Issue link: https://maltatoday.uberflip.com/i/665749
6 MATTHEW VELLA THREE businessmen – one of which is Joseph Muscat's chief aide Keith Schembri – have converged in the unfolding saga on Panama off- shore companies around the multi- million printing press built for Pro- gress Press. The €30 million state-of-the-art premises in Mriehel is owned by the Allied group of companies, which includes Allied Newspapers, the publishers of the Times. The newspaper has already lost managing director Adrian Hill- man, the former managing direc- tor who resigned his post when the Allied directors launched a board of inquiry to investigate allegations of bribery: made by Malta Inde- pendent columnist Daphne Caru- ana Galizia against him and Keith Schembri, the prime minister's right-hand man who before 2013 provided newsprint to Progress Press from his company Kasco. The allegations, made before the international leak of over 11.5 mil- lion documents form Panamanian law firm Mossack Fonseca, were denied both by Schembri and Hill- man. So far little has seen the light of day by way of evidence of bribery but Allied launched its own inquiry, headed by retired judge Giovanni Bonello, to investigate allegations that Hillman received some com- mission from Schembri. Hillman has yet to be summoned to the in- quiry. Since then, it has emerged that both Schembri and Hillman set up offshore companies in the British Virgin Islands, respectively in Janu- ary and May 2011, both handled by the same middleman: the Califor- nian Michael del Vecchio, who has an office both in Spain and in Mal- ta, and whose job was to provide cli- ents to Mossack Fonseca. In January 2011, Del Vecchio set up a British Virgin Islands company for Schembri called Colson Services Ltd, as well as the offshore company Selson Holding Corporation for Malcolm Scerri, who runs Schem- bri's Kasco group. Then in May, Allied Newspapers' managing director Adrian Hillman also got a BVI company through Del Vecchio, Lestor Holdings Group Ltd. Progress Press, whose Global Web Systems G-145 Printline was provided by the Kasco group after winning a tender, was finally inau- gurated in July 2011 by then prime minister Lawrence Gonzi. €900,000 for 'negotiations with suppliers' A third businessman, Pierre Slad- den, is the owner of Redmap Con- struction, whose firm was involved in the redevelopment of the derelict factory acquired by the Allied group back in June 2009 to house the new printing press. Even he has been identified in the Panama Papers re- leases by the Australian press. The adjudicating committee at Allied, headed by architect Paul Camilleri, chose the construction company Blokrete for the site's re- development, which in turn con- tracted Redmap Construction. At the time, Hillman had said that the potential of seven sites had been ex- amined before the contract for the land at Mriehel was signed. Sladden's name has cropped up in a concatenation of emails to Mos- sack Fonseca at the time when the audit firm Nexia BT started attract- ing the Panamanian law firm's at- tention, in late 2013. He also happens to have been in business with Schembri through film servicing company Cinebiss. Documentation among the Pana- ma Papers, which the Miami Her- ald reported on, shows that Del Vecchio wrote to Mossack Fonseca in Panama about his competitors, complaining that they were taking his clients. "Nexia BT is Pouching (sic) com- panies and clients away from Bald Eagle Services S.A. — one of your most loyal Professional Clients in order to easily build their clientele," Del Vecchio wrote in an email on 20 April, 2013. "I have copied our Legal Council (sic) in Malta." Soon after in May 2013, Mossack Fonseca (Malta) Ltd was registered with the Malta Financial Services Authority, with all of its shares held in fiduciary trust by BT Interna- tional Ltd. It set up in offices on the same office-building floor as those of Nexia BT. It was in this same year, in No- vember, that Nexia BT's partner Karl Cini had set up a British Virgin Islands company called Blue Sky Portfolio for Sladden. Documents seen by the Austral- ian Financial Review show that in November 2013, Pierre Sladden's company Redmap Constructions had a €900,000 debt constituted for a Cyprus company called A2Z Consulta – itself a company whose nominee directors appear as the firm Best Servus, of Cyprus. The money was for A2Z Consulta to pay for the "provision of services consisting in quality checks and negotiation with suppliers", which it sub-contracted to Blue Sea Port- folio – whose 50,000 shares Sladden himself owns. But in comments to The Times, Sladden has denied the impression given by the Australian Financial Review. "Redmap does not owe and has not paid or otherwise transferred any funds to A2Z Consulta. My company PS & Sons is 50% of Cas- tille Investments, which acquired Canberra House" – a building once owned by Allied Newspapers on St Paul's Street, whose expropriation in 1989 was fought against in court by Mario de Marco, the now Na- tionalist deputy leader, also a mem- ber of the Strickland Foundation, which owns Allied Newspapers. It was a way of Sladden reminding The Times how deep his business association with the newspaper