All that glitters at Marigold...

The machine of the Marigold Foundation was still silently humming in the background when Prime Minister Joseph Muscat resigned in disgrace after the implication of his chief of staff Keith Schembri in the Caruana Galizia assassination in December 2019.

Muscat’s wife Michelle had by then presided over one of the most formidable fund-raising as well as generous charities of the past six years.

With a €200,000 capital endowment by the partly government-owned Bank of Valletta, Michelle Muscat’s role as spouse of the prime minister was invested as chair of the Marigold Foundation, a charity that became the prime vehicle of Muscat’s personage, but also a pioneer of less popular causes such as rare diseases.

Since then, Muscat’s charity events and her annual swimming challenge raised over €2.3 million: Marigold today has a surplus of €559,060, excluding BOV’s founding capital. For all intents and purposes a charity ‘owned’ by the bank, the foundation’s equity has always enjoyed a steady rise. In total, the charity now has over €776,000 in cash equivalents.

But the foundation has been generous in disbursements every year, with 48% to 70% of its revenues given out from 2014 to 2018, for a total of €1.38 million donated to its causes – that makes up 60% of historic donations.

Expenses rose steadily from €14,752 in its first year to €141,000 in 2018 – a total of €365,114 over five years, or 16% of total donations.

The annual report however makes no further breakdown of this figure, and the jump might be explained by larger campaigns, a scaling-up of the charity, and a move towards glitzier gala dinners and fashion shows. None of the events could escape the star power of Michelle Muscat herself, whose annual swimming challenge personalised the work of the Marigold Foundation in her own image.

Now Muscat has been installed as a co-founder of the Marigold Foundation through a nominal €100 endowment, which will give her the authority to appoint persons of her choice to the board of the Foundation.

Apart from assistants who have been by her side in the last years, Muscat appointed her husband’s long-time aide Mark Farrugia as a representative on the foundation’s board of administrators. Like Muscat herself, Farrugia had been by the side of former Labour leader Alfred Sant as the party’s media coordinator. Both have deep political knowledge of the Labour party structures; but Michelle Muscat has never shied away from the political game either.

Bank of Valletta has been cagey about the future of the Marigold Foundation with Muscat as its head. BOV did not confirm whether it had a run a risk assessment on the fact that the charity is run by a PEP.

Michelle Muscat’s husband is a former prime minister whose activities in government remain under the scrutiny of numerous audits, but also connected to the fates of people implicated in wrongdoing: his former chief of staff Keith Schembri is formally investigated on a passports kickback together with Nexia BT’s partner Brian Tonna, a one-time auditor of the Marigold Foundation itself; Muscat’s name has already been mentioned in the info-dump that are the Melvin Theuma recordings in the compilation of evidence against Yorgen Fenech.

For a bank that has been keen on de-risking itself and fending off the headaches of the Falcon Funds saga and the Deiulemar case in Italy, having one of Malta’s foremost PEPs in charge of a €1 million asset charity must require additional scrutiny.

Bank of Valletta has defended the retention of Muscat as a co-founder on the Marigold’s board.

“Michelle Muscat was in effect a co-founder of the Foundation since its inception in 2014. In 2019 this agreement was formalised though establishment of the formal legal set up of the Foundation,” a BOV spokesperson said.

“The Foundation’s governance structure ensures that there is the highest level of transparency in its activities.”

When pressed on her role as a PEP, the bank said that it was applying “enhanced levels of due diligence” to anyone falling under this category.

BOV said the Foundation’s accounts are fully audited by KPMG and comply with the legal requirements of the Commissioner for Voluntary Organisations, where they are subject to an annual statutory audit and submitted to the Commissioner for Voluntary Organisations.

None of the members of the board of administrators, including the co-founder, have ever received any remuneration for their role or services and the salary of the executive secretary – a BOV employee seconded to the Foundation – is borne by BOV itself.

“The Bank’s policy has always been to integrate social concerns both in our business operations and in the interaction we have with our various stakeholders, this with a view of making a positive contribution towards society in general. Bank of Valletta has been a pioneer in the sphere of Corporate Social Responsibility for a considerable number of years with annual contributions being made in the areas of art and culture, heritage, the environment, sports, education and the social sectors,” the spokesperson said.

In 2018, Michelle Muscat – whom her husband has in the past credited as a sounding board for his policies – had played down claims of political ambitions. After the exit of her husband from politics, Muscat refused to entertain questions on her political ambitions, saying she was focused on Marigold and the National Alliance for Rare Diseases Support.