In a reply to a rule of law report penned by MEPs following the brutal murder of journalist Daphne Caruana Galizia, the government said that “investigation orders are highly intrusive and it is for that reason that they are only granted by the court and only in circumstances where the threshold of reasonable cause has been met”.

Caruana Galizia was murdered on 16 October 2017, prompting a delegation of MEPs from the European Parliament (EP) to embark on a mission and investigate the rule of law in Malta.

A delegation of MEPs penned a report which ultimately called for investigations into a number of persons and entities involved in the Panama Papers scandal, criticised the police for a lack of investigations and harshly criticised the Attorney General for failing to launch investigations following serious allegations of money laundering and kickbacks by top government officials.

Minister Konrad Mizzi and the PM’s chief of staff were, in 2016, caught out with secret Panama companies sheltered by a New Zealand trust. The following year, Caruana Galizia alleged that the third Panama company named in connection with Mizzi and Schembri belongs to the PM’s wife, Michelle Muscat, and that she had received illicit funds.

All have denied wrongdoing but the allegations led to a snap election one year ahead of schedule.

Police never investigated the allegations made. It took a combination of former PN leader Simon Busuttil to set up magisterial inquiries in motion, while the PM requested for a separate magisterial inquiry to be launched to clear his and his wife’s name. In the course of the allegations, numerous FIAU reports were leaked to the media showing that there were concerns of wrongdoing by Mizzi and Schembri in various forms. The FIAU claimed that the reports were not conclusive however the media publications prompted the public to question why no investigations were launched by the police.

In an official government reply sent to the delegation which penned the report, the government focused on a number of key elements, mainly that MEPs showed a lack of understanding in the way institutions work, that some statements were factually incorrect and that the delegation ignored many reforms brought into place by this government.

In defence of the AG and his perceived inaction in the face of mounting allegations, the government pointed out that he is restricted by parameters laid out in the law. The law was quoted where it said that the AG is empowered to ask for an investigation order after he has “reasonable cause” to suspect that a person is “guilty” of breaching money laundering legislation.

This, the government stressed, meant that usually when the AG requests an investigation order, police investigations are already at an “advanced” stage so that the material found and the reasonable suspicion of guilt maybe exhibited to the court.

“An investigation order is for the collection of material evidence; it is not an order to request the police to initiate an investigation. A police investigation would ordinarily be in progress before an investigation order is requested. Contrary to the suggestion in the Mission Report, the Attorney General has no power at all to 'press charges' nor to require the police to investigate alleged crimes.”

Government went on to point out criticism of the AG for not approaching the court for an investigation order “on the back of various news articles alleging money laundering by Politically Exposed Persons [PEPs].

“Investigation orders are highly intrusive and it is for that reason that they are only granted by the court and only in circumstances where the threshold of reasonable cause has been met. Therefore, the AG will only make a request for an investigation order on the basis of a dossier of evidence, and not mere media reports.

“It is worth noting that media reports may spark a police investigation into an individual or organisation, but as set out above, such an investigation is not instigated by the AG or via an investigation order”.

Jarring with the government reply pointing towards a need for police investigations before the AG may ask for an investigation order, is the rule of law report itself where MEPs describe statements made by the Police Commissioner.

 “The Police Commissioner confirmed to Members that several FIAU reports were sent to the police and registered (under the same file number) but no investigation was started. Given the fact that the Police Commissioner is directly appointed by the Prime Minister..” MEPs wrote in the report. 

In addition, another statement by the commissioner was included where he said that no investigations were carried out because the police lacked the resources and expertise to investigate such crimes.

In the government’s reply to the MEP report, it suggests that “there were not sufficient grounds to suspect criminal activity” and that an investigation would have “clearly been a waste of police resources.” 

Government's reply in full

Government response to rule of law mission report is laughable - David Casa 

In reaction to the government's reply, Partit Nazzjonalista Head of Delegation MEP David Casa stated: 

“The government’s attempt to justify the failings found in the Mission Report is a joke. The author must be hoping MEPs do not have access to the internet and basic analytical skills”. 

The Mission Report issued by MEPs investigating the rule of law in Malta called for Konrad Mizzi and Keith Schembri to be removed from public office, investigated and brought to justice. 

The document issued by the Government suggests that no action whatsoever was taken by the Police because “there were not sufficient grounds to suspect criminal activity” and that an investigation would have “clearly been a waste of police resources”. 

“The attempt to belittle the relevance of FIAU reports on the basis of which magisterial inquiries are currently ongoing is outrageous.  This document is an embarrassment. MEPs have followed the Panama Papers and read the FIAU reports. Providing such pathetic explanations will only be counterproductive”, stated Casa.  

The Government response also states the Government has doubts as to legality of the ad-hoc delegation and “reserves all and any rights in this respect.

“Any attempt to undermine the work being done by democratically elected Members from all political groups in the European Parliament is misguided and contemptible," Casa said.

Government's response fails to address the key question - Sven Giegold

Greens MEP Sven Giegold told The Malta Independent that government's response fails to address the key question.

He welcomed that government has finally given a response, but said that the response lacks any coherence, as it does not respond to the key recommendations or key issues the MEPs raised.

He mentioned that he is open to discuss whether the MEPs misunderstood certain things, but stressed that "the response lacks a political response to the key question - is there a culture of impunity in Malta when it comes to corruption and high level cases of financial crime?"

He said that this is the core question of the mission, and that it is not answered. He mentioned the low level of prosecutions in this field.

"They (government) are answering the questions they like to answer, but they do not respond to the key question we raised with regards to the rule of law, and this is very unfortunate. The government reaction should at least respond to all the recommendations of the Parliamentary mission, and they do not do that."

He said that government discounted certain issues. "Whether the delegation fully understood the institutional setup in Malta, we can discuss," he said, but stressed that the recommendations should be responded to.

"They raise issues which are not the core of the report. They try to show that we misunderstood things, which may or may not be the case, and we will of course continue with the dialogue, but the key recommendations and issues are simply avoided in the response."

"The people of Malta deserve a proper answer to what Parliament has recommended."