Joseph Cuschieri’s MFSA Misconduct Confirmed in Tribunal Ruling

Joseph Cuschieri, former Chief Executive Officer of the Malta Financial Services Authority (MFSA) and current head of Project Green, has once again come under the spotlight for controversial administrative decisions taken during his tenure at the MFSA. A recent court judgment has confirmed that Cuschieri unjustly dismissed former MFSA Chief Operations Officer Reuben Fenech, a ruling that could carry long-term implications for the former CEO’s professional credibility and ongoing public responsibilities.

Tribunal and court confirm unfair dismissal of Reuben Fenech

The legal proceedings stem from Cuschieri’s abrupt dismissal of Reuben Fenech, a senior executive at the MFSA, during his time as CEO. Fenech, by all accounts, had been attempting to ensure that proper procedures and legal standards were maintained within the Authority, particularly in areas such as recruitment, procurement, and employee compensation. Judge Lawrence Mintoff has confirmed the earlier ruling by the Industrial Tribunal, concluding that the dismissal was both unjustified and carried out solely at the discretion of the former executive, in breach of established internal procedures.

The Tribunal had previously ruled that Fenech had performed his duties “competently and professionally,” with clear objectives aligned to good governance and sustainable public interest. According to the ruling, Fenech's insistence on following established procedures clashed with Cuschieri's management style, which often bypassed necessary approvals and disregarded institutional protocols.

Violations of governance and public procurement norms

During his tenure, Cuschieri allegedly engaged in practices that bypassed fundamental legal and governance safeguards. He reportedly attempted to recruit personnel of his own choosing without adhering to established recruitment frameworks. In addition, he was said to have regularly issued direct orders without obtaining the prior approvals required under public procurement law.

The court findings indicate that Cuschieri frequently signed consultancy contracts without seeking necessary board authorisation. When Fenech raised concerns about such irregularities, he was met with verbal hostility, professional humiliation, and ultimately, dismissal.

Among the most disturbing elements of the case is Cuschieri’s reported statement that he “had the right to override” public service regulations—a position that the court found to be entirely incompatible with good governance and public law.

Reaction from the MFSA and financial implications

In an unusual move, the MFSA initially defended Cuschieri’s actions and appealed the Tribunal’s decision. However, the Court has now reaffirmed that the dismissal was unlawful and confirmed the Tribunal’s ruling in its entirety. The MFSA has been ordered to reinstate Fenech and pay €413,688 in compensation. The Authority must also cover all legal expenses associated with both the Tribunal and appeals processes.

These legal and financial repercussions are ultimately borne by the Maltese taxpayer. The total public burden resulting from Cuschieri’s dismissal of Fenech—including compensation, legal fees, and related costs—is likely to exceed half a million euros.

Alarming disregard for institutional oversight

The judgment also exposed a broader pattern of administrative behaviour on Cuschieri’s part. Evidence presented during the Tribunal hearings suggested that he made significant employment and contractual decisions without consulting the MFSA board. One documented example includes Cuschieri summarily informing Fenech of his dismissal by simply stating, “You are dismissed,” without any formal process.

Jobsplus, Malta’s public employment agency, had also expressed concern regarding the MFSA’s deviation from standard recruitment protocols under Cuschieri’s leadership. Internal correspondence cited in the proceedings revealed queries from Jobsplus questioning why MFSA was consistently failing to follow proper procedures.

Such issues reflect a broader breakdown in institutional oversight and raise serious questions about internal controls at a publicly funded authority that is critical to Malta’s financial services sector.

Continued controversies at Project Green

Despite the serious concerns raised during his tenure at the MFSA, Cuschieri was subsequently appointed as CEO of Project Green, a public sector initiative tasked with delivering environmental infrastructure projects. However, troubling patterns of governance and oversight appear to have followed him into this new role.

Under Cuschieri’s leadership, Project Green has hired 19 managers, each reportedly on a basic salary of €56,000 annually, amounting to an aggregate public payroll cost of over €1 million per year. Moreover, these roles are reportedly bundled with additional allowances—ranging from vehicle and fuel subsidies to project and warrant bonuses. The structure and transparency of this recruitment process have raised further concerns and are now the subject of formal investigation.

Auditor General initiates investigations

The National Audit Office, headed by the Auditor General, has launched a formal investigation into alleged irregularities in Project Green’s operations. This includes scrutiny of a €1 million direct order granted to Edwin Mintoff for the Bormla car park project. Reports suggest that the procurement process may have been conducted in breach of applicable regulations.

