Former PL candidate Reno Borg sworn in as financial services arbiter

Former Bank of Valletta chairman and Labour candidate Reno Borg officially appointed as Malta’s first financial services arbiter.

Reno Borg (centre) sworn in as financial services arbiter
Reno Borg (centre) sworn in as financial services arbiter

Former Bank of Valletta chairman and Labour candidate Reno Borg has officially been appointed as Malta’s first financial services arbiter.

He was sworn into his new role during a ceremony attended by finance minister Edward Scicluna and Attorney General Peter Grech.

As arbiter, Borg will be tasked with making legally-binding decisions on consumer complaints of financial service products, and will have the power to order up to €250,000 in compensation from financial operators.

One of his first tasks will be rule on a long-standing case by 2,300 investors who lost their money in BOV’s La Valette property fund in 2011 and were only partially compensated by the bank. Finco managing director Paul Bonello, who represents the investors, told MaltaToday last week that hundreds of investors have requested that the new financial services arbiter hear their case. 

The Malta Financial Services Authority had found the bank guilty of misselling the fund to inexperienced investors and ordered it to fully compensate them for their losses, a demand that the bank refused.

Back then, the Labour Opposition had pledged that a future PL government would use its power to elect BOV’s chairman to ensure that “serious negotiations” take place between the bank and the La Valette investors. The Nationalist government had warned that such a political decision could ultimately harm BOV’s shareholders.

Reno Borg unsuccessfully contested the 1996 general election under the Labour ticket, and was appointed BOV chairman following his party’s election to government. Upon the change in government in 1998, he was nominated by Labour to serve on the Broadcasting Authority – a position he retained until his nomination as financial services arbiter.

He denied that his political history risk undermining his independence.

“I have been out of the political scene for 20 years now, and I was never accused of political discrimination during my time as BOV chairman,” he had told MaltaToday.

However, Opposition MP Kristy Debono warned that his appointment is “dictated by political patronage”.

Borg is a qualified arbitrator and has chaired the Malta Engineering Board, the Maltacom Disciplinary Board and the Malta Shipyards Appeals Board in the past.

As financial services arbiter, Borg will earn a salary of €65,000 – equivalent to that of a superior court judge.
He will be assisted in his duties by an administration board composed of Geoffrey Bugeja and Peter Muscat, who were selected by the finance minister; and lawyer Anna Mallia, who was selected by the consumer affairs minister.