Issue link: https://maltatoday.uberflip.com/i/878567
8 MATTHEW VELLA THE suspension of a Maltese asset manager's pension fund offered to Swedish savers has prompted a re- port by the country's national pen- sion agency, calling for an over- haul of the system. The investigation into Sweden's premium pension system, which supplements national pensions, was prompted by the criminal in- vestigation launched into Falcon Funds, which was managed from Malta. One of its directors was the for- mer Nationalist MP, Tonio Fene- ch. Malta's financial regulator ap- pointed auditors KPMG to take control of the pension fund, after it was investigated by the Swedish Economic Crime Authority over allegations that the fund was una- ble to pay back a total of €247 mil- lion (2.4 billion Swedish kroner) in savings to 22,000 investors. The Swedish pensions authority recently announced that Falcon Funds would pay back 315 million Swedish kroner (€33 million), far less than what was expected to be recouped. The money will be de- posited back into savers' pension accounts. "It is of course positive that pen- sioners who have had Falcon's funds now will get back some of the missing money. However, there are very large amounts that are still missing and that is very serious," the Swedish pensions au- thority legal counsel Mikael West- berg said. Prosecutor Arne Fors, who is conducting the criminal investi- gation, also said that the money has been traced to 10 different countries. Now a new inquiry into Swedish pensions has prompted econo- mist Stefan Lundbergh to call for more state control on the private funds that offer the premium pen- sions. Lundbergh was appointed to re- port on the pensions' system over- haul following the Falcon Funds suspension. "The system is not suited to the way people behave… we know that people are not as interested in the management of their pen- sions. Efforts for more education and transparency have not sig- nificantly made people any more interested. We have to adapt the system to make it safer anyway," Lundbergh said. The pension group that under- took the study includes repre- sentatives of Sweden's political parties. "There is broad consensus that we must jointly take respon- sibility for the development of the pension system," group chairman Annika Strandhall, Sweden's so- cial policy minister, said. Falcon suspension Falcon Funds offered three sub- funds on the Swedish pension system, before it was accused of defrauding 22,000 pension inves- tors by the Swedish pensions au- thority and delisted from the PPM system. Falcon Funds' directors have now sued their investment manag- ers Temple Asset Management for damages, claiming they invested over €10 million of savers' cash in what turned out to be an 'advance' to the mysterious Swedish trader Emil Ingmanson. The reason Falcon Funds turned into a national scandal in Sweden is because the Swedish pensions agency believes the pension fund benefited from an irregular trans- fer of savers' cash during a merger of clients of two private funds. The trail of breadcrumbs led to Emil Ingmanson, who in Novem- ber 2013 actually represented Fal- con Funds in talks with the SPA to market its pension funds. Ingmanson, who owns a Sliema property, wanted to open his own investment company Falcon As- set Management, which had its address at Temple Asset Manage- ment's offices in Floriana, so that it could take over Falcon Funds' investment control. The upshot was a grave conflict of interest at play: money deposit- ed by Swedish pensioners with Fal- con Funds was being invested by its investment manager, Temple, into financial instruments owned by Ingmanson, while knowing he planned to replace it as investment manager with his Maltese compa- ny Falcon Asset Management. Temple was fined a total of €612,000 by the Malta Financial Services Authority over breaches of 23 different standard licence conditions and had its licence sus- pended. Now Ingmanson lives in Lon- don, where he is reported to have changed his identity, according to Swedish newspaper Expressen. In Malta, Falcon Funds has filed a court injunction against any at- tempt by Ingmanson to sell his apartment. mvella@mediatoday.com.mt maltatoday, SUNDAY, 24 SEPTEMBER 2017 News KPMG release €33 million from Falcon Funds to Swedish pensioners, as saga leads Swedish pensions group to propose a total overhaul of their pensions system John Farrell's (left) Temple Asset Management had its licence suspended by the MFSA and was fined €612,000 for its role in the Falcon Funds fiasco. One of the pension fund's directors was Tonio Fenech (right). The fund's investment decisions were principally managed by Temple, which is now being sued by Falcon Funds Swedish MPs discuss pension overhaul after Malta imbroglio Swedish minister Annika Strandhall