Read: Findings from the published FIAU report

David Casa published the FIAU report detailing what “Joseph Muscat has been trying to keep secret for the past year.”

The FIAU report in its conclusion stated that with the information there was available, it deemed sufficient to conclude that a reasonable suspicion of money laundering and / or existence of proceeds of crime subsists. The report concludes that it will be passed on to the Police as per law. The report details the analysis carried out by FIAU in relation to Konrad Mizzi and his ownership of an offshore trust and company while he was an Energy Minister.

One of the contradictions highlighted in the report was that contrary to what Konrad Mizzi had publicly claimed on February 26 2016, Rotorua is a Revocable Discretionary Trust and not a Family Trust. The difference between the two, as explained in the same report, was that a Revocable Discretionary Trust allows for more flexibility whereby  provisions can be altered or cancelled dependent on the grantor, Konrad Mizzi.

Read the full report here: FIAU Report

Findings from the FIAU report

  • The email between Mr Karl Cini and Mr Luis Quiel in March 2013, in relation to details relating to a Panama company and possibly a trust. This information in this email is not in line with claims made during 2016/2017, that the companies which were sold at a later date. Given the costs associated with the setup and maintenance or a trust, it would make no financial sense to the company service provider (in this case Nexia BT et al) to place a non-operative, shelf company in a trust for an indefinite period of time.
  • The fact that, of the 2 BVI shelf companies purchased in June 2013, only one was retained for the benefit of Mr Brian Tonna which raises suspicion that WILLERBY TRADE INC. was the company for which the Panamanian bank account was intended. The report states that this raises suspicion that WILLERBY TRADE INC. was being used as a test prior to setting up the Panamanian companies and respective bank accounts for Dr Konrad Mizzi and Mr Keith Schembri amongst possible others. This suspicion is substantiated further by the fact that email communication with references to HEARNVILLE INC., amongst others, commenced in July 2013.
  • A bank account at Pilatus Bank was used for both WILLERBY TRADE INC. and TORBRDIGE SERVICES INC. instead of pursuing the opening of a bank account in Panama.
  • Cini asked for 3 companies to be reserved for a number of days and subsequently also asked for an extension on this reservation. According to the report this indicates that Cini most likely needed time to communicate with the actual beneficial owners of the companies.
  • The question arises why there was a need for such secrecy given that under Maltese legislation, PEPs are openly allowed shareholdings.
  • Attempts made by Nexia BT to conceal from the FIAU that the companies belonged to Mizzi and Schembri was documented in the following emails:
    • Mr Karl Cini and Mr Luis Quiel dated 21st March 2013
    • Mr Karl Cini and Ms Cristina Rios dated 25th March 2013
    • Mr Kark Cini and Mossack Fonseca dated 28th July 2014
    • Mr Karl Cini and unidentified 3rd party dated 8th August 2014
    • Mr Daniel Leon and Mr Karl Cini dated 23rd October 2014
    • Mr Karl Cini and Mossack Fonseca (NZ) dated 16th May 2015
    • Mr Karl Cini and Mossack Fonseca (NZ) dated 23rd May 2015
    • Mr Karl Cini and Mossack Fonseca (NZ) dated 16th May 2015
    • Mr Daniel Leon and Mr Karl Cini dated 7th July 2015
    • Mr Karl Cini and Mossack Fonseca (NZ) dated 17th October 2015
  • The  claim that “All instruction and discussions with the Clients were verbal” is deemed to be suspicious given that when providing such a service, both the client and the provider are likely to resort to emails at least for parts of the process.
  • Karl Cini withheld information from the FIAU which shows his clients’ reluctance to inform domestic banks of their foreign structures and as a result were unable to 2 bank reference letters as requested by Mossack Fonesca & Co. (New Zealand).
  • Karl Cini informed Mossack Fonesca & Co. (NZ) that “it is not common to have more than one bank”. Mizzi is a long standing customer of 2 banks in Malta, HSBC and BOV.
  • Nexia BT et al. were only paid in June 2016 for the service provided. The sum paid was €4345.44
  • The payment of €493.72 from Konrad Mizzi to BTI Management on August 23, 2016.
  • The FIAU found that contact was made with the following banks, each with a request whether they would accept a high risk client.
    • Bank in Dubai (exact bank unknown)
    • Bank of St Lucia International (BOSIL)
    • Winterbotham Bank (Bahamas)
    • Banco Itauv(Miami)
    • BSI Bank (Panama)
    • Brichell Bank (Miami)
    • Cidel Financial Group
    • FPB Bank (Panama)
  • The fact that in an email dated 15th December 2015 (Appendix 8.7) Mr Cini
    provided various details in relation to the operation of the Panamanian
    companies. In this communication Mr Cini stated that the companies are
    estimated to generate $2million within a year and that the monthly amount of
    transaction was expected at circa EUR150,000.
  • In relation to the various inconsistencies/suspicions circumstances noted in the case of Dr. Konrad Mizzi:
    • The inconsistency in the intended operations of the Panamanian Company
      HEARNVILLE INC. communications show the said activity to the range from
      preservation of family assets, management of inheritance, management consultancy
      and brokerage as well as being used as a holding company for operations conducted
      in sectors of Recycling and Remote Gaming.
    • Upon his return from Montenegro (ie. 16th June 2015) Dr. Mizzi signed the Source of Funds/Wealth Declaration Form. This declaration form identified Dr. Mizzi’s source of funds/wealth as being personal assets and proceeds from business trade.
    • The time in which the UK Company GASOL, sold its interests in Electrogas Malta Ltd.
      (22/07/2015) coincides with the time when HEARNVILLE INC. was placed under trust
      and steps were being taken to open an offshore account/s for HEARNVILLE INC.
    • Dr. Mizzi’s presence in Serbia in October, 2015 five days prior to the date an
      agreement was signed between the state of Montenegro State Consortium Fersa and
      Celebic, Mozura Wind Park d.o.o and Enemalta plc.
    • Dr. Mizzi’s presence in Montenegro in November 2015, which is just two days after an
      agreement was signed between the government of Montenegro and Enemalta plc. in
      relation to a 1.5 million Euro bank guarantee. Of further suspicion is the fact that the
      only transactions which appear to have been carried out using bank cards during this
      trip are on Dr. Mizzi’s personal credit card and are only for 0.01 euros which means
      that these were carried out in order to ensure that the card is valid. This therefore
      raises the question as to why Dr. Mizzi refrained from using his official card during this trip.
    • Dr Konrad Mizzi’s visit to Shanghai 2 days after the incorporation of SEP (Malta) Holding Limited in Malta, a company whose sole shareholder is Shanghai Electric Power and Energy Power and Energy Development Limited.
    • On the basis of information obtained through Dr Konrad Mizzi’s credit card activity, Dr
      Mizzi travelled to China 17 times during the period 10/09/2013 to 24/03/2016. It was noted that despite having family in China he stayed in hotels for at least 16 of these trips. This fact combined with the use of his official card indicates that these trips to China were State related visits. It was also noted that no transactions were noted on Mr Mizzi’s accounts in relation to the purchase of flight tickets. The volume of trips to China at a time when Malta and China were already signing deals in relation to Enemalta raises suspicion.