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Updated | Mizzi, Schembri to sue Caruana Galizia over money transfer allegations to Panama companies

Columnist alleges money transfers to Panama companies and claim she knows ownership of mysterious ‘Egrant’

paul_cocks
Paul Cocks
15 April 2017, 12:38pm
Last updated on 15 April 2017, 1:05pm
Minister Konrad Mizzi (left) and OPM chief of staff Keith Schmebri will be suing Daphne Caruana Galizia on Monday
Minister Konrad Mizzi (left) and OPM chief of staff Keith Schmebri will be suing Daphne Caruana Galizia on Monday
The Prime Minister’s chief of staff, Keith Schembri, and minister Konrad Mizzi announced yesterday they would be filing a libel suit against blogger and Malta Independent columnist Daphne Caruana Galizia on Monday, after she claimed that large sums of money had been transferred from a Azerbaijani bank account to accounts belonging to their offshore Panama companies, and to accounts belonging to Egrant Inc, a third company registered in Panama.

Egrant was one of the three companies set up through the Malta offices of Nexia BT, by Panamanian law firm Mossack Fonseca. But the Panama Papers leaks never conclusively revealed Egrant’s ownership, with Nexia BT boss Brian Tonna claiming on the eve of the Panama Papers committee of MEPs’ visit to Malta that the offshore company was his own.

Schembri and Mizzi said they would also be asking the court to hear his case urgently.

In her post, under the heading ‘Egrant Inc: hiding in plain sight’, the blogger claimed that through a serious of “serendipitous flukes”, she had discovered who owns the third company in the Panama Papers scandal, Egrant Inc.

“This website also has information on several movements of very large sums of money from the bank account of a company owned by politically exposed persons (PEPs) in Azerbaijan to bank accounts held by Egrant Inc, Hearnville Inc (ultimate beneficial owner: Konrad Mizzi, the Minister Within The Office of the Prime Minister) and Tillgate Inc (UBO: Keith Schembri, the Prime Minister’s chief of staff),” she wrote.

A Maltese bank, set up after 2013, was used to move the money, she added.

Caruana Galizia said she would reveal full details this coming week as she was waiting to contact several people for comment and could not reach them over Easter weekend.

In his statement, Schembri denied the claims carried in the blog and said that whoever made any allegations had the duty to substantiate them.  “The internal chaos within the Nationalist Party will usher in a season of lies and fake news,” his statement read. “I am determined not to ignore any further lies and fake stories about me.”

Mizzi too denied the allegations. “No sum of money was ever transferred to Hearnville Inc.,” he said in a statement. “Indeed, Hearnville Inc. never had any bank account.”

He insisted no funds from or related to Azerbaijan were ever transferred in any way to him or any member of his family. “Daphne Caruana Galizia is lying outright,” he said.

In a Facebook post, Keith Schembri said he had replied to questions from the Times, denying holding any interests in Azerbaijan through his Kasco group of companies or having tendered for business there.

He also denied knowing who “Kamaladdin Heydarov’s front-man” was, when asked whether he had introduced the man – ostensibly businessman Manuchehr Khangah – to Nexia BT, his auditors. Khangah, the chairman of the AZ group of companies, had opened six different holding companies – the Bach, Beethoven, Mozart, Puccini, Verdi, and Vivaldi investment holding companies – under parent company Mulsanne Investment, in Malta in 2014, through the offices of Nexia BT. They were dissolved a year later.

A leaked US cable published on Wikileaks, in which the US embassy in Baku profiled the most powerful families in Azerbaijan back in 2010, described Khangah as a front man for the Heydarov conglomerate belonging to Azeri minister Kamaladdin Heydarov and his two sons Nijat and Tale.

The Panama Papers had revealed the existence of Schembri’s and Mizzi’s secret offshore companies, leading to national protests led by the Nationalist Party against Joseph Muscat’s administration. Mizzi was ‘demoted’ to minister without portfolio in the Office of the Prime Minister, but retains to this day responsibility for energy affairs and the completion of the Delimara gas plant, the government’s key policy plank.

paul_cocks
Paul Cocks joined MaltaToday after having spent years working in newspapers with The Times...