It feels like the pain of grey-listing by the FATF is well and truly forgotten. Malta’s pretence at fighting financial crime is being retired. Jonathan Attard, flanked by Judge Antonio Mizzi, announced a raft of measures to reduce the tools the law gave, up to now, to prosecutors to fight money laundering. Those tools are being thrown away.
The changes announced by the government concern freezing orders that are issued on the assets belonging to people accused of money laundering pending court proceedings.
Let’s be clear, if you’re innocent of the crimes you’re accused of, the current rules on freezing orders are punitive. They stop your access to your bank account, which impacts anyone who lives with you because their bank accounts are blocked as well. You’re barely allowed to withdraw enough money to eat. You need to ask the court for permission to pay your children’s school fees. Your business or professional activity is effectively frozen as well, which normally means that business or profession will die.
Since in principle everyone who is not yet found guilty should be presumed innocent, and since in principle nobody who is innocent should be punished, it should make sense to relieve innocent people of punitive measures.
On the other hand, there are situations where that principle must make way for other considerations. Someone who is accused of a major violent crime and who can and is quite likely to try to escape the country before they are tried and convicted, would be held in preventive custody until their trial. Being in prison is punitive. It has significant impact on your income and your ability to work. And you’re getting it while you’re still presumed innocent.
The principle of not punishing people who are presumed innocent of money laundering until proven otherwise must also give way to a few considerations. Firstly, the crime they are accused of is their wealth in and of itself. That’s what money laundering is: the act of cleaning up dirty money so that you can use it as if you’ve earned it.
Jonathan Attard said the law will now force prosecutors to identify which portion of the accused’s wealth they believe to have been laundered from dirty money so that they leave the rest of the accused’s wealth unaffected. That’s complete rubbish. The rest of the wealth is the front, the laundered money. If they leave that money in the hands of the accused, the authorities will effectively be enabling the laundering.
Same goes for the other change Jonathan Attard will be introducing. They’ll allow the accused to continue operating their business pending their trial. Their business is the laundry. That’s how they launder money. They use their businesses as fronts through which to pass dirty cash one end pumping clean cash out the other. Jonathan Attard is going to let Walter White operate his car wash.
Oh, wait. Maybe, he isn’t. Because Jonathan Attard explained that these changes to freezing orders are only being made to orders issued in connection with money laundering. The punitive measures that are unacceptable for alleged money launderers will continue to apply for alleged drug traffickers. Drug trafficking bad (true), money laundering good (false).
If people who are not yet convicted are presumed innocent, it shouldn’t matter that we’re talking about alleged drug traffickers or alleged money launderers. Anyone who’s alleged to have done something is, in the eyes of the law, presumed to have done nothing.
Why is it ok to punish alleged drug traffickers with blanket freezing orders but not ok to punish alleged money launderers with the same measures? Why is it ok for some people who have not yet been convicted of a crime to have to beg the courts for extra money to buy medicine, because they are accused of a crime they are still presumed innocent of, while it is not ok for some other people who have not been convicted of a crime to have to beg the courts for extra money to buy medicine, because they’re accused of money laundering?
Because Jonathan Attard may not count many alleged drug traffickers among his friends. His rolodex does include Keith Schembri, however. I’m not saying these changes are written for Keith Schembri. I am saying that the government does not consider money laundering as a real crime and its perpetrators as real criminals. They are wise guys who should be allowed to be unaffected by the laws of the land. For the government, money laundering is okay.
Although a freezing order pending trial is punitive, the real issue here is that that punishment is handed down after an inordinate amount of time of waiting for a conviction or acquittal to be determined. Think back to the alleged murderer waiting for trial in prison without bail. It’s one thing to be made to wait for trial for a year looking forward to having one’s day in court (and perhaps, conceivably prove one’s innocence). It’s altogether another to be made to wait for trial for 6 years.
Same goes for temporary freezing orders. Waiting for trial for a year under a freezing order is painful enough. Waiting for 6 or 10 years is altogether another order of punishment.
That’s for Jonathan Attard to fix. It would have been respectable for the government to commit to shorten waiting times for judgements where temporary freezing orders are handed down. But that would have required actual effort by the government. Reducing the effectiveness of freezing orders to the point of making them a mere nuisance rather than an actual preventive measure pending trial is much easier.
Long waiting times are a major problem Jonathan Attard should have been working on fixing. The other major problem he is not fixing is that too few people are charged with money laundering, certainly far less than we have good reason to suspect are guilty of it. Some of those candidates for money laundering charges are also prominent on Jonathan Attard’s rolodex. Think of Joseph Muscat, Michelle Muscat, Konrad Mizzi, Keith Schembri (for a raft of cases not including the ones he already has his assets frozen over), Chris Cardona, and others.
