Issue link: https://maltatoday.uberflip.com/i/1401709
6 maltatoday | SUNDAY • 15 AUGUST 2021 NEWS €500,000 FIAU fine for money transfer firm Sendvalu MATTHEW VELLA THE FIAU has fined the Maltese sub- sidiary of Swiss money transfer brand Sendvalu a total of €502,000 for money laundering breaches. The company, AWS Malta, is owned by AWS Switzerland, and its Maltese directors include Jean-Pie Gauci-Mais- tre of Gauci-Maistre Xynou law firm, chief financial officer Steven Zammit Cutajar, and Mark Portelli, of Virtu Shipping and CEO of MIDI plc. The FIAU found several breaches of due diligence and a lack of information on the company's customer files. In a significant number - 84% of the sample - of customer files reviewed, the compa- ny had failed to collect adequate infor- mation on the purpose and intended na- ture of the business relationship, which is required to establish an adequate cus- tomer business and risk profile. The FIAU said the company failed to undertake appropriate enhanced due diligence measure in instances clearly posing a high money laundering risk. In one file relating to a Sri Lankan na- tional actively transacting since January 2017, the company only requested EDD information three years after Sri Lanka was listed on the FATF's high-risk ju- risdictions, well after over 220 trans- actions passed through. The customer then stopped all transactions after the company requested EDD. In another case, over a period of three and a half years years, a customer re- mitted a total of 1,096 transactions to the Philippines amounting to $402,450 and €24,000. The stated purpose of re- mittance was to aid the customer's Phil- ippine friends for medical assistance, to purchase a new phone, to assist in set- ting up a beauty salon, and other pur- chases of services and goods. The customer's stated source of funds were a monthly pension and a personal line of credit. But the FIAU said further documentation should have been col- lected, to have better insight into the source funding such transactions, as well as to ascertain the veracity of the remittances. In another case, a significant discrep- ancy was revealed between a customer's wealth and total funds remitted over a four-year period. 563 transactions were remitted by the customer to India, to pay for family maintenance costs, school fees and other expenses; but the customer, with savings of $70,000 and salary earnings of $259,200, however remitted over $800,000 and €300,000 respectively. The FIAU said the high value of trans- actions passing over to India should have led AWS to ensure the informa- tion provided by the customer on the transactions was substantiated. The FIAU found seven breaches of the Prevention of Money Laundering and Terrorist Financing Act. "Many of the failures have been con- sidered by the Committee as serious and systemic, which seriousness is com- pounded when taking into considera- tion the high-risk business model of the company's operations, the jurisdictions to where the funds were being remitted, the inadequacy in establishing a con- crete customer profile and in view of several transactions processed without the appropriate levels of inquiry, prob- ing and scrutiny," the FIAU said. "The seriousness and systemic nature of these findings has led the committee to impose an administrative penalty of €502,046." CONTINUED FROM PAGE 1 Yet four months since then, Barbara's clients have had to lawyer up after his wife Rose- anne was unable to disburse re- funds on their promise-of-sale agreements from her late hus- band's client account. While the Notarial Council is aware of the case, attempts by MaltaToday to get in touch with the Barbaras' lawyer, Phyllis Aquilina, proved futile. A request for comment from Rosanne Barbara did not go answered. As recently as at 29 July, Rosanne Barbara had told cli- ents of her late husband, to speak to her lawyer, claiming the disbursement process was "still ongoing". According to chats between Barbara and one of the con- cerned clients, seen by this newspaper, her lawyer had in- formed the clients that Barbara has refused her husband's in- heritance, so as not to assume his pending debts. The client said that in one of his conversations with Rosanne Barbara, the widow had told him there was not enough money to cover the cli- ents' claims. Another client of Barbara, posting a comment in a Face- book group discussing the case, claimed the late notary had not deposited the funds that are kept in escrow in a clients' ac- count, but in his personal ac- counts. "The wife is asking for payments so she will pass on the files, but will not guarantee that any money left as deposits or otherwise are paid, even in the future." The clients' money represents deposits paid on forthcoming property purchases, usually amounting to 10% of the sale value. The money is supposed to be kept in escrow by the notary, in a client account, up until the final property sale agreement is signed. The buy- er's deposit is then passed on to the seller together with the rest of the transaction. The de- posits are used to seal a prom- ise-of-sale on the property, for the duration of the notary's researches on the house own- ership. Should the buyer not come forward to finally acquire the property, the deposit is for- feited in favour of the vendor. The Notarial Council is work- ing with the Commissioner for Revenue and the Malta Infor- mation Technology Agency (MITA) to develop an integrat- ed online system that allows near real-time registration of deeds and tax payments, with banks, departments, notaries and property vendors and sell- ers notified immediately. The system could strengthen legal certainty and act as a safeguard against abuse by registering monies held in escrow. Clients face wall of silence over deposits paid to notary The late notary Ivan Barbara: his clients want refunds on the deposits they paid to him to be held in a client's account