The Supreme Court said Malta's arguments were "vague" and noted that Maria Efimova, a 36-year-old ex-staffer at Pilatus Bank, has claimed her life would be at risk if she was extradited.
Efimova is widely believed to have been a key source of Maltese investigative journalist Daphne Caruana Galizia, who was killed by a car bomb last October as she lifted the lid on widespread corruption in her homeland.
After the killing, her sons called for Malta's Prime Minister Joseph Muscat to resign, alleging he was overseeing a mafia state.
Pilatus Bank has accused Efimova of embezzling 5,000 euros ($5,900)
After initially fleeing to Crete, Efimova surrendered to police in Athens in March and then released the following month.
She has denied claims by the Maltese government that she is a Russian spy.
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