Bank to appeal court ruling over alleged Ponzi scheme funds
Civil Court ruled that accounts can only be frozen under the Prevention of Money Laundering and Terrorism Financing Act only if there is a court order.
Bank of Maldives (BML) said on Wednesday that it would file an appeal over Civil Court's ruling on Tuesday that the bank had wrongfully seized the account of King's Capital Holdings, which is alleged to have run a Ponzi scheme by extorting huge sums of money from people in the name of forex trading.
The bank deactivated King's Capital's account on the ground that it was illegal for the company to do online trading business without obtaining a licence as an investment fund. The bank temporarily withdrew the account after 14 days.
Civil Court Judge Mariyam Waheed noted in her ruling that accounts can be frozen under the Prevention of Money Laundering and Terrorism Financing Act only if there is a court order. Since no such order has been obtained in the present case, the bank cannot deactivate the company’s account, the court said.
The judge also ruled that the company could seek compensation for breach of contract from the bank. The court, however, ruled that there was no need for the trial court to decide on the other two objections filed by kings.
"The bank believes that the High Court will take into account the judicial and legal loopholes which have not been taken into consideration in the judgment of the Civil Court and will take a fair decision in view of the appeal," BML told reporters in a text message.
Police recently raided Alhan's office and residence. Without giving much details about the operation following a court order, the police confirmed that only a search was conducted in connection with an ongoing case.
