Issue link: https://maltatoday.uberflip.com/i/694236
maltatoday, SUNDAY, 19 JUNE 2016 16 MATTHEW VELLA THE Swedish Pensions Agency (SPA) has delivered a damning verdict on the way a Maltese pen- sion fund was being run and on the involvement of one Emil Ingman- son, a Swedish entrepreneur who has business interests in Malta, and who is now alleged to have had some sort of access to the money Swedish pensioners poured into Falcon Funds. Picking up the pieces was Na- tionalist MP Tonio Fenech, one of the three directors of Falcon Funds SICAV, a €276 million pen- sion fund which reinvests the pen- sion savings in blue chip stocks like BMW, Allianz and Michelin. Fenech is not the owner – the SICAV is 'owned' by Falcon Funds' 23,000 savers themselves, who can redeem their savings on any day. The former finance minister says the SICAV will take legal action against the SPA, which he accused of having an agenda against the Maltese fund, after they brusquely delisted Falcon Funds from the Swedish premium pension plat- form. "The SPA did not give us a right to appeal the decision. On the content of the letter per se, this clearly leaves much to be desired," he said. But the Swedes have hammered out a thorough 15-page decision listing their suspicions about Fal- con Funds: misleading sales tactics, the role of Ingmanson in starting and now, taking control of Falcon Funds' investment decisions, sus- pected takeovers of clients' IDs, and even the possible misuse of €31 million for Ingmanson's own ends. So serious, that the SPA want Falcon Funds out of their pension system because they claim they are not acting in the interest of Swed- ish pension savers. The SPA claims that either Fal- con Funds or Temple Asset Man- agement, the investment manager of the fund, are aware of how this money has been invested: specifi- cally in instruments for the benefit of Ingmanson, "which constitutes a conflict of interest… [these instru- ments'] design is purposely non- transparent in order to veil any further analysis of the underlying assets and their risks." Fenech doubts that the grounds on which the SPA condemns In- gmanson, saying they are claims made by press articles and that no case of conviction in the Swedish courts or decisions by the Swedish Financial Services Authority back up the allegations against him. Ingmanson: common denominator The reason Ingmanson is the dark horse in the downfall of Fal- con Funds is the way he features in the pension fund: nowhere at all, and everywhere. You cannot find him listed anywhere, but the SPA says a trail of breadcrumbs con- vinces them otherwise. In November 2013, when Falcon Funds was authorised by the MFSA to market its sub-funds in Sweden, Ingmanson represented the fund in talks with the SPA. He had already been the subject of police investi- gations on false accounting and tax fraud, with a history of bankruptcy behind him. While Ingmanson is not a direc- tor of Falcon Funds, he is position- ing himself to take control of Fal- con Funds' investment decisions. To do this, he is awaiting for a li- cence from the MFSA so that Fal- con Asset Management takes over from Temple as investment man- ager of Falcon Funds. And both Temple and FAM share the same Floriana address. Tem- ple's own CEO was a director on FAM up until February. The SPA has argued that not all the pension money is going into blue chip stocks. Falcon Funds in- vested €31 million in three ETIs (exchange traded instruments) that are too opaque for them to know what the money is being used for. "It is not possible to measure, either the investment potential or the risk exposure associated with an investment in the ETIs… it seems clear it did not matter for Falcon Funds what type of under- lying asset the sub-funds would be exposed against through an invest- ment in the ETIs. Rather, the only reasonable explanation is that Fal- con Funds made the investment in order to accommodate the interest of a third-party beneficiary." That beneficiary could well be In- gmansom, the SPA suggests. First of all, two ETIs have names – Solid Venture P2P and Board- walk Real Estate – already associ- ated with Ingmanson. In Malta, Ingmanson set up Solid Venture Capital back in 2012. He trans- ferred its ownership in 2013 to an Isle of Man company called Roxy Tiger Limited (the names of his two children). Together