Muscat: Claims that Egrant is my wife’s, ‘biggest political lie in country’s history’

Prime Minister Joseph Muscat has categorically denied allegations that his wife, or him, are the beneficial owners of the Panamanian offshore company Egrant or any undeclared bank account.

Muscat announced he will take legal steps against Malta Independent columnist Daphne Caruana Galizia, accusing her of lying about his wife being the beneficial owner of the company. “A lie like this cannot be ignored, especially when it is being substantiated in the most irresponsible and unethical way by the Opposition leader and his party’s media.”

Muscat dubbed the claims as “the biggest ever political lie to ever take place in the history of the country” and said Caruana Galizia had constantly humiliated his family in the past but that they were resolute not to pay her any attention.

Muscat said he was challenging anybody to produce “any shred of evidence” to substantiate the allegations, and that he would be requiring the fullest of authentication of any such evidence. “If there is someone who has managed to produce such a heinous lie, I do not exclude that there would be anything stopping them from producing falsified evidence.”

Muscat said when asked by the PN media that he was asking Caruana Galizia to take any such documentation she was purporting to have, to the police.

#Malta PM Joseph Muscat says allegations of Panama co ownership shld be taken to police https://t.co/sPNYdSQXWr pic.twitter.com/Fdn6zcEvjz

— MaltaToday (@maltatoday) April 20, 2017

Caruana Galizia has claimed that the shares of the offshore Panamanian company set up by Nexia BT – Egrant – are held by Mossack Fonseca nominees for the Prime Minister’s wife, Michelle Muscat.

The claims comes days after Caruana Galizia first posted a photo of Muscat in the company of Leila Aliyeva, the daughter of Azerbaijan president Ilham Aliyev, suggesting she knew who the owner of Egrant was.

Muscat this week told a Labour general conference that he denied holding any offshore companies, or that any of his family members or his wife had an undeclared bank account.

Egrant was set up by Nexia BT at the same time as two other offshore companies, Tillgate and Hearnville, were set up through the offices of Mossack Fonseca on behalf of Keith Schembri, the PM’s chief of staff, and minister Konrad Mizzi. The companies were revealed during the massive Panama Papers leak of 2016.

Both Schembri and Mizzi have this week filed multiple libel suits against Caruana Galizia over allegations of money transfers from Azerbaijan to their company bank accounts.

New allegations

In the latest allegations, Caruana Galizia claims that the documents are declarations of trust showing the shares in Egrant are held by Mossack Fonseca nominees for “Mrs Michelle Muscat”, which were held inside a safe kept in the kitchen of Pilatus Bank in Ta’ Xbiex.

The declarations, she said, were provided to Pilatus Bank by Nexia BT managing partner Brian Tonna, as a prerequisite to open an account for Egrant, which required the identity of the ultimate beneficial owner.

She also said that Muscat’s name was given on the account opening form for Egrant, a document she said was held in the safe.

“These documents have been scanned and uploaded to the cloud, for security purposes,” Caruana Galizia wrote, although she did not publish the alleged documents.

Opposition reactions

Initial reactions came from Green Party chairman Arnold Cassola, who said the allegations were extremely serious. “If what you are implying is true, Maltese democratic values are at stake. Daphne: your words and writing are not enough. Publish all the documentation asap to substantiate your words. Maltese democratic values are at stake!”

Green Party deputy chairperson Carmel Cacopardo said AD was requesting an immediate investigation in order that the known facts and documents are examined in order that the necessary and required criminal action is initiated.

Partit Demokratiku leader Marlene Farrugia, who will run on the PN ticket, said she had emailed the Commissioner of Police Lawrence Cutajar to investigate the allegations.

In a televised address, Opposition leader Simon Busuttil said the Prime Minister had lost all moral authority to lead the country, describing the allegations as grievous.

“The least I would have expected today was for the Prime Minister to appoint an independent inquiry to carry out a serious investigation on the allegations made. Instead he said the responsibility is mine. The responsibility is the Prime Minister’s because Muscat put himself in this situation when he kept Mizzi and Schembri with him at Castille. Because of this, no one can believe him.”

Busuttil said the country did not deserve a Prime Minister who was under a black cloud of corruption. “I would have expected the Police Commissioner to open an investigation and seal Pilatus Bank in presence of a magistrate to see that evidence is elevated... I am holding the Police Commissioner personally responsible and I am insisting with all other authorities to do what they have to do in the national interest.”

