Nexia boss uses offshore firm to ‘propose’ golden passport clients

The audit firm that advised energy minister Konrad Mizzi and the Prime Minister’s chief of staff Keith Schembri on setting up offshore firms in Panama, has used an offshore firm to sub-contract 'promotional work' tied to the sale of Maltese citizenship.

Brian Tonna, a partner of advisory firm Nexia BT, used an offshore company registered in the British Virgin Islands to act as a sub-contractor for the sale of the Individual Investment Programme.

The IIP sells Maltese citizenship to the global rich for €650,000, apart from other property and stock acquisition requirements.

The documents showing the establishment of the firm were revealed by the Malta Independent columnist Daphne Caruana Galizia, and are believed to form part of the trove of 11.5 million documents leaked to the International Consortium for Investigative Journalists, from the Mossack Fonseca email server.

Nexia BT is the Malta agent for Mossack Fonseca, the Panamanian law firm that specialises in the creation of offshore firms used in tax avoidance schemes.

The documents show Brian Tonna as the ultimate beneficial owner of the company Willerby Trade Inc, set up on 20 June 2013, which is however run by a Mossack Fonseca company, ATC Administrators.

Both Nexia partners Brian Tonna and Karl Cini possessed a power of attorney for Willerby Trade.

In March 2014, Tonna created an agreement between his company BT International – a registered agent of the Individual Investor Programme – and Willerby Trade, so that the BVI firm could act as an introducer of prospective clients to BT International.

There is no smoking gun of anything illegal, but the set-up would allow Tonna to use Willerby Trade in the British Virgin Islands to invoice BT International for fees on any clients referred to the IIP – the ultimate aim can be that of hiding incomes generated from the sale of citizenship, from the Inland Revenue Department.

"I want to reassure you and your readers that any revenues processed through the BVI firm Willerby have been duly declared with the Inland Revenue Department and all relevant taxes accrued for and paid," Brian Tonna told MaltaToday. "So your suggestion that this structure was set up to hive off commissions payable on the IIP referral or any other income out of reach from the Inland Revenue Department is entirely unfounded and speculative."

Nexia BT enjoys a close relationship with the Labour leadership, not least having advised both Konrad Mizzi and Keith Schembri on setting up offshore companies in Panama and offshore trusts in New Zealand – revealed in the press by the Australian Financial Review in the course of the Panama Papers reports.

There are 131 agents selling Maltese citizenship under the IIP, which include sole practitioners, audit companies such as Nexia BT, Chetcuti Cauchi Advisors, Grant Thornton, PricewaterhouseCoopers, KPMG, RSM Malta, and Deloitte Audit.

Much criticised by the Nationalist opposition for its initial secrecy, the scheme proved irresistible to law firms whose senior partners hail from the PN’s political fold, amongst them Fenech & Fenech Advocates, IURIS Management, Ganado Trustees, GVTH Advocates, and M. Demajo Maritime.