’s ‘board of directors’ is represented by Gordon Debono’s wife Yvette.

In July 2018 the two companies went to a Cypriot court, which recognised the constitution of debt between OSC and IPIL, that reached a ‘court settlement’ for €1.5 million and 3.5% interest. The loan agreement was created just a month before Gordon Debono’s arrest in Sicily in late October 2017. Yvette Debono was only transferred the Dubai company’s shares in March 2018 from a corporate service provider.

A Maltese court this year recognised the Cypriot court’s decision, as per EU law.

But the MFSA opposed the release of funds from Satabank, taking the matter to another Maltese court, which said no funds should be released from the bank before there is “the proper scrutiny of these monies over money laundering provisions.”

However, in an appeal by IPIL, the three-judge Court of Appeal presided by the Chief Justice, specifically says the first court was wrong in stopping the execution of the debt repayment.

“Satabank cannot issue the sequestered funds to OSC directly, but it has to deposit this money to the court that issued the executive title, and one understands that the withdrawal will only be authorised if and when there is no reason to stop such a withdrawal – particularly if this process of verification on Oil & Ship Consultancy does not reveal any irregularities.”

Oil & Ship Consultancy Ltd was struck off the Belize registry of companies in February 2019.

A second, similar case is now ongoing in the Maltese courts, to enforce another Cypriot court decision, brought by Yvette Debono’s IPIL against a BVI company, Marine Offshore Investments Ltd (MOIL), over a €1.3 million loan agreement also created on 4 September, 2017. The debt was recognised by a Limassol court in June 2018.

Originally, the United States’ Office of Foreign Assets Control issued sanctions on companies owned by Gordon Debono, but neither MOIL nor OSC were identified in the first raft of sanctions.

These included Malta-based Petroplus Limited, The Business Centre Ltd., Inovest Ltd., KB Lines Limited, Motorcycle Art Ltd., Hi-Low Properties Ltd., Eleven Eighty Eight Limited, Malta Directories Ltd., Mr Handyman Ltd, KB Investments Limited, Seabrass Limited, Tara Limited, Krakern Limited, Gorge Limited, S-Cape Yacht Charter Limited, S-Cape Limited, and Italy-based Petropark S.R.L.