‘Muscat’s attack on me, attack on financial services industry’ – MP

Nationalist MP Tonio Fenech is accusing Prime Minister Joseph Muscat of denting the financial services industry in a speech made on Sunday in which Muscat referred to MaltaToday’s ‘revolving doors’ report on the former finance minister.

Over the past three years, Fenech drifted into the world of private investment funds as declarations submitted by MPs this past month, show.

Fenech holds non-executive positions in companies, two of which are Malta-based subsidiaries to ownerships registered in the British Virgin Islands and Jersey. But Fenech denies that his services are directly offered to any offshore companies.

MORE Through the revolving door: Fenech’s drift into corporate world reveals connections with former BOV officials

On Sunday, Muscat set much store by Fenech’s company involvements to hit out at Opposition leader Simon Busuttil, who has built a political plank demanding honesty in politics after energy minister Konrad Mizzi and Muscat’s chief of staff Keith Schembri admitted opening offshore companies in Panama after the 2013 elections.

“Muscat has his back to the wall on Panama, so he is ready to throw away the financial services sector. Stop using my legitimate activity to defend the behaviour of others,” Fenech said.

Fenech declared his company involvements in his latest declarations, as he did in previous years since 2013 when he stepped down from finance minister. “None of the companies work from any jurisdiction which, when it comes to the Financial Intelligence Analysis Unit, is considered as a ‘non-cooperative jurisdiction,” Fenech said.

The full list of non-cooperative tax havens released by the European Commission listed the British Virgin Islands among some 30 territories. One of the companies Fenech is chariman of, Abalone Asset Management, is ultimately owned by a BVI company.

“I followed FIAU rules and made the necessary verifications about who the ultimate beneficiary owner is of companies registered in other countries. I can declare these are serious people who are not PEPs or involved in money laundering or illicit financing,” Fenech said, saying he had carried out proper due diligence and know-your-client vetting before taking up his directorship.

“I do not render any services to offshore companies. These are all MFSA-licensed companies, which pay their taxes in our country, who are here for our regulation, access to the EU market, and other services we offer. Malta’s financial services centre is on the OECD’s whitelist with a tax system accepted by the EU, a centre under threat because of the Prime Minister’s decisions.”

Fenech said that Muscat was incorrect in saying that he word for a company that offers trust services. Fenech is company secretary to Marlin Property, which is owned by First Names Group of Jersey, the company that offers trust services amongst others. “[Marlin] does not open trusts in other countries, which is anyway a service that Malta itself offers. If the prime minister finds anything wrong with that, then he is ready to throw away a sector the Maltese economy depends on and on which thousands of jobs depend.”

Fenech also said Muscat’s allegation that he set-up companies with former Bank of Valletta officials was untrue, referring to shared directorships he has in three separate companies with two former CEOs and a former chairman of the bank, which is partly government-owned.