Joseph Cuschieri slammed as MFSA hit with €414,000 compensation

The disgraced former CEO of the Malta Financial Services Authority (MFSA) has been found guilty by the Industrial Tribunal of arbitrarily sacking a Chief Officer after the latter challenged him on various abuses and irregularities.

In an unprecedented ruling, the Tribunal slammed the MFSA with record compensation for the sacked officer, including moral damages amounting to a staggering €414,000, and ordered him reinstated to his exact position.

While the massive compensation – a record in the Tribunal’s history – will have to be paid through taxpayer funds, the decision further embarrasses Prime Minister Robert Abela, following his decision, earlier this year, to give Cuschieri a new lucrative government position at Project Green,  despite his proven history of irregularities.

The irregular sacking dates back to September 2019, when Reuben Fenech, a former head of the National Statistics Office and Chief Operations Officer at the MFSA, was called by Cuschieri to his office and told he was dismissed on the spot. No reason was given for the decision.

Following five years of court hearings, as a result of a challenge filed by Fenech, the Tribunal, led by Joseph Gerada, found Fenech’s dismissal irregular while throwing out all the arguments made by lawyer Matthew Brincat from Ganado Advocates on behalf of the former disgraced MFSA CEO.

In a strongly worded judgement, the Court found that Cuschieri had decided to terminate Fenech’s employment without the approval of the MFSA’s Board of Governors.

The Tribunal slammed Cuschieri for steering the financial services regulator like some fiefdom and breaching all the rules, including recruitment and public procurement.

While the MFSA and Cuschieri’s lawyers tried to find some reason to fire Fenech after his dismissal, claiming incompetence and non-performance, the Tribunal decided it was Cuschieri who was completely in the wrong. Fenech was only doing his job trying to uphold the rules and steer the organisation away from Cuschieri’s irregularities.

Cuschieri admitted that he hired people he knew and ordered consultancies and other contracts without following rules or obtaining authorisation.

The Tribunal said that while Fenech was trying to give Cuschieri professional advice to follow the rules and avoid irregularities, Cuschieri considered him a stumbling block instead of a diligent officer trying to follow the rules.

“It seems that the CEO (Cuschieri) had a problem following the established rules of a public organisation he was entrusted to lead,” the Tribunal said.

“The officer (Fenech) was right to insist that decisions had to follow the rules and respect transparency and good governance, especially if these were being taken by the highest officer of a public organisation. The style adopted by the CEO made the COO (Fenech’s) job impossible,” the ruling stated.

The Tribunal decided that Fenech’s approach to his job was commendable, and the CEO was wrong.

While ordering the MFSA to reinstate Fenech to his previous job, the regulator will also have to fork out a massive €419,000 in compensation for the income Fenech lost due to Cuschieri’s irregularities.

Sources at the MFSA told The Shift that while Cuschieri was no longer at the organisation, having resigned after being found guilty of many other irregular and unethical behaviour, legal advice is being sought to determine whether he should be held responsible.

The situation is even more embarrassing for Prime Minister Robert Abela, who earlier this year accepted Minister Miriam Dalli’s advice to put Cuschieri in charge of the €700 million Project Green agency.