Issue link: https://maltatoday.uberflip.com/i/688389
maltatoday, SUNDAY, 5 JUNE 2016 6 News MATTHEW VELLA THE Financial Analysis Intelli- gence Unit will be analysing why financial institutions like money remittance companies have re- ported less suspicious financial transactions than in previous years. The anti-money laundering unit, which is run by the police and the Attorney General, is tasked with handling so called STRs (suspi- cious transactions reports) from banks, legal professionals, gaming companies, casinos, or real estate agencies, when large amounts of money and their source cannot be accounted for. But in 2015, the FIAU said that the only sector where the number of STRs had decreased – against the general trend of annual in- creases – was that of financial in- stitutions, down to 11 reports in 2015 from 18 in 2014. In particular, the FIAU said their level of reporting "remained wor- ryingly low" and that it would investigate why this level of re- porting remained low and take measures to rectify it. In fact, a general increase in STR submissions was noted across practically all categories, a 21% in- crease over 2014 that mainly came from credit institutions and banks – in total 281 reports. Of the 136 STRs from credit in- stitutions, 105 were led by the sev- en core domestic banks, compared to 77 STRs in 2014, predominantly involving foreign, legal and natural persons having no connections to any Maltese natural or legal per- sons. But there was a significant in- crease in STRs from investment services licensees and remote gaming companies. The 281 STRs included reports on 602 persons, of which 70% were either non-Maltese nationals or foreign companies. Cases actually forwarded to the police amounted to just 20 reports following a determination of rea- sonable suspicion of money laun- dering. The use of Maltese-registered companies featured prevalently in suspicious transactions that used Maltese bank accounts. Invest- ment services providers were used to potentially disguise the origin of criminal proceeds: two such cases were referred to the police where investment services providers were used by people allegedly in- volved in organised crime groups to launder funds of illicit origin. Suspicions involving domestic bank accounts and Maltese com- panies used by foreign nationals were linked to international net- works laundering the proceeds of fraud, VAT carousel schemes, corruption, misappropriation and organised crime. Once laundered, the proceeds of these crimes were suspected to have been subse- quently transferred to foreign bank accounts on the presentation of fabricated invoices and false in- formation. In one case, the FIAU said a foreign politically exposed per- son (PEP) had made transfers to a Maltese bank account using in- voices "that clearly appeared to be fabricated". One of the predominant ways of using the remote gaming industry to launder money was chip dump- ing – the intentional loss of chips to another player, especially on a virtual poker table, the FIAU said. In one case, considerable amounts of cash denominated in high-value notes were exchanged into gaming chips in a casino and then changed back into lower- value notes in what appeared to be an attempt to break down the proceeds of crime into more us- able denominations. In a separate case that raised the possibility of terrorist financing, the FIAU noted that a number of money remittances were made in favour of a Maltese national, who then withdrew the cash using AT- Ms and cashier facilities, before transferring the funds again to various individuals abroad using money service bureaus. mvella@mediatoday.com.mt MATTHEW VELLA THE Maltese names that featured in an anti-mafia operation in Reg- gio Calabria, have been removed from the list of potential suspects in Operation Gambling, an inves- tigation into money laundering based in Malta through the use of remote gaming firms. David Gonzi, a lawyer whose company GVM Holdings gave the Italians fiduciary services, and Iosif Galea, a gaming consultant, were removed from the list of suspects in the conclusion of investigations by the anti-mafia directorate of Reggio Calabria. Galea was the director of the company Betsolution4U, which was on the prosecutors' list of suspicious companies, with Keith Massa as company secretary. The three shareholders in the compa- ny included GVM Holdings. The bust on the Betuniq group, which is run from offices in Mal- ta, had led to the arrest of Mario Gennaro, 