Italian police arrest 12 in swoop on Malta based insurance company

Italian authorities have called on the Maltese government to provide information regarding the set-up of an insurance company that was liquidated in Malta and whose directors are facing charges of fraud amounting to €30 million.

European Insurance Group, that was liquidated and struck-off the Malta Financial Services Authority register after becoming insolvent last year, was placed under the administration of a local audit firm.

The company – always based in Malta - sold motor insurance policies in the Calabria region for three years, however clients were alerted that their policies were no longer valid and that they had to seek cover with other insurance companies as EIB could no longer service them.

The letter, signed by a Maltese auditor, was immediately signaled to the National Consumer’s Association in Italy that opened an investigation, and passed on the conclusions to the police.

Neapolitan Magistrate Fausto Zuccarelli signed warrants for the immediate arrest of the two main directors of EIB, namely Paolo and Vincenzo Viscione, after it was discovered that the Malta based company that operated from offices in Old Bakery Street in Valletta was used to siphon millions of euros through a series of illicit financial operations.

While the Viscione’s were arrested, the Italian Guardia di Finanza (fiscal police) also raided 30 addresses, arresting another 10 people, most of whom are accountants, notaries and brokers, who are all facing charges of aiding the Malta based company and other companies to launder the takings from illegal financial operations.

The fraud is said to have also uncovered a network of ‘friends of friends’ who covered up for each other, and shared the profits from the fraud.

Among the people mentioned in the affair is a prominent centre-right MP and undersecretary Marco Milanese, known to be very close to Prime Minister Silvio Berlusconi’s finance minister Giulio Tremonti.

Milanese is reported to be named in the investigation nicknamed ‘Malta’ and is expected to be questioned on alleged “favours” he may have pulled for the network of professionals that also financed his electoral campaigns.