An associate of Joseph Muscat has been indicted in Cyprus over alleged corruption in the country’s ‘golden passports’ scheme.

Jing Wang, whose Maltese company hired the ex-prime minister as a consultant on passport and residency visa schemes, is named as a defendant in a corruption case involving ex-Cypriot minister Marios Demetriades.

Payments to Muscat by Wang’s company have separately been flagged in Malta as “suspicious” due to the “vague” nature of the consultancy agreement.

Wang is the owner of a worldwide ‘global investment’ company called Delsk.

In Malta, it specialises in selling the island’s ‘golden visas’ scheme to wealthy Chinese nationals via its licensed local agents Destination Europe.

The scheme grants applicants a residency permit in Malta and visa-free travel across the EU.

Destination Europe’s director and shareholder Josef Friedrich Santin and Delsk Cyprus are among those facing charges in the corruption case.

All decisions on residency applications submitted by Destination Europe have been placed on hold until the circumstances of the Cyprus case “are clarified,” a spokesperson for the residency scheme’s regulator told Times of Malta on Friday.

“We are closely monitoring this matter and will take appropriate action as necessary, as we have done in the past,” the Residency Malta agency spokesperson said.

Muscat’s lawyer Charlon Gouder is registered as the licensed agent for Destination Europe.

The  Residency Malta agency spokesperson said decisions about the licensing of agents are made by its sister agency Community Malta.

A Destination Europe spokesperson said the company has no connection with the Cyprus case.

“The company does not operate in Cyprus, does not handle passport matters, and does not engage in any business activities in Cyprus.”

Muscat too distanced himself from the case, saying he has no business relationship with and never carried out work in Cyprus or for the Cyprus-based companies in question.

“Additionally, I have no visibility about this case.”

The former prime minister is facing his own corruption charges in Malta over a “fraudulent” hospital privatisation deal overseen by his government.

What is the case about?

Former transport minister Marios Demetriades has been indicted for corruption, bribery and money laundering in the Cypriot ‘golden passports’ scheme.

He has denied wrongdoing.

Cyprus terminated its passports scheme in November 2020 amid allegations of foul play.

Malta, which runs a similar scheme, is facing legal action by the European Commission to end it.

Wang and a relative of Demetriades are alleged to have presented “fake invoices” to a Cypriot bank to justify a €3.6 million transaction to JWPegasus, a Cypriot company owned by Wang.

Cypriot prosecutors allege JWPegasus benefitted from a €2.5 million payment after Demetriades agreed to help speed up the citizenship application of a Chinese national.

The alleged offences pre-date Muscat’s time as a consultant for Wang’s Maltese company.

A copy of the indictment was obtained by the Cyprus Investigative Reporting Network (CIReN) and shared with Times of Malta.

A spokesperson for Wang denied wrongdoing, saying there was nothing unlawful about the €3.6 million transfer which took place between two companies he owns.

“He will contest the charges in court, as will Delsk Cyprus, which has been the target of malicious attacks from other business competitors. He maintains a high regard for and has full confidence in the Cypriot judicial system,” Wang’s spokesperson told Times of Malta.

What are Wang’s links to Muscat?

JWP Malta, a Maltese company owned by Wang, hired Muscat as its ‘consultant’ in December 2020, on a €5,900-monthly contract.

Muscat resigned as prime minister in January 2020.

A copy of the consultancy contract obtained by Times of Malta shows Muscat was hired to “oversee the monitoring and developments in residency and citizenship programme worldwide” and to assist in “engagement with the relevant authorities”.

Financial documents reviewed by Times of Malta show payments by Wang’s company to Muscat were flagged as “suspicious” by a Maltese payment provider.

The provider raised red flags about the “vague” nature of Muscat’s contract with JWP Malta and the “relevance” of his skills to the consultancy assignment.

Concerns were also raised by JWP Malta’s payment provider that Muscat could “leverage” his relationships with government officials to “influence” the citizenship and residency programmes in Malta.

Payment providers are legally bound to report financial transactions they view as being “suspicious” to the FIAU, Malta’s anti-money laundering body.

Police investigators are understood to have “intelligence” on Delsk’s and Wang’s activities in Malta and the payments to Muscat.

