Malta Institute of Accountants President Franco Azzopardi this afternoon confirmed with The Malta Independent that the institute has initiated disciplinary proceedings that could see Nexia BT Managing Director Brian Tonna and his business partner Karl Cini have their membership revoked.

The MIA contacted this newsroom after receiving a barrage of criticism and accusations that it had not taken action against Tonna and Cini over their roles in the Panama Papers scandal. The criticism was in response to a press release that can be found here.

Asked if the MIA has written to the Accountancy Board, which issues and revokes warrants for accountants, and whether it would take action against the pair, Mr Azzopardi said that, “We have been watching the allegations that have surfaced since the Panama Papers and also let’s not assume that our institution has some form of executive investigative powers.

“However, action from the MIA council has been triggered so the disciplinary procedure process has started and it will take its due course for their membership to be revoked. I can’t tell you when it will be finalised because that is beyond me but a letter has been written to the accountancy board. It’s important to stress that our judgment will only lead to persons remaining as members of the institute or not.”

He went on to explain that any infringements are covered by strict internal procedures, and that he stressed that everyone is innocent until proven guilty.

Asked if the Institute has some sort of a structure that guides its members when they are approached by politically exposed persons he said, “No, but there is a high level of scrutiny and due diligence which he has to exercised. This will entail that if the accountant senses that something is wrong, like where the income is coming from, then he or she has legal a obligation to report to the FIAU.”

The Panama Papers after-effect

Asked if MIA members are concerned with the present assault on Malta’s financial services sector, Mr Azzopardi explained, “Those members who do their job in a professional way and are very responsible in their job are worried about this current situation. Over 30 years ago we started transforming the old offshore regime and now we have reached a stage where we excel in this field and other countries are trying to compete with us.

“This whole journey was a result of hard work mainly done by accountants and we have managed to be really and truly a centre of excellence. We obviously have foreign jurisdictions who do not like us because they see us as competitors. Members feel that their job is being threatened with this sentiment that is growing especially in the in the international eyes.”

Asked whether he feels the snap election and the allegations that surfaced in the recent weeks have had any repercussions on the financial sector, Mr Azzopardi said, “No, not really. However, I do believe that some damage was done out there. Our country can withstand anything as long as it remains in good repute. We have a financial services centre of excellence with an outstanding reputation. Remove that reputation and we are in the third division. As a nation we need to fight this tooth and nail.”

Mr Azzopardi said that foreign clients are watching the situation to see how it will unfold and from what he has heard, “We have clients rethinking their future strategy of whether to remain in Malta or not. We want to play in the premier division of the financial service so this means we want to attract companies with certain behaviour and reputation. Now if in the media we are called names these companies will not be happy to come here.”