The Malta Independent 28 May 2023, Sunday
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Heated debate between PM and PN Leader ends as proof remains scarce

Helena Grech Friday, 21 April 2017, 20:25 Last update: about 7 years ago

Prime Minister Joseph Muscat has fended off accusations about his wife being the owner of Panamanian company Egrant Inc. by calling a reproduction of the declaration of trust which names Michelle Muscat as the ultimate beneficial owner, “fabricated”.

The two mainstream party leaders faced-off in a heated debate yesterday evening on popular current affairs programme Xarabank, to address allegations made by journalist and blogger Daphne Caruana Galizia.


On Thursday evening, she alleged that the owner of Egrant Inc is the Prime Minister’s wife Michelle Muscat, and that the company received US$1.017 million from the daughter of the Azerbaijani president Leyla Aliyeva, through her Dubai company. She alleged the transaction was facilitated through Pilatus Bank of Ta’ Xbiex, Malta.

Shortly before the programme started, the controversial blogger uploaded a text on her personal blog which she claims to be two declarations of trusts showing that shares in Egrant Inc are held by Mossack Fonseca nominees for “Mrs Michelle Muscat”, also providing her date of birth, 16/05/1974.

It must be said that this is not a screen shot of the alleged documents, but an alleged copy and paste of the text. Prime Minister Joseph Muscat and his wife have vehemently denied these claims, called for authentic proof, and have described the allegation as a "frame-up".

The Prime Minister repeatedly challenged the PN leader to endorse the text uploaded by Mrs Caruana Galizia. Dr Busuttil hit back by asking: "how is anybody expected to believe you after the way you tried to deny the Panama Papers scandal? Why have we never heard of the Financial Intelligence Analysis Unit investigation about the affair?” Dr Busuttil reminded the Prime Minister.

Dr Busuttil stressed the crucial fact that the police only entered Pilatus Bank hours after the allegations had been made, and that the chairman and risk manager filmed leaving the bank through an emergency door with large bags meant that the proof had been allowed to walk out the door.

Dr Muscat claimed that the police arrived at the bank “as soon as they could”.

The PN leader hit out at Dr Muscat for using his family as a shield to gain the sympathy of the public, resulting in the Prime Minister promising to stop blogger and OPM aide Glenn Bedingfield from writing about Dr Busuttil’s family as he has done so in the past.

Turning to the alleged registered dates on the text presented by Mrs Caruana Galizia, the Prime Minister argued that if the text is genuine then the August 2015 date would mean that Mrs Muscat should have been named in the Panama Papers leak, alongside Dr Mizzi and Mr Schembri. Panama Papers refers to the leak of documents exposing the dealings of Mossack Fonseca and its clients.

Dr Busuttil conceded that this was a good point, however made reference to an e-mail exchange between a Nexia BT employee and Mossack Fonseca.  "This is because the e-mail leaked was about the companies of Dr Mizzi and Mr Schembri and the third person. On Egrant, the e-mails read: ‘it [the person] will be an individual who I will speak to you about over Skype to give you the details’”.

“Who could be more important than Konrad Mizzi and Keith Schembri?" argued Dr Busuttil.    

In the text for both alleged declaration of trusts, it says that the address registered to Egrant Inc is:

“EGRANT INC., 807956S, of The Penthouse, Suite 2, Capital Business Centra, Entrance C, Triq taz-Zwejt, San Gwann, SGN3000, Malta”.

Dr Muscat argued that the text of documents uploaded by Mrs Caruana Galizia is “fake”, because Egrant Inc. is a company registered in Panama, but the registered address in the text as can be seen above, is San Gwann.

Responding personally to this claim, Mrs Caruana Galizia posted on her personal blog that the Prime Minister “knows full well that the San Gwann office address is that of Nexia BT, and at the time also Mossack Fonseca Malta.

“The address given for Egrant Inc is at Brian Tonna’s office. Brian Tonna is the one who made the arrangements for the company, and it is perfectly normal for lawyers and accountants to have client companies use their office address.”

