MPs’ tax returns: Tonio Fenech’s directorships earn him €112,000

The former finance minister, Tonio Fenech, left government in March 2013 to return to private sector work, doubling his income with numerous directorships he accepted as part of his professional work as auditor.

Fenech – who left PricewaterhouseCoopers in 2004 to take up the job of parliamentary secretary for finance under Lawrence Gonzi – declared a total income of €115,641 in 2013.

His income in 2014 exceeded €160,000 thanks to directorships in more than 11 different companies he represents, as tax returns requested by this newspaper from the Speaker of the House of Representatives show.

Last week Fenech told MaltaToday that until any rules are introduced for ministers to be granted suitable allowances not to take up employment in the fields they regulated, MPs remained free to pursue their professions as they saw fit.

The Maltese parliament however provides transitional allowances for former ministers after the lapse of 12 months from the termination of their executive position, and after deducting any income from their jobs.

But Malta has no fixed ‘revolving doors’ policies to limit the cases where lawmakers switch jobs and join the private sector, armed with the influence they gained as Cabinet members. Even CEOs and top directors in government regulators often find themselves drifting from their government posts into top private sector jobs in the same field they formerly regulated.

In 2013, Fenech earned €13,287 from his professional occupation as auditor and a total of €70,000 from his job as minister and later chairman of the public accounts committee. But he supplemented his income with directorships in Ferratum Bank, the MSF group of companies, Twinkleday Ltd – a company in which PN deputy leader Mario de Marco is also involved as director – Rocket Fuel Holdings, Legalzoom Enterprises, and Credorax: a total of €32,203 in honoraria.

In 2014, Fenech declared €20,000 in professional earnings, apart from his €27,298 honorarium as MP and PAC chairman.
His directorships earned him €112,750: Ferratum, Credorax, and Falcon Funds fees equalled €24,000, €30,000, and €15,000 respectively, while he added Vallgesa Ltd, Vallcara Ltd, Blue Point Ltd, and Philipp Asset Management Ltd, to his portfolio of companies.
Fenech has denied lending his services to offshore firms, given that he holds a non-executive directorship in an advisory firm whose registered owner is a British Virgin Islands company, and is a company secretary to a subsidiary of Jersey trust specialist.

In July 2015 he became chairman of Abalone Asset Management, a firm whose ownership is held in the British Virgin Islands. Back in 2013 Fenech became company secretary to Marlin Property Holdings, whose owners are the First Names Group, a leading provider of trust services located in another tax haven: Jersey.

As an MP it is Fenech’s right to have a separate profession. “I assure you that none of the companies I am involved in creates a conflict of interest with my parliamentary duties… None of the companies is in secretive non-cooperative jurisdictions barred by the FIAU. I carried out necessary know-your-clients checks to ensure these companies perform legitimate activities and have no politically exposed persons except myself and which is declared with regulatory authorities and financial institutions in Malta and abroad when required,” Fenech told MaltaToday last week.

Fenech also shares directorships with former state-appointed officials and top directors from Bank of Valletta, a partly government-owned bank. At Credorax he joined Tonio Depasquale, the former Bank of Valletta chief executive; he is a director with former BOV chairman – appointed by Fenech himself – Danny Publio Rosso, in the company Ananova Ltd; and again with Rosso and former BOV chief executive Charles Borg in Vallcara Limited, which is owned by Vallgesa Limited.