Outgoing MFSA chairman Joe Bannister. Photo: Matthew Mirabelli

Financial services watchdog Joe Bannister was involved in a British Virgin Islands-based company that invested in a Russian mining venture, leaked documents show.

E-mails sent to offshore services firm Appleby by the company behind the Russian mining venture referred to Prof. Bannister as being part of “management” in the BVI firm ACP Special Situations No. 2 Limited.

ACP Special Situations serves as an investment vehicle for the London-based company ACPI, chaired by Alok Oberoi, formerly of Goldman Sachs, who headed the American bank’s international private wealth management department.

Prof. Bannister told the Times of Malta his role in the BVI-based company was limited to non-executive director. He said he told ACP Special Solutions he wished to resign his role in 2015.

The request was processed in June 2016, he said.

Asked by this paper’s reporting partners Le Monde why he never publicly declared his role in the company, Prof. Bannister said he was “never asked to”.

When it was pointed out to him that the Times of Malta had filed a freedom of information request asking for his declaration of financial interests, the chairman of the Malta Financial Services Authority said it was up to the government to handle the request.

The leaked documents show that Appleby was sent a copy of Prof. Bannister’s passport and utility bill as part of a due diligence process into the Russian mining venture, in which ACP Special Situations No. 2 Limited held a significant stake.

This newspaper will be reporting more about the Russian mining venture in the coming days.

There would be a conflict if the company had a connection with Malta

The Appleby data forms part of a wider leak, collectively known as the Paradise Papers, which come from two offshore services firms based in Bermuda and Singapore, as well as 19 corporate registries.

The leaked data was obtained by German newspaper Süddeutsche Zeitung and shared with the International Consortium of Investigative Journalists and a network of more than 380 journalists in 67 countries, including the Times of Malta.

Prof. Bannister, who was appointed MFSA chairman in 1999 by then finance minister John Dalli, said his involvement with the Oberoi family predated his appointment.

Asked when he took up his role on the board of ACP Special Situations No. 2, he said it was “quite some time ago”.

He said his “past involvements” came with the blessing of successive prime ministers and his “position” had been cleared by European supervision authorities.

In his interview with Le Monde, Prof. Bannister said that it was “public information” that he was a non-executive director of a number of funds, which, he noted, was declared to the Finance Minister and the regulator.

Prof. Bannister said that he had been paid €500 yearly to cover expenses for his role on the ACP Special Situations board. This involved attending board meetings “one or twice” in Jersey and communicating via telephone, he told the French newspaper.

Prof. Bannister played down any potential conflict of interest in his roles as adviser to a BVI-based company and head of the financial services regulator.

“Where is the conflict? There would be a conflict if the company had a connection with Malta,” he said.

Research by this paper, based on data from the MFSA’s registry included in the Paradise Papers leak, indicates that Mr Oberoi is a director of a Malta-based company in which ACP Partners Limited is a shareholder.

Last August, this newspaper tried to better understand Prof. Bannister’s declaration of financial interests, but the Finance Ministry blocked a request under the Freedom of Information Act.

In rejecting the request, the ministry said the information about the MFSA chairman’s financial interests was given for the purposes of enabling the Prime Minister to determine whether the person was fit and proper to hold office. It also argued that publication of the information requested would run counter to the principles of data protection.

Questions have long been raised about Prof. Bannister’s involvement in activities outside his role as MFSA chairman.

In 2012, then Opposition MP Evarist Bartolo, now Education Minister, accused him of failing to declare a directorship in a Cayman Islands-based company, Kairos Fund.

He was reconfirmed as MFSA chairman in 2014, despite heavy criticism by Labour of his handling of the investigation into the La Valette multi-manager property fund, which lost over €50 million in investors’ savings.

German MEP Sven Giegold was also critical of Prof. Bannister’s directorships, saying that being both a supervisor and an industry player constituted a “serious conflict of interest”.

Shortly before the June 2017 general election, Prime Minister Joseph Muscat announced that Prof. Bannister would be stepping down by the end of the year.