The Malta Independent 23 January 2020, Thursday

Investment services sector source of bulk of complaints to Arbiter for Financial Services

Albert Galea Monday, 1 July 2019, 14:20 Last update: about 8 months ago

The investment services sector was the source of the majority of complaints filed by people with the Arbiter for Financial Services in 2018, with 70% of all the complaints that the received being from this sector.

The Annual Report reveals that a total of 192 cases were received by the office in 2018, Arbiter Reno Borg explained.  The majority – 70% - of those were related to investment services, a further 20% related to the banking sector and the rest related to insurance and private pension cases.


54% of the complaints originated from persons residing outside Malta and who acquired the services from a financial services provider mainly on a cross-border basis.  The remaining 46% of complaints originated from customers residing in Malta.

Not all of these complaints require review and adjudication; 33 were resolved at mediation stage or after parties agreed to settle prior to mediation, while a further 13 cases were solved after parties agreed to on a compromise suggested during the first oral hearing.

The Arbiter issued 125 final decisions as well as a further 14 preliminary and follow-up decisions – such as clarifications or corrections).  100 cases were upheld in full, three were partially upheld and 22 were rejected.

The office received 1,016 enquires and minor cases throughout 2018 through emails, phone calls, and walk-ins, with the majority of them (424) being related to the banking sector, a significant increase from the 265 received in this sector in 2017 and the 13 received in 2016. A further 404 were related to the insurance sector, 137 related to the investments sector, and the remaining 51 looking at other subjects.

Out of those enquiries, 805 persons only required general information to their query.

Borg said that the office emphasised the need for professional and timely service.

The number of decisions delivered by the Arbiter increased from 64 in 2017 to 139 in 2018. The backlog that the office faced when it was founded in 2016 dated back to 2004, but all those cases have now been settled, while all the cases from 2017 save for around 10 have also been settled.  Some other cases introduced in 2018 have also been settled, Borg said.

Borg said that mediation is an important part of arbitration, and lamented that the Maltese are not used to the culture of mediation, as neither side would want to budge from their position out of fear of setting a precedent.  He noted that these fears were “unfounded” as decisions are published online in any case with all the details save for the complainant’s name, meaning that they are in the public domain.

He said that while there has been a small development in the number of cases solved by mediation, he augured that more and more complaints are solved through mediation as that would mean both sides would come to an agreement and both sides would be, up to a point, content with the outcome.

The Annual Report has already been tabled in Parliament, and is the third such report since the office was founded.

The office was established in 2016 and provides an alternate dispute resolution tribunal in line with European Union directives so that people can resolve complaints related to the financial services sector.

The arbiter’s jurisdiction is particularly wide, meaning that he can hear a number of different cases.  However, he can only hear a case if a complaint is filed.  However, the office, while being independent, works with the MFSA and the arbiter advises them if there is a service provider with a high number of cases against it or where there can be potential harm to a lot of people.


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