Joe Bannister took up a non-executive directorship in a company based in the British Virgin Islands (BVI) in 2007, while he was already chairman of the Malta Financial Services Authority, The Sunday Times of Malta has learnt.

This runs contrary to a recent interview he gave to French paper Le Monde, when Prof Bannister gave the impression that this relationship with the company, based in a notorious tax haven, predated his appointment to the financial regulatory authority in 1999.

Photo: Darrin Zammit Lupi

Incorporation documents from the BVI obtained by this paper show that ACP Special Situations 2 was set up on March 7, 2007.

Prof. Bannister’s role in the BVI company was only made known thanks to the Paradise Papers.

Leaked documents from the offshore services firm Appleby cite Prof. Bannister as being part of “management” in ACP Special Situations 2.

Prof. Bannister says he severed ties with ACP Special Situation 2 last year.

ACP Special Situations 2 took up a shareholding in a Russian mining venture suspected of siphoning off public funds from the European Bank for Reconstruction and Development (EBRD).

The BVI-based company is an investment vehicle for the London-based firm ACPI, chaired by Alok Oberoi.

Prof. Bannister has said his relationship with the Oberoi family pre-dated his appointment as MFSA chairman in 1999.

Questioned why Mr Oberoi specifically chose him as a non-executive director, Prof. Bannister replied that he must have known his abilities when it came to governance and sitting on boards.

When it was pointed out during the interview with Le Monde that he was hired to sit on the board after his appointment as MFSA chairman, Prof. Bannister said this was not the case.

Prof. Bannister said he could not remember when ACP Special Situations 2 was incorporated, but explained that it formed part of a wider set-up.

When questioned recently, he played down any potential conflict of interest, saying there would be a conflict if the company had a connection with Malta.

The Finance Ministry has refused to give this paper a copy of Prof. Bannister’s declared financial interests.

A request made in terms of the Freedom of Information Act was turned down on grounds that “such information is not given for the purpose of publication to the general public”.

Prof. Bannister, whose contract expires in 2019, has expressed a desire to step down as MFSA chief due to “personal reasons”.

Prime Minister Joseph Muscat said in May that the process leading to his resignation was to begin towards the end of the year.

Prof. Bannister had his contract renewed by the Labour government in 2014.

He was a frequent target of criticism by Labour when it was still in Opposition.

PL MP Evarist Bartolo called for his resignation in 2012 over his directorships of investment funds based in the Cayman Islands.

Mr Bartolo reiterated his called for Prof. Bannister’s resignation last year, during the height of the Panama Papers scandal.

Le Monde interview transcript

Interviewer: But somebody asked you to be this non-executive director.

Bannister: Yes, Mr Oberoi.

Interviewer: How do you know Mr Oberoi?

Bannister: I have known him for a long time, I have known the family for a long, long time.

Interviewer: So he was the shareholder, and he needed a director to represent him on the board? And that’s why he came to you?

Bannister: That’s right, yes. Not to represent him, there were other directors on the board.

Interviewer: Why did he need you, specifically?

Bannister: I think he knew my competence when it came to sitting on boards and governance. So I sat on the board.

Interviewer: But you were hired after you were already head of the MFSA…

Bannister: No, no, no, no, before. I knew Oberoi much before.

Interviewer: Yes, but ACP Special Situations 2 was created after 1999.

Bannister: I could not remember when it was created. They form part of a whole set-up. So it must have been there before, somewhere, and then took this role.