39, an associate of the Calabrian 'Ndrangheta who had taken up sojourn in Malta togeth- er with other associates. Gennaro was arrested in 2015 on the strength of a European Arrest Warrant. Despite Gennaro having already outed in 2011 as an associate of the Tegano clan, neither the Mal- ta Gaming Authority nor GVM Holdings – the company that gave the Betuniq group fiduciary ser- vices to hide their owners' identi- ties – appear to have been aware of the criminal elements planning to funnel millions through Mal- ta's remote gaming industry. The Betuniq group's ties to the 'Ndrangheta were revealed during a Palermo tribunal on 26 May, 2014, that had condemned several members of the Noce clan of the Sicilian Mafia to a total of 300 years' imprisonment. Gennaro was then exposed to have been running Betuniq's net- work of gaming shops in Reggio Calabria and in neighbourhoods controlled by the 'Ndrangheta. But even earlier in 2011, in a sei- zure order issued by the Reggio Calabria anti-mafia unit, Gen- naro was described as being "tied to Franco Benestaro, deputy head of the Tegano 'ndrina". "In his lifetime Gennaro has at- tracted the attention of inquiring magistrates for his relations with the Tegano 'ndrina," the Italian newspaper Il Sole 24 Ore report- ed in July 2014. "With him working in the back- ground, Betuniq is doing great, with 330 shops in Reggio Calabria and the rest of the south, raking in €225 million in 2013. Its singu- lar achievement is that it has no concession from the state – Betu- niq is blacklisted by the Customs and Monopolies Agency." But the Betuniq brand pros- pered in Malta, with a licence issued to Uniq Group Ltd in De- cember 2013, backdated to May 2012. The Uniq Group applied for a licence in November 2010, with due diligence checks conducted between then and February 2011. But no adverse remarks were found on the licensee and appli- cants. David Gonzi, the son of the former prime minister Lawrence Gonzi, had distanced himself from suggestions that Gennaro's criminal ties were overlooked by his fiduciary firm. Gonzi is a 33% shareholder in GVM Holdings, a name-lender company that serviced the Uniq Group and its owner Start Games Limited, and several of its associ- ated companies and subsidiaries. In Malta, the Betuniq compa- nies were controlled by Ulisse Bellino, Mario Gennaro, Mario Zucco, Domenico Lagrotteria, Giovanni Longo, and Cosimo Suppa – all names mentioned by the Reggio Calabria prosecutor as being part of the 'Ndrangheta's web of influence in their gaming interest. In the original dossier for Op- eration Gambling, the Reggio Calabria prosecutor, claimed it would be plausible to put Gonzi "right at the centre of an interna- tional criminal business triangu- lation network". But his name has since been re- moved from the investigation's dossier. Gonzi always denied hav- ing met or spoken to Gennaro, and that his first contact with the gaming companies was in Octo- ber 2013, when he had no reason to suspect they were involved in any unlawful activity. "It was only on this basis that the companies involved were accepted as clients of GVM." Gennaro was 'Ndrangheta's point- man Operation Gambling's 128 per- sons of interest found that Pend- ergardens resident Mario Gennaro was the point-man for the 'Ndrang- heta, running a gaming network as part of an alliance that also featured the Camorra of Naples, and the Si- cilian Mafia. "He guaranteed the controlled diffusion of various illicit [gam- bling] sites, the result of a criminal pact with entrepreneurs [Renato] Grasso and [Antonio] Padovani, re- spectively representing the Camor- ra and the Sicilian Mafia." The investigators claim that it is clear that Mario Gennaro was the 'Ndrangheta's representative "with whom Grasso and Padovani came to terms to guarantee the illicit and criminal sponsorship of their [gam- bling] shops in Calabria". Gennaro was arrested together with Margherita Giudetti, 34, Francesco Ripepi, 38, Alessandro Ciaffi, 40, Rocco Ripepi, 36 and Fortunato Stracuzzi, 37, all con- nected to the Betuniq brand and living in Malta. Anti-mafia magistrates conclud- ed that Gennaro's frequent trips to Malta and his participation in poker tournaments confirmed that the mafia's money was being trans- ferred to Malta. False invoices, chip- dumping used to launder money through Malta Maltese lawyer, consultant in 'Ndrangheta gaming bust, off the hook 'Ndrangheta man in Malta, Mario Gennaro (main photo). Below: David Gonzi and Iosif Galea, cleared