BOV handed Konrad Mizzi reference letter to open up offshore Panama company

Bank of Valletta provided a reference letter which allowed Konrad Mizzi to open up an offshore company, even if he was handling multi-million government deals that have been mired in corruption.

Matthew Caruana Galizia, the son of assassinated journalist Daphne Caruana Galizia, has published the June 2015 letter, Julian Bonnici reported on Lovin Malta.

In the reference letter, BOV’s chief officer for Corporate Finance Albert Frendo said that his two-year professional relationship with Mizzi was enough to “consider him to be a suitable person to satisfactory operate” the offshore account. That same month, Mizzi established a trust in New Zealand, Hearnville. The beneficiaries of this trust are his wife, Malta’s former consul in Shanghai, and two children.

He then told Mossack Fonseca, the firm at the centre of the Panama Papers scandal, that he would use Hearnville as a management consultancy and brokerage firm.

The Panamanian accounts were first purchased by Nexia BT in July 2013, days after the general election.

“Imagine you’re a manager of a bank, overseeing a €0.5bn loan to a power company, guaranteed by the government.”

“Imagine the minister pushing the government into that guarantee, whom you’ve known only through your work on that guarantee, suddenly tells you he wants from you a reference letter to open an offshore bank account into which he’d receive millions of euros.”

“What would you tell him?” Caruana Galizia wrote.

Mizzi and Keith Schembri’s Panama accounts listed 17 Black as their target client, along with the as-yet-unknown Macbridge. 17 Black is the Dubai account of Yorgen Fenech, the main suspect in the murder.

A report by the FIAU found that 17 Black had received at least three payments – one of €161,000 from Maltese local agent for the tanker supplying gas to the LNG power station and two separate payments amounting to €1.1m from Baratzada through ABLV Bank. ABLV was recently raised in one of Latvia’s most extensive investigations into money laundering yet. More recently, 17 Black was found to be at the centre of a dubious deal involving the purchase of a Montenegro wind farm by Malta’s state-owned Enemalta plc.

Recent reports by Reuters and Times of Malta uncovered that the Maltese government had agreed to pay out €10.3m for a Montenegro wind farm that had just been bought for €2.9m two weeks prior. According to Reuters and the Daphne Caruana Galizia foundation, the other company linked to the deal, Cifidex, is connected to Turab Musayev, a former Electrogas director.