In October 2020, the Malta Financial Services Authority’s (MFSA) Board of Governors commissioned a review to carry out necessary verifications about a possible breach of ethics by former CEO Joseph Cuschieri and General Counsel Edwina Licari. The report, issued in Nov 2020, concludes that Licari need not face such charges. However, the report also implies problematic conduct during her time as an MGA executive and sheds light on the Maltese way of doing supervision.
MFSA Forced To Make Report Public
The portion of the 2020 report pertaining to Edwina Licari was released by MFSA on March 29, 2023. Not voluntarily, however.
On 1 March 2023, the MFSA received a decision notice from the Information and Data Protection Commissioner (IDPC) in relation to a Freedom Of Information (FOI) request submitted to the Authority which asked for a copy of the Board of Review’s report. Thus, a copy of the 2020 report is being made available on the Authority’s website.
The Las Vegas Trip
One of the biggest scandals surrounding Joseph Cuschieri and Edwina Licari was a trip to Las Vegas in 2018, which was paid for by Yorgen Fenech, an entrepreneur who is now in prison. At the time of the trip, Licari was legal counsel to the Malta Gaming Authority (MGA), a job which included the supervision of Yorgen Fenech‘s companies. Licari also made this Las Vegas trip as a representative of the MGA, according to the report. How can that be possible if Fenech is paying for all of this? How can the MGA not have a conflict of interest? The report states:
… at the time during which the trip to Las Vegas, which was funded by Yorgen Fenech, took place, Dr Licari was not yet an employee of the MESA, and in fact, was still employed at the Malta Gaming Authority (MGA). Dr Licari held that this trip was in fact authorised by the MGA, and she was assigned to participate in this same trip in an official role, as a representative of the Authority. It is clear that this Board is bound by its terms of reference, which do not include or comprise Dr Licari’s obligations or duties as an employee of the MGA. Consequently, this issue falls beyond the Board’s review.
MFSA report on Edwina Licari (link)
Yorgen Fenech is a Maltese entrepreneur who, among other things, operates casinos that require a license from the MGA. As reported by FinTelegram (and other media), Edwina Licari is said to have been very friendly and supportive of Fenech in her work for the MGA. According to the MFSA report, Licari has known Fenech since she was a child, the report says.
Cuschieri stepped down as CEO of MFSA in November 2020, at the time of the report’s release.
The Blind Eyes
So Licari was acquainted with Fenech since childhood, and yet she doesn’t even try to avoid conflicts of interest. In Maltese newspapers, emails between Licari and Fenech were published in which she gave Fenech tips on obtaining the MGA license and evidently drafted the necessary license filing (see left). And then the Las Vegas trip at Fenech’s expense.
Did it not occur to Edwina Licari or the MGA that she had a clear conflict of interest here and may have been biased. At this point, Joseph Cuschieri was CEO at MGA together where he worked with Licari before he was appointed as CEO of MFSA in 2018. At the time of the Las Vegal trip, in 2018, Cuschieri was transitioning from the MGA to the MFSA. Licari was still employed as legal advisor to the gaming authority.
In November 2019 Fenech was arrested as a suspect in the murder of the investigative-journalist Daphne Caruana Galizia. He is a key figure in the 2019 Malta political crisis and 2019 protests in Malta.
The Bigger Scandal
After reading the now published report, the question now is what is the bigger scandal. The behavior of Joseph Cuschieri and Edwina Licari or the report that was apparently written with blind eyes. The report reveals how surveillance cannot work in Malta and why the country was rightly greylisted. Malta seems to be a banana republic in the middle of the EU.
