Owners of ‘Panama Papers’ firm linked to Malta face money laundering trial

Aqra dan l-artiklu bil-Malti.

On Monday, a Panamanian court began the trials against several officials in connection with the 2016 revelation of the Panama Papers money laundering scandal.

Among the 27 people on trial are the owners of the Panamanian law firm Mossack Fonseca. The firm set up thousands of dodgy offshore companies for wealthy clients, including disgraced former chief of staff Keith Schembri and minister Konrad Mizzi.

The 2016 scandal, which saw some 11 million financial documents leaked, revealed links to some of the world’s wealthiest people at the highest echelons of power.

In Malta, they were considered a catalyst for the eventual resignation of Schembri, Mizzi, and disgraced former prime minister Joseph Muscat.

On Tuesday, the Associated Press reported how the trial had finally commenced more than eight years after the scandal. The 27 persons involved, which include owners Juergen Mossack and Ramón Fonseca, are being prosecuted in connection with the Brazilian corruption scheme ‘Operation Car Wash’.

While Fonseca did not appear at the trial for purported health reasons, Mossack was present. He claimed he “was not guilty” of the money laundering charges.

Fonseca had previously stated that the now-shuttered Panamanian firm had no control over how its clients used the companies it set up for them. Among other officials, the two owners had been acquitted of separate charges in 2022 related to Brazilian construction firm Odebrecht.

Mossack Fonseca created the Tillgate and Hearnville shell companies for Schembri and Mizżi around ten years ago. The two companies were purchased in 2015 through the Maltese accounting firm Nexia BT, owned by Brian Tonna and now shut down.

They were set to receive payments from companies 17Black and Macbridge, which were suspected kickbacks from the scandalous Electrogas energy deal.

17Black was owned by Electrogas director Yorgen Fenech, who is being charged in connection with the 2017 assassination of journalist Daphne Caruana Galizia.

Macbridge was owned by the mother-in-law of Chinese Electrogas negotiator Chen Cheng.

Another shell company, Egrant, had been purchased alongside Tillgate and Hearnville. Following claims that the company was owned by Muscat or his wife Michelle, an inquiry concluded in 2019 could not find conclusive evidence.

Despite prominent politicians featuring so closely in the scandal, Maltese authorities have failed to take any action to investigate the links.

A public inquiry into the assassination of Caruana Galizia found that apart from not taking any action on the scandal, the police’s work was hampered by Schembri.

Muscat resigned in disgrace as prime minister in December 2019 amid public pressure, just a few months after Schembri and Mizzi’s resignations.

In 2021, Schembri was charged in Malta with an unrelated money laundering case, which is still ongoing.