In e-mailed comments, Muscat said he has no access to the “internal bank documents” mentioned by Times of Malta.

“I am aware that as a politically exposed person I am under enhanced scrutiny but this has never discouraged me from using banking facilities in Malta. I am certain that your kind and assiduous attention to my affairs pushes compliance departments to make comments as those you quoted.

“Nevertheless, it is quite contradictory on one hand to question the relevance of my skills and on the other to say that I could exert influence. Surely, they could not have commented that my wife was a lobbyist while I was prime minister,” Muscat said.

Wang’s spokesperson said Muscat played a crucial role in the company’s growth and marketing strategies in Asia.

The spokesperson said Muscat has been working with their Malta office since 2020, focusing on promoting the country’s residence programme in its target markets and providing analysis on the Maltese economy, real estate market and opportunities.

“We approached Dr Muscat for his expertise regarding Europe, and he has proven to be a valuable asset for the company’s growth. 

“We have confidence in our operations and the services provided by our advisers, making us one of the main sources of revenue for the Maltese government through this programme,” the spokesperson said.

‘Probe Muscat accounts’

A magisterial inquiry into the hospitals deal by Muscat’s government recommended an investigation into payments he received since resigning as prime minister, for any links with “projects/grants/loans/permissions” given to companies during his in government.

Industry sources said Wang and his representatives had long lobbied Muscat’s government to terminate a 2016 contract it gave to a rival company, Shanghai Overseas Chinese Exit-Entry Services, which offered exclusive rights to market and operate Malta’s residency scheme in the Chinese market.

The exclusivity agreement meant rival companies like Wang’s had to pay Shanghai Overseas a €10,000 cut on every Chinese Delsk client who applied for residency.

The exclusivity agreement with Shanghai Overseas Chinese Exit-Entry Services ended in 2021.

Muscat said he was “never lobbied by anyone in connection with the contract”.

One industry insider said Wang was “extremely pissed off” at having to pay Shanghai Overseas a cut on every visa application “for doing f**k all”.

The industry insider said many wealthy Chinese applicants use the residency scheme as a “Plan B,” in case they are forced to flee China.

It also offers them visa-free travel through the rest of the EU.

“It was easy money for the providers, and for everyone else. People were renting properties, renting summer residences to these Chinese and could still continue using them themselves, as the Chinese weren’t ever in Malta,” the insider said.

Data obtained by the Daphne Caruana Galizia Foundation indicates Wang’s local agent handled just under half of all visa applications by Chinese nationals between 2016 and 2021.

At the time, Wang’s local representative was Mark Hyzler, the son of former standards commissioner George Hyzler.

Hyzler distanced himself from Wang’s indictment in Cyprus when contacted by Times of Malta.

He said he has never represented Wang or Delsk in Cyprus and has absolutely no involvement or knowledge of his/its operations there.

“Likewise, I have never had anything to do with the engagement or otherwise of any consultant engaged by Mr Wang, be it Dr Joseph Muscat or any other consultant, for that matter.”

Hyzler said in the past, he acted as an accredited agent for clients introduced to him by Delsk.

“My engagement ended on the termination of the Malta Residency Visa Programme. Today I continue to represent clients that had been approved under the previous programme.

“Delsk now makes use of the services of other accredited agents under the new residence and visa programmes.”

Passport application rejected

Documents obtained by Times of Malta show Wang attempted to buy a Maltese passport in 2015, under the government citizenship scheme.

Wang’s passport application, which was handled by Hyzler, was “refused”.

Applications are sometimes refused when the authorities uncover potentially negative information on the applicant during the due diligence process.

The exact reasons for the refusal are not known.

Wang’s spokesperson dismissed questions by Times of Malta about his “personal life”.

“We can only say that your questions confirm that Mr Wang and our companies play by the rules,” the spokesperson said.

Muscat in turn said if Wang was refused a citizenship application, this only confirms the integrity of the Individual Investor Programme.

Public records show Wang went on to obtain a Cypriot passport.

Kyriakos Pieridis (CIReN) contributed to the reporting.

This article was produced with support from OCCRP and the Daphne Caruana Galizia Foundation.