Issue link: https://maltatoday.uberflip.com/i/1050749
8 maltatoday | SUNDAY • 11 NOVEMBER 2018 NEWS Opera onal Programme I – European Structural and Investment Funds 2014-2020 "Fostering a compe ve and sustainable economy to meet our challenges" Project part-financed by the European Regional Development Fund Co-financing rate: 80% European Union; 20% Na onal Funds The Energy and Water Agency within the Ministry of Energy and Water Management in collaboration with Enemalta and Transport Malta is undertaking a project for the retrofitting of over 3,000 existing SON type street lights covering 79.6 km of arterial and distributor roads with more energy efficient LED type street lights together with the installation of a light management system. ERDF.PA4.0066 RETROFITTING ROAD AND STREET LIGHTING BY SMART LIGHTING The project's energy efficiency measures are aimed at reducing the carbon footprint produced by the generation of electricity for street lighting, as well as contributing towards the reduction of primary and end energy consumption. Greenhouse Gas Emissions shall also see an annual reduction in excess of 600 tonnes through the implementation of the project and a decrease of approximately 1,500 MWh annual primary energy consumption. This project is part-financed by the European Union under the European Regional Development Fund – European Structural and Investment Funds 2014-2020. MATTHEW VELLA THE Swedish pensions authori- ty has filed notice in court warn- ing a Malta-based entrepreneur from Norway that he will be held responsible for various losses Swedish pensioners incurred in the Falcon Funds bust. The pension fund was run from Malta for Swedish savers, and used the services of another company, Temple Asset Man- agement (TAM), to invest the money in the fund into blue- chip assets. The SPA however warned Norwegian Lars Christian Be- itnes it would hold him respon- sible for various losses incurred by Falcon Funds savers, over various investments made in particular assets he controlled. The SPA specifically referred to illiquid investments that TAM made in investments in which Beitnes had some form of control, namely Oxxy Group plc, Rock Energy AS, Element ASA, and the White November Fund. A report drawn up by auditors KPMG, appointed by the finan- cial regulator to take control of Falcon Funds, shows that mil- lions in Swedish savers' money were invested in financial in- struments to benefit particu- lar individuals – without any guaranteed return to the savers. Some €60 million was poured into obscure investments lay- ered under one company after the other, to benefit the mysteri- ous Swedish entrepreneur Emil Ingmanson – the man who first promoted Falcon Funds to the Swedish pensions authority. In its report, KPMG suspects that at Ingmanson's behest, TAM invested heavily in assets in which Ingmanson himself had an interest, at inflated val- ues, and specifically against the rules of the Falcon Funds pro- spectus. Throughout the course of their investigation, Beitnes had con- tacted KPMG of his own accord, to inform them of the €60.2 mil- lion investments carried out in companies he represents, by TAM director Anthony Farrell. "These assets do not look suited for a UCITS fund," KPMG said of the Beitnes assets that TAM invested money in. "Our initial indication is that we will not be able to sell these assets for more than 50% of their original price." Falcon Funds was a €247 mil- lion pension scheme marketed Swedes chasing pension money in Malta give notice to Norwegian director to Swedish savers, that invested the cash in blue-chip invest- ments. Although he was never its founder-shareholder, Emil Ingmanson had a formal role in setting up Falcon Funds, having attended 13 board meetings of Falcon Funds, whose directors were former finance minister Tonio Fenech, Ian Zammit and Joseph Xuereb. However, financial services rules require that all invest- ment decisions are vested in a firm independent of the fund's directors, which in this case was Temple Asset Mangement. After Falcon Funds was sus- pended from the Swedish pen- sions platform and taken under control, KPMG found "a clear connection" between Ingman- son and the Swedish energy company Werel AB, which it said was formerly known as Konsument EL Sverige – a com- pany once entirely owned by In- gmanson. "We discovered in an informal discussion with Vallet- ta Fund Services, that Ingman- son was very much involved in the fund's operation, and that he effectively took decisions related to investments, which should have been TAM's responsi- bility," KPMG director Sarah Camilleri wrote in her report. Specifically, the money was in- vested in ETIs (exchange traded instruments) marketed by an- other Malta firm, Argentarius, which is run by Austrian nation- al Andreas Woelfl. ETIs are used to create a chain of companies where the money invested in the first, 'runs down' to the ultimate beneficiary. "It looks like these ETIs were de- signed in such a way so as to make the initial investment ap- pear liquid enough to merit the pension fund's interest, despite the fact that ultimately the ben- eficial company at the bottom of the chain is illiquid," KPMG said. KPMG suspects that these ETIs were charging an inflated premium for the Werel shares. "TAM would invest some €20 million in two ETIs… for shares whose net asset value was €2.6 million. But the significant in- vestment does not reflect the value of the Werel shares, so we cannot explain this high pre- mium… We cannot understand TAM's reasoning for investing such significant amounts in this company." The MFSA has fined TAM a total of €612,000 for breaches 23 different standard licence conditions and had its licence suspended. TAM and Emil In- gmanson – who has since been arrested in Sweden – are also being sued by Falcon Funds. Falcon directors Tonio Fenech, Ian Zammit and Joseph Xuereb were given an official reprimand for failing investors, and pro- hibited from accepting any new appointments which require MFSA approval for two years. Lars Christian Beitnes