Julie Meyer: the pot calling the kettle black

The media recently reported that Julie Meyer was sullying Malta’s reputation saying among other things that “people in the know say investment firms are fleeing Malta due to its toxic reputation and a jurisdiction that just doesn’t work”.

In her opinion: “We have found Malta to be an exceedingly difficult jurisdiction in which to work. She pours more scorn saying: “Absolutely nothing was simple, and actions which should have been done in a matter of weeks took months and quarters to achieve. In no way, shape or form can Malta become world-class for funds anytime soon.”

Ms Meyer said her company Ariadne Capital could not bank in Malta due to its “medieval, ‘guilty-until-proven-innocent’ approach” of the garnishee order system. Previously, during her first encounter with the island, she named herself part of ‘Team Malta’ yet it is a dichotomy that last month she decided not to domicile her fund here, saying that Malta was an “extremely difficult jurisdiction”. Last June, Julie Meyer told investors that her UK-based fund would be redomiciled to Malta as a ‘notified alternative investment fund’. The fund was to be administered by Alter Domus.

Regrettably, Ariadne Capital went into bankruptcy administration on 21 December 2016 such that a letter sent to creditors shows that business rescue company Leonard Curtis placed it into administration on 15 December. Earlier on, Meyer had said she always felt welcome in Malta, stating that the chairman of the MFSA (an autonomous regulator for banks, funds, insurance entities, and so on) was in regular contact with her. The chairman even informed all and sundry that it was seriously good news that Ariadne had come to Malta.

He hosted a dinner for her and her coterie of investors in early September where he allegedly positioned himself as an innovator in financial services and impressed everyone. MFSA is an independent top financial regulator and is restricted from openly promoting the industry. In his defence, the chairman, Joe Bannister, distanced himself from this claim. When the media asked him whether this was a conflict of interest, he quickly denied that the dinner was in her honour. Bannister shrugged off the implication of blatant abuse, stating: “There was a working dinner for a number of representatives of foreign institutions to discuss financial regulation in Malta and the progress achieved so far.” This is interesting since PKF has on many occasions requested support from MFSA to organize international events to attract FDI and the reply was always that this is cannot be sanctioned. For example, no support was forthcoming two years ago when PKF requested logistical help to organize a top-level promotion to attract Captives in a New York conference held at the prestigious Bar Association. Our request was met with smiles and encouragement but MFSA said it did not sponsor promotions. Other refusals followed requests by PKF for support from Mimcol and Malta Enterprise regarding extensive promotions in Dubai and China.

At this juncture, one may be curious to know why so much support was given to Julie Meyer because in a jiffy the smooth-talking presenter had taken the local scene by storm. She first visited the island when Kenneth Farrugia – chairman Finance Malta – invited her to speak at a conference in May 2016. At that time she had no office and worked out of a hotel room at Westin Dragonara. Another invitation as a guest speaker followed from Simon Azzopardi, organizer of Zest and more recently, Ariadne Capital aided the sponsorship of Finance Malta, Mimcol, Alter Domus and others, to host the prestigious “Follow The Entrepreneur Investor Summit” which was held at the Westin Dragonara. This attracted an impressive fee-paying audience who had the privilege of listen- ing to a keynote speech delivered by Prime Minister Joseph Muscat.

In December 2016, the UKbased Ariadne Capital bought a start-up asset management company, Portcullis, which had no assets, and with it managed to pass the MFSA’s fit and proper test; thus it effectively registered as fully compliant with a Category 2 licence.

Ariadne Capital Malta was the name given to Portcullis Asset Management which instantly provided Ariadne Capital with a regulatory investment platform. When two directors suddenly resigned, she confided to the media that she was not being investigated by the MFSA and the company had “plenty of directors” listed on its website, yet documents filed at the Company Registry show Ms Meyer as the only remaining director of the licensed entity.

As an American born in Michigan with a flair for words laced with economic terms and esoteric quotes, she was held in high esteem in London. As a guest at Downing Street, she was honoured as a “global leader for tomorrow” by the World Economic Forum, and later in 2010, she joined thenBusiness Secretary Vince Cable’s entrepreneurs’ forum.

A year later, she was given an MBE for her services to entrepreneurship and was a judge for the online version of the BBC television series “Dragons’ Den.” Readers may wish to know that Ariadne Capital is no stranger to litigation. “In 2015, Ariadne Capital was taken to court by Startup Loans Company over what it claimed was a failure to distribute money that was intended for small businesses. Meyer, however, claimed that the agreement had left her company out of pocket. She eventually lost the case and was ordered to hand back the £50,000 in loans. Ariadne was supposed to hand out such amounts to businesses under a taxpayer-funded scheme to help entrepreneurs. One former member of Ariadne’s team, consultant Rachel Lowe, had to fight a legal battle lasting more than three years to get money owed by Ariadne. Lowe’s job was to support Ariadne clients and find sponsorship partners for Entrepreneur Country, Ariadne’s community for start-ups and small businesses. The story takes another twist when one discovers how stressful and expensive the fight has been for Lowe. Despite numerous efforts by Meyer to have the case dismissed or adjourned, when Lowe finally had her day in court the judge described Meyer as “not credible” and said her evidence at times “bordered on the hysterical” in a damning judgment in the Central London County Court. The judge finally awarded Lowe, £64,500 with more costs to follow.

In conclusion, one may be tempted to ask why the media has reported Ms Meyer’s claims that tarnish Malta’s reputation, branding it a toxic country so close to the days following the bankruptcy announcement of Ariadne Capital.

All this has occurred in the obscure shadows of a recent PANA EU committee visit to investigate the discovery of secret Panama companies incorporated by Nexia BT for top political persons. At the same time, another MEP committee started its investigation into the rule of law following the assassination of a blogger: these factors have given our reputation a blow albeit nothing stops us from making amends and acting contrite.

Moreover, Meyer’s recent sour grapes statement should be taken with a pinch of salt and one hopes the press refrains from giving such claims undeserved coverage. Unless there is a hidden agenda – we can stop shouting about them from the rooftops and start a damage-limitation exercise.

Julie Meyer