Malta’s anti-money laundering unit (FIAU) is unable to say if any regulatory action has been taken against government consultants Nexia BT.
Last month, FIAU director Kenneth Farrugia warned financial intermediaries during a training conference that combatting money-laundering was a shared responsibility and not just the unit’s task.
Financial intermediaries are legally obliged to report suspicious activities by their clients to the FIAU.
Despite being at the heart of the Panama Papers scandal, government consultants Nexia BT have so far escaped any apparent regulatory action.
The firm set up secret offshore structures for the Prime Minister’s chief of staff Keith Schembri and Tourism Minister Konrad Mizzi without notifying the tax authorities.
According to one e-mail found in the Panama Papers, the two government officials were set to receive payments of up to $2 million, a figure far greater than their modest government salaries.
A leaked FIAU report about Dr Mizzi accused Nexia BT of withholding information from the unit during the course of its Panama Papers investigations.
Nexia BT were retained as advisers to the PM’s office following the scandal
Replying to questions by Times of Malta, FIAU deputy director Alfred Zammit said the FIAU adopted a risk-based approach when carrying out its supervisory functions, as required by international standards.
Mr Zammit said confidentiality obligations meant the FIAU was not in a position to confirm whether the unit had or would be taking any supervisory action on Nexia BT.
Nexia BT partner Karl Cini was called in for police questioning last year soon after selected conclusions of the Egrant inquiry were published in July.
The firm’s managing partner Brian Tonna is facing a magisterial inquiry after a leaked FIAU report raised suspicions that he passed on a €100,000 kickback on passport sales to Mr Schembri.
All those involved deny any wrongdoing.
Accountancy Board chairman Peter Baldacchino told Times of Malta last month that “different exercises” were under way when asked about the apparent inaction against financial advisory firm Nexia BT.
Dr Baldacchino said the regulator could not publicise its every move and had always taken action when needed. Both Mr Cini and Mr Tonna resigned from the Malta Institute of Accountants in 2017 after it was made known they would face disciplinary action in the wake of the Panama Papers scandal.
The firm has received over $800,000 in government contracts since Labour returned to power in 2013.
Mr Tonna was employed full-time in 2014 by the Justice Ministry on a contract worth €5,000 per month.
He retained the contract even after the Panama Papers hit the headlines in 2016.
Nexia BT were also retained as advisers to the Prime Minister’s office following the scandal.