The revelations this week that the Malta Financial Services Authority’s CEO and General Counsel had travelled to Las Vegas with Yorgen Fenech in 2018 threatens to undo much of the good work carried out by the authority over the past couple of years.

There are no two ways about this, unfortunately, and the reputation and credibility of this important entity will suffer as a result of this previously undeclared and unheard-of lavish trip.

Cuschieri had barely been at the helm of the MFSA for a month when he accepted to be flown to Vegas by Fenech. For a start, this is allegedly in breach of the MFSA’s code of ethics, even though that particular document cannot be made public.

Worse still, he had just resigned as chief executive officer of the Malta Gaming Authority. Yet he was travelling with Fenech, a client of that particular authority who was interested in investing in a casino, to advise him on regulatory matters.

Furthermore, another person who was on the trip, Edwina Licari, was back then still employed by the Malta Gaming Authority as a legal advisor. Apart from raising questions about a conflict of interest by Licari, who was flown to Vegas to advise on a potential investment interest, it also raises the question as to why Cuschieri needed to be there too. The presence of Keith Schembri’s personal assistant, Charlene Bianco Farrugia, raises even more questions and doubts.

Now, after pressure to step down, both Cuschieri and Licari have “voluntarily self-suspended” and the MFSA’s board has initiated an investigation. Licari has also resigned her post as member of the board of the Financial Intelligence Analysis Unit – another entity which has unfortunately been thrown in bad light in this new scandal.

Many people are of the opinion that there was some form of conflict of interest, and that Cuschieri and Licari should step down.

The Prime Minister, however, does not share that sentiment.

A few hours before the self-suspension was announced, Robert Abela prematurely stated that there was no evident conflict of interest by Cuschieri. Instead, he hinted that this could have been some form of retribution or personal attack against the MFSA CEO.

Abela failed to mention that Cuschieri had already admitted to having gone to Las Vegas, and that his tickets had been paid for by Yorgen Fenech.

While, at the time, Fenech had neither been outed as the owner of 17 Black nor charged with being a mastermind in the murder of Daphne Caruana Galizia, the fact remains that the head of a regulatory authority had gone on a private trip with a private businessperson, to advise him on matters which no longer fell under his remit.

Worse still, it seems that Cuschieri, who had just taken up a highly paid role at the financial services authority, seemingly failed to declare the trip to the MFSA board.

The fact that the PM sees nothing wrong in all of this is bewildering. Does he think it’s ok for someone who was moving from head of the MGA to head of the MFSA to go on an all-expenses paid trip with a major player in the private sector?

Does the PM not realise that this latest revelation will do nothing but harm the reputation of the MFSA, which has worked so hard over the past two years to strengthen its credibility and step up the fight against money laundering?

Does he not realise that it will similarly hurt the FIAU which, after years of facing criticism has upped the ante and made great strides forward in strengthening regulations and resources?

Does the PM not fear that this will only make things harder for Malta as it faces a crucial Moneyval assessment?

Yes, the Prime Minister’s declaration was premature. He should have known better and should have waited until the MFSA probe is concluded before speaking. By stating that there was no evident conflict of interest, he could have prejudiced the MFSA investigation.

Similarly, Cuschieri and Licari are undoubtedly aware that there is no positive way out of this. Their actions, however innocent they may have been, have damaged the authority they serve.

It seems that both individuals are standing their ground and refusing to quit. But perhaps they should think long and hard about the consequences, on the reputation of the authority, if they choose to drag this out further.