Everything above board and in
good faith - Parmalat Malta director
- MFSA has been examining accounts from day one
By Julian Manduca
Dr Ian Stafrace, a director in all three Parmalat owned companies in
Malta, yesterday told The Malta Financial and Business Times that since
the Parmalat companies came to Malta, everything was "above board,
and conducted in good faith."
Stafrace explained that the international media was wrong to put Malta
and the Parmalat companies in Malta in a bad light, since the transactions
they refer to were effected prior to the companies registration
in Malta in April 2002.
Over past weeks various sections of the international media have suggested
that missing Parmalat funds have ended up in Malta.
Stafrace said that reports appearing in some media, including the Italian
magazine Panorama, were incorrect and he is reserving the right to take
legal action in this regard.
One of the wrong impressions created was that soon after the Parmalat
Capital Finance Limited came to Malta, it acquired Bonlat Financing
Corporation, the company that held the US$5 billion that was supposedly
at the Bank of America that sparked off the entire Parmalat scandal.
Stafrace pointed out that as could be seen in the accounts, Bonlat was
already a subsidiary on PCFL in 2001.
In another report, according to Italian news agency ANSA, it was stated
that investigators have been trying to trace Eur250 million (Lm109 million)
which had disappeared from Parmalat funds and were believed to have
ended up in a bank account in Malta.
It was reported that the money had been raised from a bond issue of
a Brazilian company owned by the Italian food giant.
The funds had been deposited with a Cayman Islands unit
of Spanish bank Santander Central Hispano and served as a guarantee
for a loan made to a Dutch unit of Parmalat.
According to ANSA, however, at one point in time in 2001, this money
disappeared, only to be traced during the past few days to Malta, after
the Italian authorities had requested and were given information by
Santander Central Hispano and unnamed banks in Malta. The Malta Financial
and Business Times asked HSBC, Parmalats bankers in Malta whether
it was aware of such funds, but at the time of going to press no reply
was received. However, the Parmalat group had no companies in Malta
in 2001 and all were set up in 2002.
Italian magazine Panorama has also reported that its journalists visited
the countries where Parmalat had subsidiaries, and a certain Roberto
Seghetti was detailed to Malta.
Seghetti, however, returned home empty handed after speaking to Dr Stafrace
and Andrew Manduca, the senior partner of Deloitte and Touche, and auditors
of the Parmalat companies registered in Malta. The person in charge
of the audit of the Parmalat companies is Edward Camilleri.
The Malta Financial and Business Times asked Camilleri several questions
related to the Parmalat accounts, but Camilleri said he would not be
able to reply before today.
When The Malta Financial and Business Times asked Stafrace whether money
was transferred from the Maltese companies to other Parmalat related
companies, Stafrace said he could not divulge information that was not
public, but added that the transactions that took place in 2002 were
recorded in the accounts which are public. Asked whether any official
investigations had started in Malta, Stafrace said that, up to this
point, he was not aware of any.
He told The Malta Financial and Business Times that when the Parmalat
companies were registered Malta in April 2002 the company was highly
rated and there was nothing to suggest any wrongdoing.
Noose tightens on milked
Prosecutors and investigators in Italy are turning up the heat on Parmalats
former finance chief and former director of Parmalats Malta companies
Fautso Tonna. Tonna was grilled for 11 hours and taken from prison to
the prosecutors office in Parma.
Accounting firms, banks and US banking giant Citigroup Inc are also
finding themselves in the line of fire. Tonna stands accused of helping
to devise an intricate web of offshore companies to hold fake accounts
and non-existent assets for over a decade.
According to Panorama, Parmalat would loan money from one bank and place
it in a bank in another country. On the strength of the deposit it would
raise a loan from the second bank and created a daisy-chain of loans
with monies criss-crossing across related companies and subsidiaries.
The intricate web somehow managed to escape the notice of regulators.
Tonna claims he followed instructions of Parmalats founder and
owner Calisto Tanzi.
Tanzi has admitted to diverting 500 million Euros from the 260 or so
Parmalat related companies to Tanzi family funds but claims he is unaware
of how this came about.
Prosecutors and investigators are still looking for anything between
10 and 13 billion Euros which have gone missing from Parmalats
In the US a pension fund has started a lawsuit against Citigroup and
audit firms Deloitte & Touche Tohmatsu and Grant Thornton, besides
Parmalat and is one of the first brought by US investors in Parmalat
Parmalats bonds are now trading at about 20 percent of face value
and its nearly worthless stock is suspended indefinitely.
MFSA confirms dubious transactions before Malta
MFSA confirms dubious transactions
The Malta Financial
and Business Times yesterday contacted The Malta Financial Services
Authority chairman Prof Joe Bannister to enquire as to whether the accounts
of the Parmalat owned companies in Malta had been scrutinised.
Bannister said, "The MFSA started its examination of the Parmalat
presence in Malta as soon as the first articles started appearing in
the foreign press early last December and it immediately took action
to draw up a picture of the situation.
"The MFSA has been updating its findings practically on a daily
basis as new facts are uncovered and as new developments are reported.
It has carried out and is carrying out its investigations with the seriousness
warranted by the importance of this case and these investigations are
being handled at the very highest level within the Authority."
Bannister, like Stafrace, suggested that many transactions being bandied
about in the media related to Malta did not in fact have anything to
do with the companies since they have been registered on the Islands.
"I wish to confirm that - on the basis of the information available
to the MFSA to date - it results that the substantial transactions being
mentioned in the international media were carried out before the Parmalat
group started to establish a presence in Malta.
"The company known as Bonlat, where a serious forgery of a bank
statement is alleged to have occurred, is not a Maltese company, but
was set up in the Cayman Islands. The forgery too pre-dated the Group's
presence in Malta."
Asked if MFSA has looked closely or investigated certain figures in
the 2002 accounts of Parmalat Capital Finance Ltd including the USD158,367,848
due to a loss on currency exchange, and the low value of the investment
in the wholly owned subsidiary Bonlat: US$2 Bannister said:
"The documents relating to all these companies, including where
applicable the audited accounts are available for public scrutiny. At
law, it is not and it cannot be the Registrar of Companies' function
to second-guess the financial statements filed each year by the 25,000
or so active companies registered in Malta. Financial statements remain
the responsibility of the directors and of the duly authorised auditors."
Asked whether the stories in the international media were affecting
Maltas reputation and implying Malta was a tax haven Bannister
said the question was neither here nor there and added: "Malta
seeks to offer a variety of advantages including its EU compatible company
law framework which since 1965 has followed the UK company law model."