Another issue in Malta’s long list of regulatory compliance incidents came up. Malta is a popular place for gambling licenses issued and regulated by the Malta Gaming Authority (MGA). But like MFSA, MGA has serious issues with itself. It turned out that its Chief Officer Internal Audit James Grech was working on private business while in office, raising conflict of interest concerns, our sources say. He was providing LEAD Training Services in anti-money laundering, MLRO, internal auditing, and other gaming-related topics. Malta, for sure, has a big problem with its regulators and war grey-listed for good reasons!
Private training courses for MGA-regulated companies
James Grech (LinkedIn) and his LEAD Training Services (LinkedIn) provides training courses in anti-money laundering, MLRO, internal auditing, and other gaming-related topics. Thanks to his position, he is privy to sensitive information and has an edge on regulatory requirements. Hence, he is designing new courses to cover such. Thanks to the MGA’s extensive network, he is in touch with gaming HR managers and directors of MGA-licensed companies, who would eventually sponsor their employees for his training institute.
Lead Training Services is licensed by the Malta Further & Higher Education Authority. Its website does not mention any C Number or P Number as required by Education laws, and when invoicing, there is no VAT number. Students are asked to make payments to a Revolut bank account or other accounts in the name of J&A Grech, which appear as personal joint accounts of Grech and his wife, rather than those of a body corporate.
Before the 2017 election, Grech was an Internal Audit Contractor with MGA, billing at an hourly rate. Thanks to Grech’s close ties with Malta’s Environment Minister Aaron Farrugia, having been his part of his campaign for the 2017 election, he has been given the position of Chief Officer Internal Audit at MGA on a silver plate. James Grech was also a colleague of disgraced Joseph Cuschieri and Edwina Licari.
The MGA’s Code of Ethics and Professional Conduct (clause 7.9) stipulates that:
“Outside Employment and Termination- The prior approval of the Executive Chairman is required before we may engage in any form of business or employment outside our official duties. In all cases when outside employment is considered, we shall give our employment with the Authority first consideration and avoid situations which could give rise to, or the appearance of, a conflict of interest.”
The code of ethics continues (clause 7.11): “It is of the greatest importance that public confidence in the impartiality of the public administration shall not be impaired in any way. We need to ensure that participation in political activities does not bring us into conflict with our primary duty to serve the Authority.”
Real estate business and good friends
Grech’s ties with Minister Aaron Farrugia are also in breach of this clause. Radar Developments Ltd (OpenCorporates) is a property development company owned by James Grech and his brother. One of their recent developments in Marsaxlokk was originally marked for refusal, but 2 days later, the decision was revised. Thanks to Grech’s cozy friendship with Minister Farrugia, who happens to be responsible for the Planning Authority?
Radar Development‘s Facebook page (link) features various properties for sale, such as the originally refused development in Marsaxlokk, Tarxien, Attard, etc., brandishing James Grech’s personal mobile number. We wonder if whilst he is working at MGA, he also devotes himself to the property inquiries.
Whatever happens, it has become clear that there is a systemic issue with Malta Government officials being far too comfortable in blurring the lines between their official and public roles.
Malta has been grey-listed by the Financial Action Task Force (FATF) in the past weeks. Still any doubts why?