Malta National Orchestra backer got €8m from ‘anonymous’ financier

A big spending backer of Malta’s national orchestra was investigated by the authorities over €8 million in donations from an “anonymous” financier, Times of Malta can reveal.

The probe into the European Foundation for Support of Culture (EUFSC) was triggered several years ago by a former top government official, who, at the time, sat on Malta’s national coordinating committee to fight money laundering. Times of Malta understands that the authorities struggled to establish who the ultimate financier of the foundation was, making it difficult to take the investigation forward.

The foundation was set up in 2015 and soon embedded itself in Malta’s cultural sector, thanks in no small part to the millions of euros pumped into it by the mystery financier. In 2019, the foundation’s president, Konstantin Ishkhanov, was even given the Malta Arts Council’s top award for his “exceptional contribution to the cultural life of Malta”.

Documents reviewed by Times of Malta confirm the EUFSC, which became synonymous for its backing of Malta’s national orchestra, was funded by millions of euros in “donations” anonymously received from the US-based National Philanthropic Trust (NPT). The trust allows donors to make completely anonymous contributions to non-profit organisations like the EUFSC.

A spokesperson for the US trust declined to tell Times of Malta who was behind the donations. “As per NPT’s policy, the organisation does not disclose the names of its donors who have recommended grants to charities using their donor-advised funds,” the spokesperson said.

Questions sent to the EUFSC and Ishkhanov about the ultimate source of these funds were not answered at the time of writing.

Satabank account

Financial records seen by Times of Malta show the foundation received €8.7 million from the trust between 2017 and 2018, via an account held at Satabank.

Satabank, which was shuttered by the authorities in 2018 over money laundering concerns, had flagged how the amount of money flowing into the foundation’s accounts was far higher than the foundation’s expected annual turnover when the account was first opened.

Documents collected by the bank only indicated that the payments from the trust were an “unrestricted gift” and the ultimate donor was not named. These anonymous donations formed the bulk of the foundation’s income, financial records indicate.

Further concerns about the foundation were raised within the regulator for voluntary organisations about the way it carried out transactions in “high-risk” jurisdictions.

Voluntary Organisation Commissioner Jesmond Saliba told Times of Malta that his office “constantly screens organisations and administrators to ensure that all operations and management of such organisations are always in accordance with the law”. Such monitoring, he pointed out, is carried out on the commissioner’s initiative or when a complaint is lodged with his office.

Saliba said that, although the law precludes him from providing information about specific complaints made to his office about voluntary organisations, he can confirm that, as is the case with other voluntary organisations, all information received and related findings was passed to the relevant authorities as per procedure.

The foundation became synonymous with the national orchestra, supporting glitzy events and tours of the US and Europe.

Russia links

In 2018, the foundation was behind the Crystal Palace ballet staged at Moscow’s state Kremlin Palace in 2018. The ballet production was premiered in Malta as part of an event featuring the national orchestra to celebrate the 50th anniversary of Malta-Russia diplomatic relations.

The EUFSC’s offices used to be based at the Russian Cultural Centre, in Valletta, which is part of a network of offices across the globe run by Rossotrudnichestvo, a cultural exchange agency. Rossotrudnichestvo has reportedly used its cultural network as cover for Russian intelligence officers looking to operate abroad.

Apart from the EUFSC, Ishkhanov, a graduate of the Gubkin Russian State University of Oil and Gas, was also involved in the Maltese-Russian Friendship Foundation.

In 2020, then culture minister José Herrera had temporarily suspended the orchestra’s activities with the EUFSC, pending a due diligence report into the origins of its funds. The due diligence report was never published and Herrera greenlit the orchestra’s continued association with the foundation.

Then national orchestra CEO Sigmund Mifsud had vigorously defended the orchestra’s ties with the foundation and downplayed its links with Russia.

In 2024, the orchestra was accused of seeing itself as being “above the law” over its refusal to cooperate with an investigation by the data commissioner over its failure to hand over details of its agreements with the foundation to Times of Malta.

The orchestra eventually gave Times of Malta the documents and said it had cut ties with the foundation at the end of 2022, a time frame coinciding with Mifsud’s resignation. Since then, the foundation appears to have faded away from the local scene. Its last post on its previously active Facebook page dates back to November 2022.

Financial records indicate that its multimillion-euro source of anonymous donations appears to have dried up. Between 2022 and 2023, the foundation’s income from donations and sponsorships slumped from €1.3 million to €230,000. The following year, the foundation recorded zero income in its books.

Its financial records show the foundation’s presence in Malta has been drastically reduced. It did not declare any operating expenses in its 2024 accounts nor any salary payments to employees.