Caruana Galizia makes new claims at 11pm

In yet another development, Daphne Caruana Galizia stated that a USD400,000 loan was paid from the bank account of Pilatus Bank chairman Seyed Ali Sadr Hasheminejad's sister Negarin Sadr, who has a fashion business called Negarin London.

Caruana Galizia said that in March 2016, Pilatus Bank received urgent instructions to open an account for Negarin Sadr, for a loan of US$1 million to be granted for Sadr's fashion business, and for approximately US$400,000 of that money to be paid out to a bank account held by “a Maltese woman who lives in New York and has a jewellery business called Buttardi”.

Buttardi is run Michelle Buttigieg, a costume jewellery business that had been set up in partnership with Michelle Muscat in 2003. Buttigieg was also appointed as a government representative for tourism to the United States in 2014.

Egrant and Nexia BT

The notoriety of the company Egrant stems from the fact that its owner was never disclosed in emails leaked from Mossack Fonseca, and that its owner’s identity was communicated to Mossack Fonseca by Nexia via a Skype conversation.

Brian Tonna had insisted in email answers he gave to MaltaToday ahead of the PANA committee of MEPs in February, that he remains the sole owner of Egrant and that the company never traded. “Egrant, purchased by my firm in July 2013, is a shelf company, that is a ready-made company that is available for a client to acquire. It has never had, and does not currently have, any client as ultimate beneficial owner, and it has never been active.”

Caruana Galizia’s claim that Joseph Muscat’s wife Michelle Muscat could be the beneficiary of Egranta caps a week of titillating allegations against the Labour administration, that were met with a barrage of libel suits.

Dubai bank accounts

The PM’s chief of staff Keith Schembri, Konrad Mizzi and Tonna earlier today denied once again that companies Tillgate Inc, Hearnville Inc and Egrant Inc, had ever held any bank accounts.

Caruana Galizia claimed that a Dubai-registered company, Al Sahra FZCO – reportedly owned by Leyla Aliyeva, daughter of Azerbaijani president Ilham Aliyev – had made a single payment transaction of US$1.017 million to Egrant in 2016 through a bank account in Dubai.

“Like Egrant Inc, the other two companies have accounts at a bank in Dubai, too,” she wrote, without stating which bank this was.

Tonna responded that Egrant never received any payments whatsoever from Al Sahra FZCO, whether as a loan payment or otherwise. “As I have already stated publicly, Egrant Inc never traded and never had or tried to open any bank accounts, from which it follows that it never made or received any payments at all… Nexia BT was not engaged by Egrant Inc, or indeed anybody else, in connection with the payments alleged to have been made, and never contacted Pilatus Bank, or indeed any bank, in that regard.”

Caruana Galizia claimed that the alleged loan payment was made from Al Sahra’s account at Pilatus Bank in Malta.

On his part, Keith Schembri challenged Caruana Galizia to support her allegations with evidence. “Six days have passed and all we’ve only heard lies from Simon Busuttil and Daphne Caruana Galizia,” Schembri said in a statement. “Tillgate Inc never held any bank accounts. I am serenely asking Caruana Galizia, or anyone else, to present any proof as soon as possible.”

Similarly, Konrad Mizzi said that Hearnville Inc never held any bank account, reiterated that he had commissioned an audit of the New Zealand trust Rotorua which was managed by trustees on behalf of Hearnville Inc. “The trustees engaged Crowe Horwath, one of the largest public audit and accounting firms in the world, and the audit established that the financial statements of the structure were presented fairly, in all material respects and in accordance with accounting policies,” Mizziaid.

“The auditors have confirmed that the evidence they obtained was sufficient and appropriate to provide a basis for their audit opinion. This confirmed that the structure is solely intended as a family trust and that no bank accounts were held by the trust and company.”

Mizzi added: “Daphne Caruana Galizia is again lying outright. She has not provided a shred of evidence in support of her allegations.”

Mizzi, who today filed libel proceedings against Caruana Galizia on the back of another libel over allegations of money transfers from Azerbaijan to his offshore company, added that he would continue to pursue legal action “to ensure that all untruths are met with full legal sanction.”