In Malta, a legal dispute involving a fintech firm and a prominent newspaper has brought the relationship between financial regulation, press freedom, and legal processes into sharp focus. The case centers on a court-imposed temporary injunction, colloquially termed a “gag order” by the newspaper, which prevents the publication of a story.
On August 9, the Times of Malta published an editorial titled, “We’ve been gagged. This is why it matters.” The publication stated it was served with a court order on July 25, which prevents it from publishing a story it had not yet written. This injunction was sought by Papaya Ltd., an e-money firm that was fined by Malta’s Financial Intelligence Analysis Unit (FIAU) for anti-money laundering (AML) failures. The penalty under appeal was imposed due to a compliance review that took place in 2020 [Editor’s note] The newspaper asserts that its journalist was merely asking questions and that the company’s legal action constitutes an attempt to “abort a story.” The editorial claims this is the first time in its history it has faced a gagging order of this type, raising concerns about a “chilling effect” on investigative journalism. It highlights the role of the press as a “public watchdog” and argues that prior restraint is not permissible unless there is an imminent and irreparable threat.
The Institute of Maltese Journalists (IĠM) denounced the temporary injunction, stating it “denounces the temporary court-imposed gagging order on the Times of Malta at the request of Papaya Ltd.” The IĠM referred to the suspension of a human right as a “grave request” and urged the court to “expedite matters and hear the case with urgency.” It further stated that the right to know and to inform should “trump the company’s request to stifle investigative reporting,” emphasizing that “silencing the press through legal injunctions undermines the essential role of journalism as the fourth pillar of democracy.”
In a response sent to The Fintech Times on August 11, Papaya Ltd. provided its perspective in an article titled, “Balance, Not Bias: A Call for Responsible Journalism.” Papaya describes its legal action as seeking legal protection and not as an attempt to “gag” the press. The company highlights a key detail regarding the FIAU fine: while the penalty was issued, it is not a final decision as it is currently under appeal. The firm states that it considers it inappropriate to label the act of appealing to legal instruments as an abuse, arguing that these mechanisms exist to protect all parties. Papaya also stated that it is a fully licensed financial institution and is “legally prohibited from disclosing certain client-related information” due to local and EU laws, including financial secrecy and confidentiality regulations. Papaya stated that the questions from the Times of Malta “appear to rely on – or would lead to the exposure of – confidential client and procedural information.” The company also claimed that it had offered to meet with the newspaper’s editorial team but that these offers were “ignored.” Papaya challenged the use of the term “gagging order,” calling it an “emotionally charged label.” It argued that a “healthy democracy requires strong journalism” but that this must coexist with “confidentiality, legality, and procedural justice.” The company also claimed that a right of reply request it submitted to the Times of Malta was declined by the editorial team.
The legal action has placed the focus on the balance between press freedom and the legal obligations of regulated financial institutions. While the IĠM and the Times of Malta have framed the issue as an attack on investigative journalism, Papaya has presented its actions as a necessary adherence to confidentiality laws. The temporary injunction is pending a full hearing in the Maltese courts.
