Mr Cuschieri’s departure will also lead to musical chairs at the gaming authority

Joseph Cuschieri, an accountant who has been heading the Malta Gaming Authority since Labour was returned to power in 2013, has been selected by the Office of the Prime Minster to serve as the new CEO of the Malta Financial Services Authority, The Sunday Times of Malta is informed.

The MFSA law does not contemplate the post of a CEO so the government is amending it specifically to create the position, long earmarked for Mr Cuschieri.

Since its inception in the late 1980s, when Malta laid the seeds for its now burgeoning financial services industry, the MFSA has been led by Prof. Joe Bannister, except for a short stint during the 1996-1998 Labour government when he was replaced by Edward Scicluna, today’s Finance Minister. In 1998, following the premature collapse of Alfred Sant’s Labour administration, Prof Bannister was reinstated by then Finance Minister John Dalli, known to be a close friend of his.

Despite pressure from senior Labour quarters, including repeated public calls by Education Minister Evarist Bartolo for the removal of Prof Bannister, Prime Minster Joseph Muscat has kept him in office and defended him against accusations of conflicts of interest including those revealed by the Paradise Papers.

The MGA boss has been eyeing the position at the MFSA for a long time. However, it was only after Labour’s last victory at the polls that the OPM decided to give him the position, following more dissent over the possibility of Prof. Bannister being reconfirmed. According to an amendment in the MFSA law, which still needs to be approved by Parliament, the new CEO must be selected by the board of governors of the financial regulator, which is meant to be independent.

However, an OPM source said that the decision on Mr Cuschieri has already been taken by Castille.

An industry source said: “It is a joke in industry circles that the MFSA or its new non-executive chairman, Prof. John Mamo, will have any say in the selection of the new CEO. Everyone in the industry knows that Mr Cuschieri has already been chosen by the OPM.”

Mr Cuschieri’s departure from the MFSA, in a few weeks’ time, will also lead to musical chairs at the gaming authority.

The expectation is that Mr Cuschieri’s right hand man at the MGA, Heathcliff Farrugia, will step into his shoes while the current chairman of Mimcol, Adrian Said, will be appointed non-executive chairman.

Mr Farrugia, a former colleague of Mr Cuschieri at Vodafone, was recruited to the MGA by Mr Cuschieri without any call for applications.

Both Mr Cuschieri and Mr Said are considered as part of the inner circle of the Prime Minister’s chief of staff, Keith Schembri.

At the MGA, Mr Cuschieri was one of the highest paid political appointees on the island, given a remuneration package of over €120,000 a year.

Industry sources say he is now gunning for an even better package in his new post.

During his tenure, the MGA saw its operating costs more than triple, reaching €10 million in 2016, while the industry continued to flourish.

Relocating its premises to Smart City, the MGA paid €4.3 million to fit-out a building leased for 15 years from the Dubai-based company. Mr Schembri sits on the board of Smart City.