The board of inquiry investigating how Malta Financial Services Authority General Counsel Edwina Licari was recruited to the new position has confirmed former CEO Joseph Cuschieri broke the rules to accommodate her.

The inquiry by former Chief Justice Joseph Azzopardi and lawyer Mark Simiana found that Cuschieri had alerted Licari to the vacancy for the top legal position at the financial services regulator.

It also found that although three applicants had applied for the position, Cuschieri only interviewed Licari.

It was also Cuschieri who dictated Licari’s terms and conditions, according to the inquiry, and he changed all the goalposts to recruit his former colleague over from the Malta Gaming Authority.

Not only had Cuschieri created the position of General Counsel specifically for Licari, but while the position was initially advertised as a three-year fixed-term duration, Licari ended up with an indefinite contract.

The inquiry found that three people had applied for the vacancy and that “all three applicants should have been interviewed because the other applicants were eligible to apply and had sufficient qualifications and experience to be considered. Besides this, the surprisingly low number of applicants did not justify the shortlisting.”

The board also noted that Cuschieri admitted to having “alerted Licari” to the vacancy.

Noting that Licari’s recruitment had also contravened an Office of the Prime Minister directive when Cuschieri had not bothered to ask for approval before changing the rules, the inquiry found that “it also appears that the call for applications referred to a three-year contract, whereas Licari was employed on an indefinite contract”.

The Shift can confirm it was Cuschieri who gave written instructions for what had been advertised as a three-year to be changed into a far more desirable indefinite contract.

The Shift can also confirm that it was Cuschieri who dictated, also in writing, that Licari be placed on an €85,000 basic salary with a 15% performance bonus, a special car allowance of €6,500 per annum, a €4,000 expense allowance and a 5% annual basic salary increase.

This amounts to a remuneration of around €120,000, which will keep rising indefinitely until Licari leaves the MFSA.

The board concluded that while Licari herself had done nothing wrong, Cuschieri had broken recruitment rules to fit her into the MFSA, which he had joined only a few months earlier.

Licari is still employed as the MFSA’s General Counsel, and it is unclear what the MFSA is doing to rectify the irregularities the inquiry found in her contract.

Cuschieri and Licari had already worked together at the Malta Gaming Authority for years and travelled the world together, attending conferences and business meetings at taxpayers’ expense.

Shortly after disgraced former Prime Minister Joseph Muscat handpicked Cuschieri as MFSA CEO, Licari tendered her resignation from the MGA and applied for the position at the MFSA.

Cuschieri chose Licari for the position after just one short interview he handled with then-Chairman John Mamo.

Cuschieri resigned from the MFSA in 2020 shortly after the inquiry into the trip he and Licari took to Las Vegas with Yorgen Fenech and Charlene Bianco Farrugia, the secretary of former OPM chief of staff Keith Schembri. The trip was entirely financed by Fenech.

Cuschieri, who was kept on the government’s payroll, insists he did nothing wrong.