If this country ever needed to be reminded, the arrest of the Pilatus Bank chairman, Seyed Ali Sadr Hasheminejad, in the US was the umpteenth confirmation that the country’s institutions are in serious crisis. The Finance Minister disagrees but the European Banking Authority is reviewing the country’s supervisory institutions and that does not sound good.
Pilatus Bank hit the headlines a few weeks before last year’s premature general election when murdered journalist/blogger Daphne Caruana Galizia alleged that the Prime Minister’s wife was the owner of the elusive Panama company Egrant Inc. Joseph Muscat and his wife immediately denied the claim and an election was called soon afterwards. The Labour Party won handsomely, though Ms Caruana Galizia never believed Egrant was the real reason for that election.
Meanwhile, a Russian whistleblower emerged to ‘substantiate’ the claims on Egrant, though it later transpired there was another source. The whistleblower escaped from the country and an arrest warrant was issued. Now Maria Efimova, a former employee of Pilatus Bank, has turned herself in to the police in Athens and faces the prospects of being extradited to Malta.
That could cause problems for the government because recent events have again raised doubts and suspicion on Pilatus Bank. It may have suited the government to kill the story but the US is sending FBI agents over.
Many were justified in asking questions when, just hours after the Egrant story emerged, one could watch on television footage of bags being carried out of Pilatus Bank. The luggage could have contained dirty linen or compromising documents. It could not be ascertained because the police only moved in hours later.
The day after news reached this country that the Pilatus Bank chairman had been arrested in the US, the Prime Minister was out marking Freedom Day. He made no mention of the arrested chairman, whose wedding he attended (as did his chief of staff and a director of Allied Newspapers), however, he instead promised to make Malta not just the best in Europe but the envy of the world.
It was an old trick, an appeal to us-and-them mentality prevalent in island states and wholly exploited by his predecessor, Dom Mintoff, in the 1970s and 1980s. It was Dr Muscat’s only line of defence.
Neither did he refer to Pilatus the following Sunday when he promised new economic sectors. Ignoring the Pilatus problem would not make it go away.
The US arrest appeared to justify the claims made against that bank for over a year now. The Finance Minister disagrees, of course, saying it is all about sanction-busting. He may be right but who would bust sanctions?
No promises, no pipe dreams from the Prime Minister will make this crisis go away. It started with the Panama Papers and has haunted his government ever since. The Prime Minister did nothing then; now this latest scandal is tightening the noose ever further, choking the administration, the financial services industry and the country. He cannot just do a Pontius Pilate and wash his hands of this serious matter.
It will be a sad way to go for a Prime Minister who plans to bow out before the election. There is economic progress but there is also a rot and that is what probably one will read about him in the history books.
This is a Times of Malta print editorial