The financial services watchdog has clarified that a court-appointed administrator of a Maltese investment firm which went bust last year was not empowered to settle any pending claims with creditors.
Such transactions may only be done if the company is dissolved, through a liquidator, it said.
The case involves Maltese Cross Financial Services, whose operations were suspended by the Malta Financial Services Authority in August of last year following claims of misuse and manipulation of funds.
A total of 222 clients were affected and the shortfall in funds was of €6,475,000.
Last March the company directors filed an application for liquidation but the court last month upheld an MFSA request to appoint a provisional administrator pending its decision on the winding up request.