Local media reports about the closure of Maltese Satabank have been circulating for a week. The institution is well known for opening accounts for high-risk companies such as gaming. Some binary and CFDs brokers have held accounts with the bank in the past.
According to officially available information, the assets of several gaming companies have been frozen. Satabank has been unable to reimburse clients or pay the company’s employees.
The online gaming sector in Malta accounts for €1.2 billion of the local economy. This represents about 10 percent of the country’s annual GDP.
The repetitional damage to companies holding their funds are Satabank could be insurmountable. The Maltese financial regulator, the MFSA, mandated a competent person to begin the redistribution of funds back to clients. For the time being no timeline has been provided.
The regulator’s statement on the matter elaborates that the release of any funds will be subject to additional controls. The authorities are auditing the company’s anti-money laundering procedures.
“This process will require Satabank customers to verify their identity and provide additional information and details of another account with a credit or payment institution in an EU/EEA jurisdiction in the same name as the existing account at Satabank to which monies can be transferred,” the statement from the MFSA clarified.
NewsBTC to Make Splash at London Summit 2018Go to article >>
Disruption to Last Several Weeks
The issues affecting the bank are expected to last several weeks, the authorities shared. The company which is appointed to redistribute money back to clients, Ernst & Young, is expected to keep the measures in force until the conclusion of the necessary investigations.
Gaming companies whose business has been affected are facing a hard time as the funds of their customers are inaccessible. Their customers are going to be affected for an unknown period of time.
In an official statement, Satabank shared with its clients that they have read-only access to view their account balances online. The issue is affecting the Maltese economy in a major way, due to the size of the bank and the gaming sector.
A number of employees of Maltese companies have also been affected in a major way. They largely used Satabank to open e-money accounts after facing difficulties to get bank accounts.
At present all calls to the bank are diverted to a call center in Bulgaria.
Brokerage Industry Effect Likely Minimal
Some brokers have used Satabank in the past, as the company was seen as broker-friendly. To date, we have no confirmation that any companies from the industry have been affected by the issue.
The MFSA pushed brokers away from the island, and most of them either relocated to Cyprus or offshore. The local regulator has not been welcoming to regulate new companies in the forex space for about four years now.