Fun fact: in October 1981, then gang boss Al Capone was convicted with several counts of tax evasion. Another fun fact: in February 2016, a minister managing two portfolios, energy and health, as well as the governing party’s Deputy Leader for Party Affairs, Konrad Mizzi, is revealed to have a trust fund in New Zealand which in turn owns a company in Panama. Panama is a well-known tax haven, and has also been blacklisted by the EU after failing to cooperate with tax investigations.
The government’s reaction? Abstention. The Prime Minister’s reaction? Trying to keep up with the different copies of the story which his Minister for Energy and Health as well as Second in Command was trying to fabricate.
As if this weren’t enough, not more than a few days later, the Prime Minister’s Chief of Staff, Keith "tal-Kasco’ Schembri, is revealed to have the exact same type of trust fund, and company in Panama; also holding a separate one in the British Virgin Islands, yet another state with dubious tax policies. Before I delve further into this piece, I would like to make it clear and declare that none of the following information is an accusation towards any party mentioned; it is merely factually-based questions to and about the current administration, the integrity of which has been dubious and failing at best.
Simply put, a trust fund is an agreement between two parties in which the grantor gives assets to the trustee for safekeeping. The beneficiaries, in this case being Sai Mizzi Liang (his wife and ex-consul-general to China) and their children would then be able to take the money after a predetermined period of time. This is usually set up by multi-millionaires who want to leave money to their heirs without letting them lose a fortune on inheritance tax.
What baffles me is how a family which is living off two government salaries has that much money to spare. Roughly speaking, Minister Mizzi’s only source of legal income is his salary which amounts to roughly €76,000. His wife, Mrs Mizzi Liang gets roughly €156,000 a year with her €13,000 a month salary. In total, the family’s income is circa €232,000 a year. Now, the ridiculously farcical appointment of Sai Mizzi Liang is beside the point, as well as her going AWOL throughout most of these five years and later telling the Maltese people that we should be grateful for her hard labour. With this sort of legal income, there would barely be any assets with a substantial value to appropriate towards the trust fund. Which leads to the question: is the Panama company being used to hide unknown assets?
Many skeptics have pointed out that the Panama companies’ date of incorporation and the mysterious Azerbaijan fuel deal, as well as the privatisation of Maltese hospitals coincide. This may lead to questioning whether there was a connection between them. Now, what I find most disturbing is not the fact that they hold such companies, or that Konrad is having important positions thrown at him; but the way they are handling this situation. When asked for comments on separate occasions, the versions of both the Prime Minister’s and the Minister’s story varied. They even said that they were not aware of the company name until the 1st of March, a good few days after the initial discovery.
When pressed for a comment, the Prime Minister Joseph Muscat threatened a young journalist with libel as well as telling him: “You will look stupid once everything is revealed.” Yet another concern is that if the Commissioner of Revenue, who the Minister openly invited to investigate him, got suspicious; he would not be able to do anything about it. This is because Panama refuses to give any information regarding companies incorporated in the state. Another interesting question to ask is: when Malta is a strong financial hub, as boasted about by the Prime Minister himself, why did his second in command doubt Malta’s financial services and instead trust his assets elsewhere? To top it all off, both Konrad Mizzi and Keith Schembri used the services of Mossack Fonseca to set up their companies; a firm which has been accused of helping money-launderers, oligarchs, and dictators on several occasions.
A recent revelation showed that Minister Mizzi has decided to close the company. But if everything was in order and legal, why would he need to? After three years of political nonsense, flamboyant farces and outright bureaucracy, this was the cherry on top of the cake. I personally take pleasure in observing Maltese people starting to doubt the transparency of this government, something which it promised to hold dear. The Prime Minister had even promised to remove Ministers from their roles if they were found to have Swiss bank accounts, but I’m assuming that trust funds in New Zealand and companies in Panama are fine. The people are finally questioning the meritocracy, or astounding lack thereof of this government; and I encourage them to keep on doing so. The people deserve an explanation for the many failings of this government. It is time for the people to have the transparency they deserve and rid themselves of corruption, a protest against which is being held on Sunday in Valletta. Has the People’s Party lost its credibility, so much so that the People must protest against it and fight for their own rights?
