Panama Papers | Nexia says third offshore company Egrant is still shelf company

Brian Tonna, the managing partner of Nexia BT, has insisted that two offshore companies acquired for Konrad Mizzi and Keith Schembri 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 requested the Panamanian law firm to set up the offshore companies that were only later formally registered in Mizzi’s and Schembri’s name, just days after the 2013 election.

But Tonna disputes the claim that the two companies, Hearnville and Tillgate, were destined for Mizzi and Schembri.

“As a service provider we had acquired 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 companies,” 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.”

Hearnville and Tillgate were the offshore companies transferred to the trustees of Mizzi’s and Schembri’s offshore trusts in New Zealand, which Nexia  BT set up: they are called the Rotorua and Haast trusts, respectively, and are run by accountants from the Orion Trust Ltd of New Zealand.

The Panama Papers, a leak of 11.5 million documents from Mossack Fonseca, revealed emails showing Nexia partner Karl Cini, contacting the Panama office on 14 Marh, 2013 to set up shell companies. “When you can please send me details for setting up a Panama company and possibly a trust,” he wrote.

The ultimate beneficial owner (UBO) for the Panama company and trust “will be an individual and I will speak to Luis on Skype to give him more details,” Cini wrote.

On 4 December, 2014, Cini told Mossack Fonseca he would be setting up two New Zealand foreign trusts, allegedly to own the Panama companies set up for Schembri and Mizzi. Their trust document was completed in May 2015.

On 8 August, with the trust formation still in place, Cini wrote to Panama: “We are in the process of opening a bank account in Dubai for two of our Panama companies. The bank is asking as for the following documents which need to be attested from the UAE Embassy of Panama. They will then attest them further in Dubai.”

But due to their status as PEPs (politically exposed persons), both the unnamed Dubai bank and the FPB Bank of Panama did not proceed with opening the bank account for Hearnville Inc and Tillgate Inc.

Konrad Mizzi has stated that no account was ever opened, and that the accounts were the initiative of Nexia BT.

Schembri denial

The Prime Minister’s Chief of Staff, Keith Schembri, has also “categorically 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 Zealand 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 OFM chief of staff said it was inconceivable that a newspaper would allow comments attempting to link unmentioned “business figures” to the government without any substantiation or the faint attempt to corroborate it in fact. “The tone, scope and elaborate insinuations 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.

“I welcome legitimate, accurate and fair criticism and the right of freedom of expression and the freedom of the media but only if the information is correct and corroborated as it is not in the general public’s interest to be misled,” Schembri said.

Pierre Sladden offshore company

The AFR also reported that businessman Pierre Sladden, a key contractor in the conversion of the Mriehel factory that today houses Progress Press, which is owned by Allied Newspapers, also used Nexia BT.

Emails revealed by the AFR show that Sladden’s company Redmap Constructions owned a Cyprus company A2Z Consulta – whose directors are also nominees Best Servus of Cyprus – €900,000 for “the provision of services consisting in quality checks and negotiation with suppliers”.

According to the AFR, the Cypriot company sub-contracted the quality checks and negotiations to Blue Sea Portfolio, in the British Virgin Islands, now due US$978,150 – and it turns out it was another Sladden company that would pay the debt.

Mossack Fonseca records show that behind a nominee holding, it is Pierre Sladden himself who owns the 50,000 shares in Blue Sea.