The sins of the past, conveniently forgotten

Few seemed to have batted an eyelid when Malta’s top bank, Bank of Valletta, announced it was throwing in the towel on a contentious €360 million claim in the Italian courts, and that it was paying out €187 million in an out-of-court settlement with the Italian bondholders of a defunct shipping company.

The Deiulemar case might be soon forgotten like so many other instances of bad governance. BOV shareholders are traditionally ordinary, hardworking folk who invested their savings in a ‘robust’ bank. Except that they are frustrated at not receiving dividends while the bank has to keep digging into its pockets to pay off its litigation expenses – not just for Deiulemar, but also for the Swedish pension fiasco and a few years back, the La Valette property fund saga.

New board members and management naturally are left to pick up the pieces of the wrongs carried out from years back, but it seems important to remind readers that back in 2009, BOV was chaired by Roderick Chalmers and run by CEO Tonio Depasquale. They seem to be hardly mentioned in this saga. Perhaps it’s because of the mistaken impression that back in 2009, financial impropriety was just a fairy-tale; that back then, Malta was awash with shady trusts and foreign companies booking their profits into the island with no due diligence or source of wealth checks, and yet it was still the land of milk and honey, not the dreaded mafia state some claim it to be today.

It is unfortunate that people who want to occupy the mediatic or political space without any respect for history tend to fall into the easy trap of casting guilt on anyone remotely associated with some ‘villain’ or shady business type. Malta is replete with people whose sole sin has been to be connected or associated with the wrong types.

And yet, and I will say this with much conviction, there is a different yardstick used for some types who were not unfortunate enough to grow on the wrong side of the lawn – a group of boys and girls whose breeding and even political allegiances means that even calling them into question, is taboo.

I remember it clearly when MaltaToday started reporting the beginnings of the fall-out from the La Vallette property fund scandal. It was an €80 million loss in value which BOV’s head honchos assured us, was being blown out of proportion. During one of the first press conferences for journalists after announcing their annual results, BOV Chairman Roderick Chalmer pointed his finger at Matthew Vella, the journalist following the story and present for the press conference, for having apparently dared not to follow the bank’s official line. The words used then implied that the bank’s directors were umbraged at the suggestion that they had countenanced some internal wrongdoing. But the facts of the story are a matter of public record: the bank mismanaged savers’ investments.

What is strange now is that while the Deiulemar story is as serious as any other financial scandal, the matter seems to have been conveniently ignored by those who paint a bleak picture of Maltese society. How come these particular leaders of Malta’s finance world, those who have long lived off the financial services world, tend to also be the same types who will complain about the country going to the dogs or moan about greed taking over our souls when they hardly need to look any further other than their own industry?

Archbishop Charles Scicluna’s address to MPs during Saturday’s inauguration of the new parliament should have also mentioned the greed and hypocrisy of the classes who, deposed of their traditional power, never stop to consider the beam in their eye.

And back to BOV, it must be reminded that the bank’s trusts for the Deiulemar case were created around 2009 after taking on the shipping group as a client from a Swiss Bank, the Banco Svizzero d’Italia Trust Corporation Ltd Malta, owned by BSI of Lugano. That trust was registered at BOV’s head office in Zachary Street, Valletta. Someone surely must have been benefited from attracting such a client to the bank.

The question is: who? That’s something that the bank seems intent on not saying. Paying out €183 million in shareholders’ funds, on the other hand? Settling its litigation costs on the Falcon Funds and La Valette property fund fiascos? That’s ok, of course. It’s only other people’s money, after all, it’s only their dividends that are not being paid out, and it’s only a share price going south after all.