A European Parliament report says two top Maltese officials should be removed and brought to justice for alleged money laundering, saying their continued presence in the government fuels the perception of impunity on the Mediterranean island.
The report from a European Parliamentary commission of inquiry into allegations of money laundering and tax evasion in Malta didn't name the officials. But it clearly was referring to Tourism Minister Konrad Mizzi and the premier's chief of staff, Keith Schembri.
Continue Reading Below
Mizzi and Schembri were named in the Panama Papers in 2016 as having secretly opened companies in Panama. Both admitted to opening companies but denied laundering money.
They haven't responded to Thursday's report, which said that "keeping them in office affects the credibility of the government, fuels the perception of immunity and may result in further damage to state interests by enabling the continuation of criminal activity."
Both Mizzi and Schembri retained their jobs after the June 2017 election called by Prime Minister Joseph Muscat a year ahead of schedule after it was revealed that Muscat's wife was also an owner of a company in Panama.
The Muscats deny the allegation. A magisterial investigation launched in April last year has yet to be concluded.
The report was drawn up by a parliamentary committee investigating allegations that Malta contravenes and misapplies European Union laws concerning money laundering, tax avoidance and tax evasion. A fact-finding mission, led by Socialist lawmaker Ana Gomes, was sent to Malta late last year after the Oct. 16 car bomb slaying of journalist Daphne Caruana Galizia, who had reported on wrongdoing by Malta's elite.
The parliamentarians expressed serious concerns about what it called Malta's "unclear separation of powers" as well as its "weak" implementation of anti-money laundering legislation and the "serious problems" in a program allowing people to buy Maltese citizenship.
The Maltese government has so far refused to publish the names or nationalities of the people who have paid 650,000 euros ($792,000) apiece to be granted Maltese citizenship. Because of Malta's EU membership, that automatically grants them EU citizenship, a very valuable commodity.
The report urged the government to publish the list of foreigners granted citizenship under the program, and said the European Commission should assess the program to see if it has distorted European markets or EU security.
On the banking front, the report flagged the low rate of banking investigations and called on the European Banking Authority and the European Central Bank to assess whether Maltese authorities were "fully equipped and free from conflicts of interest" to perform their duties.
The report also requested the European Commission take note of practices used against the Maltese media, including Strategic Lawsuits Against Public Participation, which aim to intimidate and silence media by burdening them with high legal costs. Most media in Malta have been hit by such suits, which may be winnable in court but at a prohibitively high cost.
The report called for Malta to "actively ensure the protection of media freedom" by drawing up laws to "curtail these abusive practices."