Mrs Cassar, managing director of a development company, took the stand yesterday to testify in the case against private investigator Joseph Zahra. The 50-year old is being accused of falsely giving the impression of incriminating evidence, making false and defamatory accusations against third parties, filing a false report, and circulating unfounded, alarming rumours. The witness was one of the people Mr Zahra allegedly accused of corruption regarding the equipment tender.

At an earlier sitting, the court heard Assistant Commissioner Michael Cassar say that Mr Zahra had drawn up a report for Simed containing serious allegations of corruption regarding the equipment tender of the Mater Dei.

Simed is a Dutch company that was chosen as the preferred bidder for the equipment tender of the Mater Dei Hospital, but in the final stages of the process, the tender was awarded to Inso, an Italian consortium, represented in Malta by Professor Ian Refalo.

The report, drawn up by the accused and eventually passed on to Prime Minister Lawrence Gonzi, implicated three people in the suspected corruption: Mr Spiteri, his daughter who testified at yesterday’s sitting and former minister John Dalli’s brother Bastjan.

AC Cassar stepped in the prosecution’s role yesterday and asked Mrs Cassar whether she knew Mr Dalli. The witness said she only met the man at the interrogations regarding the case against Mr Zahra.

In the report, drawn up as part of the investigation for Simed, Mr Zahra listed a number of meetings Mrs Cassar, Mr Spiteri and Mr Dalli allegedly had with Inso director of operations Marco Fontanelli and other officials in Naples and Florence.

The report also mentioned phone calls made by these three people and Mr Zahra claimed he had heard the recordings of these phone calls through his contacts in the Italian Secret Service.

Mrs Cassar was asked whether she knew Mr Fontanelli or any of the other Inso officials. She said she had no idea who these people were, let alone contact them or hold meetings with them in Naples.

The witness then gave a detailed list of her travels abroad over the last two years. She said she went to Naples on 26 October 2002, but was definitely in Malta in November of that year and in March 2003.

The case continues.