Labour MEP targeted by transparency group over alleged conflict of interest

Corrected title on Thursday, 24 March at 6pm.

Labour MEP Edward Scicluna has denied a conflict of interest as a member of the European Parliament’s economic and monetary committee, and his non-executive directorships in the HSBC Malta Funds SICAV plc and Structured Funds SICAV plc.

Scicluna was revealed by a Reuters special report of having “co-wrote laws for hedge funds” while still chairman of HSBC Malta’s two investment funds.

But in reaction to calls for an investigation by transparency group Alter-EU, Scicluna stated that in his committee role, he had drafted reports and opinions, shadow rapporteurships and submitted amendments “only on the euro and the European Central Bank.”

“I have not submitted any amendments related to the financial industry, let alone ‘drafted hedge fund laws’ as erroneously claimed,” Scicluna told The Parliament magazine.

“I have to date myself refused to hold one-on-one meetings or lunches with financial institutions or lobbyists and have only attended public meetings which are organised by the industry and attended by other MEPs, within parliament’s precincts.”

Scicluna reiterated these denials to Reuters: “The investment funds are equity and bond funds for small savers and pensioners for which HSBC is the manager, and my relationship with HSBC is no different from any depositor whose money is administered by a bank.”

Alter-EU is calling for an investigation into all the second jobs currently held by MEPs and the urgent development of strict rules for second jobs, including a ban on all jobs that involve lobbying or that lead to conflicts of interest.

Scicluna said that all his activities are declared on his CV and financial declaration, and that two Maltese Sicavs he has chaired since before his election to MEP “are not owned by HSBC”.

He even agreed with Alter-EU’s position on the need for an ethics committee to act both as a watchdog and a provider of guidance “to those seeking its advice regarding ‘second jobs’ undertaken by MEPs, including myself.”

An in depth report from Reuters last week revealed that numerous MEPs hold second jobs that lead to obvious conflicts of interest, all of which go unchallenged due to the lack of adequate ethics rules for MEPs.

The EP has also launched an investigation into how three MEPs were caught agreeing to accept secret payments to alter laws by the UK’s Sunday Times newspaper. Two of them have stepped down as MEPs while the third, Romanian socialist deputy Adrian Severin, resigned from the parliament’s S&D group on Tuesday.

Austrian Ernst Strasser, a former interior minister, Romanian Adrian Severin, a former deputy PM, and Slovenian Zoran Thaler, each put forward amendments believing they would be paid for this work with a €100,000 annual salary, a consultancy fee or both.

Alter-EU claimed that Scicluna’s involvement with two investment funds run by the banking giant HSBC clashed with his parliamentary committee position. Scicluna is deputy chair of the economic and monetary affairs committee.

An Alter-EU spokesman said, “Parliament needs stronger transparency and ethics rules to ensure that MEPs do not receive money, gifts, or hospitality from industries they are regulating.

“MEPs should put their shares in a blind trust if they are related to their work in parliament. Rapporteurs on parliamentary reports should not have a financial interest in the industry affected by the legislation at stake.”

Even former Commissioners like former Maltese foreign minister Joe Borg was criticised for landing a second job soon after his EC role. Borg was reported to be getting a ‘double salary’ as part of his transition into the job market from his former Brussels post, receiving both a salary from Fipra, a PR consultancy lobbying on maritime issues, and an €11,000 monthly allowance from the European Commission.

The Commission pays the transitional money for three years after a Commissioner is not reappointed, and the sum is between 40-65% of the basic salary of a commissioner (€20,278 per month), depending on the length of service.