Govern­ment to con­sider launch­ing sec­ond round of pass­port sale scheme

Hen­ley and Part­ners also re­ceiv­ing com­mis­sion from sale of govern­ment bonds - Az­zopardi

Malta Independent - - FRONT PAGE - Neil Camil­leri

The govern­ment will con­sider whether to launch a sec­ond In­di­vid­ual In­vestor Pro­gramme once the cur­rent cit­i­zen­ship-for-sale scheme is fully taken up, Jus­tice Owen Bon­nici has said.

Dr Bon­nici was be­ing in­ter­viewed by PBS Head of News Reno Bugeja on Dis­sett yes­ter­day evening.

The con­tro­ver­sial IIP, which was fa­mously amended four times, in­clud­ing with the in­clu­sion of a res­i­dency re­quire­ment, was capped at 1,800 main ap­pli­cants. It has so far been un­der­stood that the IIP would be a one-time thing. But when asked by Mr Bugeja if the govern­ment would ex­tend the pro­gramme be­yond its first round Dr Bon­nici said: “We are halfway into a good job and you are ask­ing me if we will launch an­other round when this one is over. We will do ev­ery­thing we can to en­sure that the cur­rent job is a suc­cess. When we reach the end of this pro­gramme we will dis­cuss whether there will be an­other one.”

Min­is­ter ‘lied to Par­lia­ment’

In the first half of the talk show, Shadow Jus­tice Min­is­ter Ja­son Az­zopardi said the re­cently pub­lished IIP Reg­u­la­tor’s re­port had un­cov­ered a new “scan­dal”. Dr Az­zopardi said Hen­ley and Part­ners, the con­ces­sion­aires of the IIP, were be­ing granted a 4% com­mis­sion on govern­ment stocks they sold to ap­pli­cants.

Apart from pay­ing €650,000, ap­pli­cants have to pur­chase the manda­tory €150,000 in govern­ment stocks and buy a prop­erty worth at least €350,000 prop­erty or rent a prop­erty for a min­i­mum of €15,000 per year.

“These scan­dalous facts un­cover this govern­ment’s, and in­deed the Min­is­ter’s de­ceit. Owen Bon­nici came be­fore the Par­lia­men­tary Ac­counts Com­mit­tee and told us that Hen­ley and Part­ners was only re­ceiv­ing a 4% com­mis­sion from the €650,000 and noth­ing else.”

Dr Az­zopardi said the govern­ment had de­cided to give an­other gift to Hen­ley and Part­ners, which he said was one of the com­pa­nies “in­volved in the fa­mous PL HQ fourth floor meet­ings” be­fore the 2013 elec­tion.

“Which govern­ment in the world with a shred of de­cency that gives com­mis­sions to for­eign­ers on the sale of its own bonds?”

When Mr Bugeja pointed out that all stock­bro­kers charged a fee for their ser­vices, Dr Az­zopardi said Hen­ley is not li­censed as such. “As a re­sult the govern­ment is in breach of fi­nan­cial ser­vices laws. This is scan­dalous and it is un­fair on stock­bro­kers.”

PN will not ex­tend IIP

Dr Az­zopardi said the PN was still against the IIP in prin­ci­ple and, if elected to govern­ment, would not ex­tend the pro­gramme. “Some things are just not for sale.” He said, how­ever, that at the cur­rent rate the pro­gramme would not last un­til then and the 1,800-per­son cap­ping would be reached be­fore the elec­tion.

The PN shadow min­is­ter ques­tioned how the money gen­er­ated from the sale of pass­port was be­ing spent. “Have you seen a sin­gle rub­ble wall that has been built with IIP funds,” he asked the pre­sen­ter.

“The €300 mil­lion are, ac­cord­ing to the re­port, be­ing held in a sus­pense ac­count. There is no men­tion of such an ac­count in the law. Do we know who is re­ceiv­ing the in­ter­est on €300 mil­lion? Could it be that this ac­count be­longs to Hen­ley as well, and that it is tak­ing these mil­lions in in­ter­est?”

He also pointed out that IIP sales ac­counted for 3% of GDP and ques­tioned whether this sit­u­a­tion was sus­tain­able.

‘We are in­cen­tivis­ing them to at­tract in­vest­ment’

Re­act­ing dur­ing the sec­ond part of the pro­gramme, Jus­tice Min­is­ter Owen Bon­nici de­nied the sug­ges­tion that the govern­ment was sub­si­dis­ing Hen­ley and Part­ners. “The govern­ment wants to at­tract in­vest­ment and it is will­ing to give them €4 from every €100 they bring over. This is an in­cen­tive to the con­ces­sion­aire to bring in in­vest­ment.”

Dr Bon­nici said it was not true that the coun­try was reg­is­ter­ing eco­nomic growth as a re­sult of the IIP and in­sisted that this growth was be­ing reg­is­tered across the board.

Asked about the ap­par­ent lack of en­force­ment on res­i­dency, Dr Bon­nici said it was un­true that Malta was fail­ing to ad­here to the rules and said it was ac­tu­ally go­ing over and above what the Euro­pean Com­mis­sion had in­structed. “We said right from the out­set that we wanted ap­pli­cants to form a gen­uine bond with the coun­try. This does not ne­c­es­sar­ily come from res­i­dency in Malta. One way in which they are devel­op­ing a gen­uine link is the fact that they have given, out of their free will, over €1 mil­lion to phi­lan­thropic groups.” He said Her­itage Malta was one of the or­gan­i­sa­tions that was mak­ing use of these dona­tions.

Dr Bon­nici said he had met with some of the suc­cess­ful ap­pli­cants af­ter they were granted cit­i­zen­ship. “These are high net worth in­di­vid­u­als. They lead life­styles we can only imag­ine. I am very proud that these 300 fam­i­lies have be­come part of our so­ci­ety.”

He likened some of the IIP ap­pli­cants to US Pres­i­dent-elect Don­ald Trump. “The US has elected as pres­i­dent a per­son who is very suc­cess­ful in build­ing. We are speak­ing about these type of peo­ple – peo­ple who are suc­cess­ful – 300 fam­i­lies with links we could not even dream of.”

IIP funded projects to start in 2017

In a recorded seg­ment, David Curmi, the Chair­man of the gov­ern­ing board of the Na­tional De­vel­op­ment Fund said over €130 mil­lion has been de­posited into the fund’s ac­count so far. He said the board is cur­rently draw­ing up a strat­egy on how these funds will be al­lo­cated. They can be spent on projects of a so­cial na­ture, projects of na­tional im­por­tance and for projects for fu­ture gen­er­a­tions. Sec­tors that will be given im­por­tance are the so­cial, so­cial in­clu­sion, health, ed­u­ca­tion, re­search and in­no­va­tion sec­tors.

These projects will start tak­ing shape by early next year, Mr Curmi said.

The €300 mil­lion are, ac­cord­ing to the re­port, be­ing held in a sus­pense ac­count. There is no men­tion of such an ac­count in the law. Do we know who is re­ceiv­ing the in­ter­est on €300 mil­lion? Could it be that this ac­count be­longs to Hen­ley as well, and that it is tak­ing these mil­lions in in­ter­est?

Owen Bon­nici

Ja­son Az­zopardi

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