Nationalist MP Kristy Debono is standing by allegations of lending malpractice at Bank of Valletta despite an internal audit finding no evidence to back her claims.
She insisted yesterday that the internal investigation “left much to be desired”, as it had not probed individual files.
Ms Debono has refused to make public the information she has, insisting that it would compromise her sources, but stands by claims that loans were issued to people who were not credit worthy and companies with connections to people in power.
The allegations were first made in Parliament last January.
On Wednesday, the bank said its internal audit department had issued an interim report on its investigations, claiming “so far and on the information available”, the probe found no evidence the allegations were founded.
The bank forwarded the report to both the banking supervisors and its external auditors. The statement gave no further detail, and it remains unclear whether the investigation actually probed individual client files. A BOV spokeswoman yesterday would not say how many files, if any, were reviewed.
The internal investigation was conducted in accordance with standard internal audit practices
“The internal investigation into allegations of lending malpractice was conducted in accordance with standard internal audit practices and procedures,” she said when asked how the investigation had been conducted.
She added it was not the norm to publish internal reports. However, Ms Debono insisted the bank should at least say whether verifications were carried out on client files. “The public deserves this information,” she said, appealing to the regulator to carry out an independent investigation. She had already written to the Malta Financial Services Authority about the allegations, which in turn forwarded the matter to the banking supervisors, a body made up of the European Central Bank and domestic regulators.
I have heard nothing fromthe banking supervisors,” she said yesterday.
Last month, MFSA chairman Joe Bannister, who heads the banking supervisory authority, had said he was barred by law from divulging any information, including whether an investigation had actually started or not.
Ms Debono alleged pressure on loan managers would have been made by higher management, and that this started soon after the change in administration in 2013. She insisted Finance Minister Edward Scicluna had nothing to do with the matter.
The government of Malta has a 25 per cent stake in Bank of Valletta and the right to appoint the chairman.
kurt.sansone@timesofmalta.com