Minister keeps up fight on Bannister and Cayman fund directorship

Education minister Evarist Bartolo rekindled an old feud with financial services regulator’s chairman, Prof. Joseph Bannister, who as chairman of the Malta Financial Services Authority came under fire for the way the regulator handled complaints from Bank of Valletta clients who lost some €50 million in savings in the La Valette property fund.

But in the wake of the Panama Papers revelations, which revealed Labour minister Konrad Mizzi and the Prime Minister’s chief of staff Keith Schembri had set up offshore companies in Panama, Bartolo has also accused Bannister of having a serious conflict of interest.

Bannister has for years acted as director of several funds run by financiers Sloane Robinson, amongst them the SR Global Fund and the New Greater China Fund.

Finance minister Edward Scicluna, who yesterday was in Amsterdam, said he cannot comment on the allegations made. “But definitely I will be going into them to a degree as my remit and the law would allow me to,” the minister said.

Bannister is also a director of Sloane Robinson funds SRH Eclipse and SR Phoenicia.

But the MFSA chairman has refused to comment on his association with a company that in the past was ordered to pay millions in taxes it had avoided to pay.

Hugh Sloane and George Robinson are two of Britain’s wealthiest men and among the Conservative party’s most generous donors. In 2004, the hedge fund managers put £24 million of bonuses into a dividend scheme which allowed them to escape £13 million in income tax and national insurance contributions to HM Revenue and Customs. A tribunal ordered them to pay back the money in 2012, after it ruled that they had created ‘money-box companies serving an essentially mechanical purpose’.

Bartolo has been an open critic of energy minister Konrad Mizzi, suggesting it was untenable for a minister to stay on after having opened an offshore company in Panama. “Given the public discussion on the Panama Papers, why two weights and two measures? In all this there is an important question to be asked by all of us. Should there not be some level of expectation that persons entrusted with public office ultimately are driven to ‘do the right thing’?” Bartolo asks in his MaltaToday column.

“Is the involvement of the chairman of Malta’s financial services regulator with such offshore outfits correct behaviour? If these funds go astray, it will be the collective responsibility of all members of the board. They will be held accountable to the public. What will be or indeed is the potential damage to Malta and the financial services sector?”