It is impossible to avoid suspecting that Jonathan Attard and the Labour government are concerned that Joseph Muscat could face money laundering charges in the near future. While protesting his innocence current laws would reduce Joseph Muscat to living on €13,000 a year. No more shiny jewels, ridiculous bags and eye-waveringly expensive shoes on Michelle Muscat’s instagram account, unless they face the additional charge of fraudulently evading a freezing order. It feels like once again all money launderers are being let off the hook, to avoid catching Joseph Muscat with one.
Challenged with the point of how poor the state’s record at prosecuting money launders is at his press conference, Jonathan Attard replied with a classic One TV non sequitur.
“The law had been drafted after a consultation process involving the Law Commissioner, prosecutor from the Attorney General’s Office, the State Advocate, the National Coordinating Committee on Combating Money Laundering, and the Asset Recovery Bureau,” he said.
That does not answer the question on why we’re making life for alleged money launderers easier, when so few are being prosecuted to begin with.
It does answer another question though: who was consulted?
The people on the Minister’s list are legitimate consultees though they are all internal to the government. We don’t know what they think about the changes. Is Jonathan Attard claiming that prosecutors agree the arsenal at their disposal when prosecuting money launderers should be stripped bare? Should we think that the national coordinating committee on combatting money laundering thinks they’d be able to coordinate the fight on money laundering better if they have less money to freeze pending prosecution? Does he want us to think that the Asset Recovery Bureau is content to have less assets to recover?
These consultations do not count purely because we haven’t heard what they said.
While Jonathan Attard moves us to tears about the suffering of people accused of money laundering, lamenting their “excessive hardship”, and having “to apply to the court to buy medicines”, no one spoke for the victims of money laundering.
Laundered money is nothing nicer than proceeds from crime. That could be violent crime, even the drug trafficking that Jonathan Attard insists will continue to be the subject of preventive asset freezes. Think about that. If they catch a drug trafficker trafficking drugs, they will freeze their assets pending trial. But if they don’t catch a drug trafficker trafficking drugs but catch the drug trafficker laundering the money they made trafficking drugs, they will no longer freeze their assets pending trial.
And it’s not just about drug traffickers. Anyone who makes money unlawfully launders their money to be able to spend it. Whatever they got it from, they shouldn’t have it in the first place. Whether it’s slaves, arms, smuggled goods, or fraud, bribery, or tax evasion, all that laundered money has been made on the back of victims. Jonathan Attard had nothing to say about the hardship suffered by those victims.
I do care about punitive measures, including temporary asset freezes, imposed on a person who turns out after trial to have been innocent. We should avoid that at all costs, even the cost of acquitting guilty people along the way. I would argue for the shortest reasonable waiting time for due process: and I can only ask the government to do that because they’re the only ones who can.
But having considered that I couldn’t care an ounce for the hardship suffered by money launderers. Their assets – all their assets – should be taken away (as the law already provides). However clean a portion of their wealth might be, it should be incumbent on them to prove it is, because otherwise they should not be rewarded for having been successful in committing the crime of cleaning dirty money.
And even if taken away from them temporarily, pending a permanent confiscation of their assets after a definitive court sentence, that wealth should be given to their victims to compensate them for their suffering.
A first victim of a drug trafficker is the addict. But a victim of a drug trafficker who has laundered the money they made from selling drugs to the addict, is you, for having to live in a society where the community’s wealth is stolen and used by criminals. It’s to you and to your society that that wealth should be given. While frozen temporarily you should be able to use it to the point that it is kept in a state that it may be returned to the accused if they’re acquitted. When permanently confiscated that wealth should benefit the community, and most definitely not the criminal’s relatives. My heart goes out to the glamorous wives of serial criminals who never wondered where their husband’s money came from. But that doesn’t mean I think they should keep their jewels.
That is how we fight organised crime. Jonathan Attard is worried about the criminals having to ask the court for permission to use money they stole to pay for their children’s school fees. Who’s worried for the families who could never afford those school fees because they live in the shadow of the organised criminals Jonathan Attard is so keen to protect?
If Jonathan Attard had broadened his so-called consultation beyond the people who work for him and who would not contradict him publicly if he were to lie, even by implication, about what they really thought of his law, we would have told him this is the wrong move.
Our fight against money laundering and organised crime has never been strong. Now it’s going to be much weaker. It is truly a mafia state that boldly amputates its arms with which it could have, should have, reached the mafia.