Who protects consumers against mis-selling scams?

Article as Published on the Sunday 20th January 2013 in the Sunday Independent

Source: George Mangion¸ PKF Malta 

Political leaders are up in arms doing their level best to attract votes by promising superlative living conditions should we give them the precious No one vote on the 9 th March. This charade may be the norm in an island when the relative majority garnered by the elected party at the last election was only 1500 votes. So far the polls conducted by different agencies point to a 24¸000 vote lead by the opposition but as in sports the fixture is only won when all votes are counted in 8 weeks time not a moment before the referee blows the final whistle. The uncannily feeling of having too much attention bestowed on voters once every 5 years is excusable since upon closer examination we observer that political parties pride themselves to have unique priorities and agendas. Reading the electoral manifesto of eligible parties one notices a high level of convergence albeit one gets the impression that the version drafted by the incumbent is different . Naturally as the PN has been in power for over five consecutive legislatures it is extra careful not to step on toes of its canvassers ¸party apologists ¸financial donors and is discerning to meet the exigencies of its lobby groups. Taking this into consideration one can be excused for showing surprise and question why the finance minister has taken a back burner approach when asked to help thousands of BOV clients who invested in the La Valette Property Fund which went belly up 4 years ago losing around €50 m. It was only after a number of judicial protests filed by savers  that the regulator took notice and moved to appoint independent experts so as to examine the transactions and dealings by BOV who acted as the custodian of the Fund. MFSA conducted and fined BOV after concluding three investigations – the bank’s breach of the fund’s investment restrictions¸ misselling the fund to people who were not¸ legally speaking¸ ‘experienced investors’¸ and alleged insider trading – so far over a period of almost three years it has published none of these reports. The claimants also submitted evidence of improper use of price-sensitive information not in the public domain resulting in withdrawal by privileged investors of more than €16 million from the fund at a price ranging between €1.1345 and €1.071 per share at the same time that unwary investors continued investing in the fund. According to Roderick Chalmers¸  the government-appointed ex-chairman at Bank of Valletta he treated the claims of savers who lost their shirt with disdain. At one time at the height of the judicial protests he told them to “put up or shut up” and invited them to proceed with legal action¸ yet he later mellowed his view as the bank made a conditional offer of 75 cents for each qualifying unit. All along none of its officers offered to resign. They refuted responsibility and such an offer was made without prejudice.  This offer was tied to the condition that once accepted the claimants forfeited their rights for further legal action against BOV. The logical question that follows is that once the investors were refused access by MFSA to its own investigative reports¸ one of which involved the breach of investment restrictions how can savers judge for themselves if the bank’s 75c offer is indeed fair or not? In a arrogant manner while BOV was being investigated by MFSA it refused liability while meekly stated that it fully respects the rig