Crystal Finance Investments, a financial services company that made headlines in 2014 after failing to inform clients that their investments were doing poorly, has surrendered its operating licence, bringing to a close a long-running saga that has seen multiple lawsuits, penalties, and persistent rumours of ties to former European Commissioner John Dalli, who is currently in court over a €60 million bribery scandal.
The Malta Financial Services Authority (MFSA) made the announcement that the company had voluntarily requested the cancellation of its license to operate investment services as part of its standard notification procedure. The company ceased to be licensed by the MFSA as of 30th June 2022.
Since 2016, Crystal Finance has been owned by a major player in the local financial services industry. The agreement was subject to all the necessary due diligence and regulatory approvals, amongst which that by the MFSA.
The company became the centre of controversy when a number of its clients accused it of mismanaging their investments. They turned to the financial arbiter’s office, which awarded a number of them compensation after finding that the firm, in one case, “unilaterally raised a client’s risk appetite profile to tally with an investment sold to her, while other cases related to its failure to inform clients of the “negative trajectory” of their investments.
At least one of these decisions was also upheld by the court of appeal.
Further controversy is related to its previous owner, Alfred Mifsud, a former deputy bank governor who resigned following corruption claims about his time heading Mid-Med Bank between 1996 and 1998.
Mr Mifsud then went on to lead the Labour Party’s media production house ONE Productions. He currently sits on the BOV board of directors where he chairs the risk committee and is a member of the compliance and anti financial crime committee and audit committee.
Mr Mifsud owned the firm in partnership with Eric Schembri, of insurance company Allcare. He is also the brother of Tarcisio Mifsud, an oil trader at the heart of the oil bribery case that erupted in 2012, which remains unresolved.
Crystal Finance was in the papers once again due to the appearance of Claire Gauci Borda, daughter of Mr Dalli, on its board of directors.
Ms Gauci Borda is currently in court in a separate case, charged with money laundering, fraud, misappropriation of funds, making a false declaration to a public authority and falsification of documents
The company is also believed to have been former Prime Minister Joseph Muscat’s only private employer, as confirmed by the Labour Party in 2013, prior to the March election which it won in a landslide. Dr Muscat resigned in 2019 in the face of mass protests related to his office’s alleged criminal links.
Daphne Caruana Galizia, the journalist who was assassinated by a car bomb for revealing the close ties between Government and business, claimed that Mr Dalli used to hold secret meetings with lobbyists in Crystal Finance’s offices during his tenure as European Commissioner.
Mr Dalli stands accused of condoning his political canvasser’s solicitation of a €60 million bribe to help overturn an EU-wide ban on snus, a form of smokeless tobacco.
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