was. The political heat from Panama Papers has clearly raised the tem- perature for Joseph Muscat: Keith Schembri created an offshore com- pany in Panama at the same time as energy minister Kevin Mizzi, in 2015, again through Nexia BT and Mossack Fonseca. Both off- shore companies, Hearnville (for Mizzi) and Tillgate (for Schembri), are owned by the trustees running both official's New Zealand trusts, Rotoura and Haast. Calls for the resignation of both Schembri and Mizzi have come from civil society activists, the Op- position, and even veteran Labour minister Evarist Bartolo and for- mer prime minister Alfred Sant. The Opposition has led two pro- tests against what it says is cor- ruption at the heart of the 'Pan- amagate' affair, and called for the investigation of all government contracts that Mizzi as minister has presided on. Nexia, Schembri denials Brian Tonna, the managing part- ner of Nexia BT, has insisted that two offshore companies acquired for Konrad Mizzi and Keith Schem- bri were only transferred to his two clients in July 2015, and denied that either the energy minister or the Prime Minister's chief of staff had any interest in the companies. The reaction comes in the wake of reports in the Australian Financial Review claiming that Nexia BT, an agent of Mossack Fonseca, had re- quested the Panamanian law firm to set up the offshore companies that were only later formally reg- istered in Mizzi's and Schembri's name, just days after the 2013 elec- tion. But Tonna disputes the claim that the two companies, Hearnville and Tillgate, were destined for Mizzi and Schembri. "As a service provider we had ac- quired the companies in order to be able to timely assist clients when and if requested. "It has been repeatedly confirmed that Tillgate and Hearnville were transferred to our clients Keith Schembri and Konrad Mizzi on 2 July 2015. Prior to said date the persons referred to had no interest, beneficial or otherwise, nor did they have any control over, the compa- nies," Tonna said. A third offshore company set up at Nexia BT's behest, called Egrant, is still a shelf company, Tonna said. "Any other insinuation is baseless in fact… We are not at liberty to divulge any client details since we are bound by professional secrecy obligations." Keith Schembri, has also "categor- ically denied" exercising any control on his offshore company in Panama before July 2015. Schembri said he acquired Tillgate Inc on 2 July solely for the purposes of its settlement into the New Zea- land Trust, Haast Trust, and was intended solely for estate planning. "Beyond this, I have no knowledge of any prior company activities save the fact that the company has never traded to date," he said. The OPM chief of staff said it was inconceivable that a newspaper would allow comments attempt- ing to link unmentioned "business figures" to the government without any substantiation or the faint at- tempt to corroborate it in fact. "The tone, scope and elaborate insinua- tions coupled with the deceit with which facts are treated are intended solely to tarnish my reputation and attribute to me intentions or actions which are not based on the truth," he said referring to coverage of the AFR's report on the Panama Papers. maltatoday, WEDNESDAY, 13 APRIL 2016 News MALTA'S PRESIDENCY OF THE COUNCIL OF THE EU 2017 CALL FOR TENDERS TRANSPORTATION SERVICES The Parliamentary Secretariat for EU Presidency 2017 and EU Funds, within the Ministry for European Affairs and Implementation of the Electoral Manifesto, notifies that a call for tenders for Transportation Services – Provision of Chauffeur Driven Cars, Executive Minivans & Coaches, and Self-Drive Cars held in relation to Malta's Presidency of the Council of the EU 2017 has been issued. The tender documents are available to download online from www.etenders.gov.mt MALTA'S PRESIDENCY OF THE COUNCIL OF THE EU 2017 CALL FOR TENDERS TRANSPORTATION SERVICES The Parliamentary Secretariat for EU Presidency 2017 and EU Funds, within the Ministry for European Affairs and Implementation of the Electoral Manifesto, notifies that a call for tenders for Transportation Services – Provision of Chauffeur Driven Cars, Executive Minivans & Coaches, and Self-Drive Cars held in relation to Malta's Presidency of the Council of the EU 2017 has been issued. The tender documents are available to download online from www.etenders.gov.mt BVI offshores find common thread with Progress Press relocation Businessmen, including PM's chief of staff, revealed to have set up BVI offshore firms all connected in €30 million development of Progress Press premises in Mriehel June 2009: Acquisition of Mriehel factory for new Progress Press premises January 2011: Keith Schembri and Malcolm Scerri set up offshore firms in the BVI May 2011: Allied Newspapers managing director Adrian Hillman sets up BVI firm July 2011: Progress Press inaugurated May 2013: Mossack Fonseca sets up Malta office through Nexia BT November 2013: BVI firms set up for Pierre Sladden, of Redmap, for alleged US$1 million transfer July 2015: Offshore firms set up in Panama by Mossack Fonseca for Keith Schembri and Konrad Mizzi, to be eventually owned by trustees running their New Zealand trusts