GUEST POST/What, exactly, is Konrad Mizzi going to declare?

Sent in by Rumplestiltskin:

Joseph Muscat has said that he has no problem with Konrad Muscat registering a company in Panama and then hiding it in a trust in New Zealand, “since he will be declaring it in the declaration of assets that Ministers are duty bound to submit to Parliament.”

However, this begs the question: what exactly is Konrad Mizzi going to declare? That he is the settlor of a trust in New Zealand? By its very nature a trust is a vehicle that removes the ownership of the assets from the settlor. Moreover, the trust beneficiaries are his wife and children, so, thanks to the conveniently recently changed rules, he might not even have to declare it at all. Will he declare that he owns a company registered in Panama? But then even the company is now owned by the trust, and so is no longer technically his.

Let us be generous and say that Mizzi declares that he is the (former) owner of the Panamanian company that is in turn owned by the trust, and that he even tells us the assets owned by the company. He has already said that the company has no assets. There is one catch to all this.

Because the company is registered in Panama, which does not divulge any information, there is no way of knowing whether the assets declared reflect reality or not. Mizzi wants us simply to ‘trust him’ that he will be revealing all. But if he is revealing all, why set up the company in Panama, a state blacklisted by the EU, and renowned as a preferred jurisdiction to hide dirty money? Why not set it up in a well-governed EU country, where anything he declares can be proven – like Malta, where he is a government minister? Why then set up the trust in New Zealand, when Malta offers trust facilities for legitimate estate planning purposes?

Presumably, Mizzi will also be declaring the source of the future assets – with which he anticipates “populating” his Panamanian company – to the Commissioner of Revenue in Malta. However, if the Commissioner becomes concerned about assets in a Panama company, there would be no way he could order an audit because Panama does not cooperate with tax authorities.

Again, the Commissioner for Revenue would simply have to trust Konrad Mizzi, because, after all, he is an honourable man.

There are way too many questions in this mess that is dragging Malta’s name into the gutter. Even if there is nothing untoward in all of the above, but just questions, Muscat’s only honourable option was to drop Mizzi like a hot potato once this thing broke. Unfortunately, he not only failed to do that, but, following a pattern that is now becoming all too common, he rewarded him instead by overtly and strongly backing him to become deputy leader of the Labour Party in the thick of it, so creating more questions about his own involvement in this sorry state of affairs.