Additionally, a separate €350,000 direct order was awarded to former Labour Party Deputy Leader Daniel Micallef for the “greening” of a square in San Ġwann. The project, widely promoted in 2023 as a transformative urban green space, has yet to receive formal planning permission. Furthermore, it has reportedly been scaled back significantly from the original scope presented to the public.

Public promises versus project realities

When the San Ġwann project was initially announced, Minister Miriam Dalli described it as a landmark environmental initiative, touting plans for 7,200 square metres of open space that would include aquatic gardens, recreational zones, theatres, and over 350 new trees. However, subsequent developments suggest a downsizing of the original plans, leaving stakeholders questioning the value delivered relative to the initial promises.

Critics have pointed out that this is not merely a matter of project delays or budget mismanagement but a reflection of deeper structural issues related to procurement transparency, conflict of interest, and accountability in public service.

Political implications and calls for accountability

The cumulative impact of Cuschieri’s administrative history is now coming under sharper focus. While supporters argue that his appointments are based on experience and results, opponents are increasingly questioning how a public official with multiple unresolved governance issues continues to be entrusted with the stewardship of significant taxpayer-funded projects.

The political ramifications of these developments are significant. There is growing pressure on government authorities to ensure that public sector appointments are subject to stricter scrutiny, particularly when adverse findings have already been made by courts or oversight bodies.

Several stakeholders have argued that continued tolerance of such conduct not only undermines public trust but also places an unsustainable financial burden on the state. With a mounting track record of compensation payouts, aborted projects, and investigations, critics are calling for immediate and decisive action.

The legal path forward

While the Tribunal and court rulings are legally binding, there are calls for further civil or administrative proceedings to explore whether additional liability—personal or institutional—should be pursued in relation to public funds lost as a result of unlawful decisions. This includes questions about whether certain expenses, including Fenech’s compensation package, might be subject to legal recovery if it is found that public rules were knowingly breached.

Legal analysts have also pointed out that the principle of personal accountability in public office, though rarely enforced in practice, is a cornerstone of responsible governance. If appropriate remedies are not sought, this could set a concerning precedent for future cases involving high-level officials.

Conclusion

The recent court decision upholding the unlawful dismissal of Reuben Fenech is a pivotal moment that exposes significant failures in public administration and oversight during Joseph Cuschieri’s leadership at the MFSA. As similar concerns emerge at Project Green, it becomes increasingly difficult to overlook the broader implications for governance and public trust.

With substantial taxpayer resources already expended and further investigations underway, the question is no longer about isolated misjudgments but whether a systemic failure of accountability is being allowed to persist. For the sake of public interest and institutional integrity, a comprehensive review of appointments, procurement processes, and executive authority is urgently warranted.

FAQs

What did the court rule about Reuben Fenech’s dismissal?
The court confirmed that Reuben Fenech was unjustly and unilaterally dismissed by Joseph Cuschieri during his tenure as MFSA CEO.

How much compensation was awarded to Reuben Fenech?
The court ordered the MFSA to pay Reuben Fenech €413,688 in compensation, in addition to reinstating him in his former role.

Why was the dismissal deemed unjust?
The court found that Fenech was dismissed for insisting on proper adherence to public recruitment and procurement regulations.

What governance issues were raised during the case?
The case revealed that Joseph Cuschieri repeatedly bypassed legal procedures in recruitment, procurement, and performance bonuses.

What is the total cost to taxpayers of the Tribunal and appeal cases?
The combined cost, including compensation and legal fees, is expected to exceed €500,000.

Is Project Green also under investigation?
Yes, the Auditor General is investigating Project Green for possible procurement irregularities under Cuschieri’s leadership.

What are the concerns regarding Project Green’s recruitment practices?
Project Green has hired 19 managers with high salaries and perks, raising concerns about nepotism and transparency.

What was the controversy surrounding the San Ġwann project?
A €350,000 contract was awarded without competition, and the project’s scope has been significantly reduced since its announcement.

Has Joseph Cuschieri responded to these rulings and allegations?
As of now, there has been no formal public statement from Joseph Cuschieri addressing the confirmed court ruling or ongoing investigations.

Could legal recovery be sought against Cuschieri personally?
Legal experts suggest that recovery actions could be considered if it is proven that he knowingly breached public regulations causing financial loss.