17 Black was listed as the ‘Main Client’ and ‘Possible Payer/Sender’ of Tillgate and Hearnville, the offshore Panamian companies owned by OPM Chief of Staff Keith Schembri and Tourism Minister Konrad Mizzi, leaked emails obtained by German paper Süddeutsche Zeitung, and published by Times of Malta as part of the Daphne Project show.

A consortium of 18 news organisations are pursuing the stories that had been followed by slain journalist Daphne Caruana Galizia, and will be publishing the work. The news organisations include the New York Times, The Guardian, and Süddeutsche Zeitung, the newspaper behind the Panama Papers revelations. The project (dubbed the Daphne Project) was organised by an investigative non-profit organisation called Forbidden Stories.

Keith Schembri, in reaction to the news story, said that 17 Black never became clients of his business group.

The news reports allege that investigators from the FIAU had found that 17 Black received a payment totalling $1.4 million (€1.1 million) from a Seychelles company called Mayor Trans (which reports say is owned by an Azerbaijani national).

The Daphne Project news report reads that this sum was sent to 17 Black in November 2015, through a recently closed Latvian Bank called ABLV.

The news report read that the FIAU found the transaction to be suspicious due to the appeared involvement of shell companies in risky jurisdictions. The Daphne Project reports also read that the payment was listed as being for advisory services.

The Daphne Project journalists report that a further $200,000 was sent to 17 Black from Orion Engineering, a company owned by Mario Pullicino - the agent for the FSU which feeds into the new power station. The news reports read that Pullicino did not want to add anything to his previous statements, denying that Orion Engineering was involved in any kickbacks linked to the FSU.

 

The FIAU report

A 120 page report into Minister Konrad Mizzi’s dealings was leaked before it was finalised. The Daphne Project news reports read that the FIAU said in the report, that the information available at the time made it sufficient to conclude that a reasonable suspicion of money laundering and/or the existence of proceeds of crime exists. The report was presented by PN MEP David Casa to a magistrate.

 

Bahamas accounts

According to emails obtained by Daphne Project Journalists, MacBridge and Ltd and 17 Black were to be the main target clients for Tillgate and Hearnville.

Under main suppliers the following is written: For the recycling business, the main suppliers will be printers in mainland Europe. In relation to the other areas in particular infrastructure projects it will engage EPC contractors.

The emails also say: “it is estimated that the companies will generate around US$ 2m within a year.”

In the emails Nexia BT attempted to open bank accounts in the Bahamas through Mossack Fonseca, the now non-existent Panamanian law firm.

In an email n December 17 2015, Cini told Mossack Fonseca that the Panama companies would operate in the maritime and fisheries sector in Bangladesh, tourism in Asia, infrastructure projects in African countries, Indian and the subcontinent, as well as recycling and remote gaming. 

Cini’s email indicated that the bank accounts would receive a $100,000 initial deposit, from past profits as well as retained earnings from existing appointments and business.

Attempts to open bank accounts for the companies were stopped in 2016, and the companies were since shut down.

Schembri, Mizzi denial

In a statement issued by the Department of Information, Keith Schembri said: “17 Black and MacBridge were included in draft business plans for my business group as potential clients.

My companies make dozens of business plans such as these. However, it is a fact that neither 17 Black nor MacBridge ever became clients of my business group, and no transactions were ever recorded with these companies, or with me personally.

I have no knowledge of the transfers referred to, nor any knowledge of the alleged payment.”

In a statement, Mizzi said: “The allegations and speculations made by the Times of Malta are a repetition of unfounded allegations and speculation made prior to the June 2017 elections, and Dr Konrad Mizzi unequivocally states:

 - that there is no connection, direct or otherwise, between Dr Mizzi, his company or trust, and any entity called 17 Black;

- that the Panamanian company Hearnville Inc. held no bank account and received no money from any source.”

“Minister Konrad Mizzi recently answered questions by journalists from The Daphne Project, in a frank and open manner, and has clearly stated that he:

- does not know an Azeri national identified by them as having made a payment in favour of 17 Black;

- has no knowledge of a payment allegedly made by “Orion Engineering Group” to 17 Black.”

“An independent audit into Dr Mizzi’s trust and company structure was completed by an international audit firm which issued its opinion that the financial statements of the structure were presented fairly, in all material respects and in accordance with accounting policies. The auditors have confirmed that the evidence that they have obtained was sufficient and appropriate to provide a basis for their audit opinion. The audited financial statements speak for themselves. All the facts are contained therein. They confirm that the structure is solely intended as a family trust, that there have been no trading activities undertaken by both Rotorua Trust and its fully owned subsidiary Hearnville Inc. and that no bank accounts were held by the trust and company,” the statement said.