Panama committee chairman challenges Malta government claims questioning legal mandate

The chairman of the European Parliament’s Panama Papers committee, Werner Langer, has told the Maltese government to put an end to money laundering and tax evasion, instead of questioning the mandate of the PANA committee and accusing it of political bias.

Langen said he was surprised to learn that government spokesman Kurt Farrugia had accused him of bias after the committee of inquiry into money laundering and tax avoidance demanded that Joseph Muscat’s chief of staff Keith Schembri – revealed in the Panama Papers of having opened a secret offshore company in Panama – to appear before the committee in Strasbourg.

“[Farrugia] accuses me of overstepping my institutional role and of joining a national party campaign. Apparently this is based on our Committee’s wish to hear Keith Schembri, the chief of staff of the Prime Minister of Malta, who allegedly acquired offshore firms via the infamous Panamanian law firm Mossack Fonseca,” Langen said, saying he was surprised to see such statements from the government holding the Council Presidency.

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“I believe it is in the interest of every citizen that Member States and European Institutions stand shoulder to shoulder to clamp down on money laundering and tax evasion and I fail to understand how such statements contribute to that,” he said.

Documents from the international Panama Papers leak reported by the Australian Financial Review in April 2016 showed that Schembri had sought the use of a Panama offshore company in 2015, to channel profits from his business venture into their offshore trusts in New Zealand.

Nexia BT, Schembri’s auditors, handled the contacts with Mossack Fonseca, the Panamanian law firm from which some 11.5 million documents pertaining to its offshore business were leaked by the International Consortium for Investigative Journalists.

Schembri had declined to appear before the PANA committee when it met in Malta in February, insisting that he was not an elected official and held a position of trust in service of the government, which he would continue to serve while he enjoyed “such confidence”.

Schembri published a copy of consolidated accounts of his trust, Haast Trust. The audit was carried out by independent audit firm Crowe Horwath, with offices in Canada, Cayman Islands, United States, India, France and the United Kingdom.

“It is amply evident from same audits that all the accusations that have been levelled against me have once again been proven baseless and ill-intentioned,” Schembri wrote in his letter to the committee.

Langen reiterated that it was the unanimous wish of the coordinators of all political groups on the committee to hear Schembri’s explanation – being a politically exposed person involved in the Panama Papers – about his offshore dealings with Mossack and Fonseca.

“I call on the Maltese government to engage with our Committee’s efforts to articulate recommendations that could put an end to money laundering and tax evasion, rather than questioning our mandate,” he said.

The Maltese government had as yet not responded officially to the committee’s request to meet Schembri, he said.