Malta is expected to feature prominently in next month’s trial of former Italian prime minister Silvio Berlusconi, the charismatic media mogul who faces trial over allegations of tax fraud, embezzlement, false accounting and money laundering in Milan’s courts.
The Italian authorities are charging that Berlusconi, through his corporate lawyer David Mills, set up a web of offshore companies that were used in a complex tax evasion operation. At least six of these companies were registered in Malta.
The Italian authorities are also alleging that when the investigations began, Mills shipped several boxes of sensitive financial documents to Malta.
The scheme involved using the web of offshore companies to purchase American television and cinema rights, which were then resold at inflated prices to Mediaset in order to avoid paying Italian taxes.
The offshore companies are also alleged to have been used to help Berlusconi avoid Italian media monopoly rules.
The offshore companies were held by Fininvest, Berlusconi’s main holding company, for which Mills provided financial and legal services. Mills will stand trial alongside Berlusconi next month in what is expected to be a media frenzy worthy of the flamboyant former Italian premier’s antics.
Both have denied any wrongdoing and Berlusconi, on his part, claims he has been victimised by politically biased left-wing judges.
Berlusconi himself has stood before the Italian courts on at least six different occasions on corruption charges. On the three occasions he was found guilty, his convictions were either dismissed on appeal or declared void on technicalities.
A report drawn up by the Italian authorities in Milan tells how in April 1996 Mills had been served with an order from the UK’s Serious Fraud Office to hand over the Fininvest files, and describes how boxes of files had been shipped to Malta, from where they have still not been recovered.
The report also warns “there is good reason to suspect that Mills and his clients will take steps to keep relevant evidence out of the hands of investigators”.
The report also details how Mills had mislead investigators by hiding evidence and accuses Mills of making false claims to the authorities about the location of the missing files. The report describes how he handed over useless files while secreting away those demanded by the investigative authorities.
A large cache of the requested documents was eventually discovered in a London warehouse but dozens of boxes of similar files are still being sought by authorities, many of which they believe have been stashed away in Malta.
The Italian courts are also seeking to bring bribery charges against Berlusconi and Mills in relation to a previous case, in which Mills is accused of accepting a Lm225,000 bribe for giving false testimony beneficial to Berlusconi in a previous case.
It was later shown that the funds from the alleged bribe were used to settle the mortgage on a house owned by Mills and his wife, British Culture Secretary Tessa Jowell. The scandal had exploded in the British press earlier this year, which led to the couple’s separation and the north London house being put up for sale.