The La Valette Multi Manager Property Fund
MAY 31, 2011

The recent communications in the media, on the basis of statements made by Finco Treasury Management Limited during a recent press conference, indicate a clear misunderstanding of the Authority’s function and of its powers as stipulated in local legislation. A clarification is called for in this regard.

The MFSA’s role with regards to the compliance issues relating to the La Valette Multi Manager Property Fund (‘the Fund’), which have been brought to the attention of the Authority, is that of investigating the alleged wrongdoing by Valletta Fund Management Limited (‘VFM’) and Bank of Valletta plc (‘BOV’) in the general conduct of business of the Fund. The MFSA is also reviewing a number of complaints filed by or on behalf of individual investors relating to the sale of units in the Fund by BOV.

In order to fulfil its duties in the best interest of investors and Malta’s financial market, the MFSA is duty bound to carry out its investigations diligently and with prudence. The results of these investigations should ensure a just and fair decision, which reflects the gravity of the Authority’s findings and conclusions, after having weighed the representations submitted by the parties concerned.

Undue pressure through the media to hasten or pre-empt the investigative process, which requires meticulous and thorough analysis, is not helpful, and may confuse investors. While the MFSA appreciates the public’s demands for a clear position from the Authority on this matter, the MFSA will only be in a position to issue a statement on its findings and conclusions once the investigation has been completed. Hasty and incomplete public statements on regulated entities, especially where these are publicly listed and traded companies, could damage the integrity of Malta’s financial market to the detriment of investors.

The MFSA is not authorised at law to make a public statement on its on going investigations before a fair and exhaustive regulatory process has been undertaken and brought to a proper conclusion with clear and specific findings. The current position is that final representations from VFM and BOV are expected by the 6th of June, following which a final decision will be arrived at by the Authority.

In the meantime, the Authority also expresses its hope that media reports on these ongoing matters will be presented in a more balanced and dignified manner.