The European Central Bank (ECB) has decided to cancel the licence of Malta-based Pilatus Bank after its chairman Ali Sadr Hashemi Nejad was accused for money laundering charges, Reuters reported citing two unnamed ECB officials.

The bank was accused of processing illegal payments for the Azeri and Maltese leadership. During its probe, the ECB found serious gaps in the supervision of Pilatus.

The ECB’s supervisory board has already agreed to revoke the bank’s licence, one ECB official told the publication; however, the decision will be finalised only after some legal issues are resolved.

Another ECB official told the news agency that the procedure of cancelling the bank’s licence is under way but the ECB is more careful on its outcome until legal hurdles are cleared.

In July this year, Malta’s banking watchdog Malta Financial Services Authority (MFSA) requested the ECB to cancel licence of scandal-hit Pilatus Bank.

Earlier in March, the MFSA suspended the operations of Pilatus Bank after the US captured Sadr Hasheminejad on allegations of money laundering and breaching US sanctions on Iran. Subsequently, the MFSA froze the assets of the bank and urged the ECB to withdraw its licence.

Sadr Hasheminejad was found involved in a scheme to illegally move payments worth $115m from Venezuela to Iranian individuals.