with another Isle of Man company called Board- walk Limited, these two companies are officers of the company Met- ropolitan Venture Capital LLP. So far, so coincidental. Secondly, the SPA suspects Ing- manson uses the money invested in these ETIs so that he can extend this capital as credit to other com- panies. To prove the incestuousness of Ingmanson, Falcon and Temple, the SPA said emails leaked from a renowned international bank, showed Ingmanson using a falcon- funds.eu domain and Temple let- terhead. The emails show Ingman- son requesting to set up similar ETIs in Luxembourg, and Temple's COO Philip Eaton Richards reveal- ing that Ingmanson's new com- pany Falcon Asset Management would be soon taking over as Fal- con Funds' investment manager. "There are good reasons to sus- pect that the plan was that the proceeds from investments made through the structured products proposed to the bank, would be used by companies closely linked to Ingmanson," the SPA said. An example was a €3 million emergency loan his company Solid Venture Capital extended to be- leaguered payday loan company Trustbuddy in the summer of 2015. Ingmanson's 'kickback' was sup- posed to have been 10%. Provided that this episode, as reported in the Swedish press, is accurate, this is what the SPA suspects that Ing- manson could be using the money for. The Swedish Pensions Agency said that a further investigation by the MFSA would question whether Falcon Funds' investments in the Solid Venture, Boardwalk, and WV Mittelstand ETIs are a conflict of interest when Ingmanson could be their beneficiary. "The agency con- cludes that the sub-funds invest- ment into the ETIs is in breach of the obligation of Falcon Funds to act in the best interest of its share- holders and in breach of its obliga- tion to carry out its assignment in a prudent and professional manner." Fenech insists that the MFSA has specifically written to the SPA and gave them the assurance and con- formation that the assets Falcon Funds invested in are UCITS eligi- ble. "The contract clearly says that the SPA is not an authority and the authority to whom we are account- able regulatory wise is the MFSA since we are licenced in Malta." Illegal fund transfers But Ingmanson's curious role ex- tends to another serious allegation against Falcon Funds, which is pre- cisely in the way their fund grew to €270 million by the end of 2015. The SPA claims that Ingmanson is a common factor in the way a massive customer register was used "as a tool for criminal and il- News Swedes say 'deceitful, fraudulent' tactics led them to halt pension fund A Malta-run pension fund has been tarnished by allegations from the Swedish Pensions Agency that it was being used to benefit a suspicious third party, using opaque financial instruments Falcon Asset Management Falcon Asset Holdings Directors: Tonio Depasquale, Guido Mizzi Directors: Tonio Depasquale, Guido Mizzi Temple director Anthony Farrell resigned directorship in FAM in March 2016 FALCON FUNDS Sicav runs three pension funds Directors: Tonio Fenech, Joseph Xuereb, Ian Zammit created 22/11/13 Emil Ingmanson served as the go- between for Falcon Funds and the Swedish Pensions Agency created 27/7/15 created 31/7/15 Temple Asset Management Comino Holding LLP (London) Falcon Gozo • Falcon Comino (Isle of Man) TAM makes the investment decisions for Falcon Fund. Its Floriana building also houses Falcon Asset Managament, a separate company from Falcon Funds In February 2016, Ing- manson transferred his one share in Falcon Asset Management to Falcon As- set Holdings, and onwards to Comino Holding LLP in London. created April 2015 The owners of Comino Holding are Falcon Gozo and Falcon Comino, whose real owners are hidden be- hind Isle of Man nominees. owned by owned by The Swedish Pensions Agency suspects that €31 million that Falcon Funds invested in the instruments Solid Venture P2P, Boardwalk Real Estate, and VW Mittelstand, were used for Ingmanson's own ends. Solid Venture Capital (Malta) Director: Nils Holmstrom created 11/12/12 Metropolitan Venture Capital (London) Roxy Tiger (Isle of Man) Boardwalk Limited (Isle of Man) MVC London's directors are two Isle of Man companies Roxy Tiger owns Solid Venture Capi- tal in Malta. Ingmanson resigned as director and secretary of Solid Venture Capital in early 2016 Emil Ingmanson