Prime Minister Joseph Muscat argued that the bottom line is that the PN leader is making serious allegations without concrete proof, and that bank transfers of such a high amount are always accompanied by an electronic record which cannot be deleted. He said the magistrate heading the inquiry has access to such international records, and that therefore, his name will be cleared.

There was no audience during this debate. The debate blog can be found below:

22.45: The debate has ended.

22.42: Dr Busuttil said that the problems in Malta are evident when considering that Xarabank made an enormous effort to collect 2 million, "but the Prime Minister spent that much on travelling alone." He used this point to further drive home his message that Malta is mired in corruption.

The PN Leader made a renewed call for anybody who is disgusted with the current situation in Malta to stand up. "I began this fight 36,000 votes down, I feel like David versus Goliath, but what should I do Prime Minister? Should I do nothing?"

Dr Muscat asked Dr Busuttil to spend the last two minutes of the debate by providing proof of the allegations, to which Dr Busuttil said that the proof has already been explained. "What happened to the FIAU investigation into Konrad Mizzi and Keith Schembri on money laundering. We are living in a network of criminality, and the Prime Minister has a file on his desk which holds the investigation", said Dr Busuttil.

The Prime Minister refuted the claim that the proof of the allegations was allowed to walk out of Pilatus Bank, by saying that today is a day of allegations and not proof.           

"I make mistakes, some of them large. I am not perfect, but we have done a lot of good for this country. This is evident, the people feel it in their pockets, in the quality of air, from cutting poverty in half," Dr Muscat said. He called on all families to come to the 1 May celebration of the success that has been achieved in Malta.

22.22: Peppi Azzopardi confronted the Prime Minister with how the line provided to the public at the start of the Panama Papers scandal was that the story was untrue, to which Dr Muscat was quick to reply that he himself had never said that, but that Dr Mizzi and Mr Schembri's companies were declared from the beginning.

Dr Muscat said that it had been reported that there was no safe in the kitchen of Pilatus Bank, to which Peppi Azzopardi quickly reminded the PM that this could have been found to be true if the police were allowed to enter the bank immediately after the allegations surfaced.                        

The Prime Minister said that the police entered as soon as they were able to.  Dr Muscat illustrated his credibility by saying that the court case regarding Parliamentary seats was heard before a former PN candidate who is a sitting Judge.

Dr Busuttil said that the Prime Minister made a good point, by saying his wife's name was never mentioned in the Panama Papers leak. "This is because the e-mail leaked were about the companies, Konrad Mizzi and Keith Schembri. On Egrant however, it said: it will be an individual and I will speak to you over Skype to give you the details. Who could be more important than Konrad Mizzi and Keith Schembri?" argued Dr Busuttil.                       

The Prime Minister repeated his previous argument by saying that the dates listed in the text uploaded by Caruana Galizia mean that his wife's name had to be mentioned in Panama Papers. Dr Muscat alleged that on the gozo-drug-investigation case, the persons involved were in fact arraigned on drug trafficking charges.

22.10: Addressing claims that Malta's institutions have been weakened under Dr Muscat's leadership, the Prime Minister said that the PN leader praises institutions when decisions are made in his favour, and questions their credibility when things do not go his way.

The Prime Minister took the opportunity to draw attention to today's news that the number of people who were below the poverty line has reduced. He described a number of government moves that have led to concrete improvements in the peoples lives, to which Dr Busuttil showed his disgust by mentioning a number of scandals such as the gozo-drug-investigation case, where it was alleged that two government ministers interfered.

22.05: The Prime Minister promised that from today on "I will never mention your family. Do you promise to do the same?" Dr Busuttil said that he never did so. The Prime Minister accused Dr Busuttil of hiding behind blogger Daphne Caruana Galizia.     

It was stressed that the address associated with the companies of Dr Mizzi and Mr Schembri is the same one listed in Caruana Galizia's blog for Egrant Inc. Dr Muscat vehemently denied this.

22.01: The PN leader said that the Prime Minsiter missed a golden opportunity by not sending the police to seal Pilatus Bank immediately. "He didn't just lose a golden opportunity, but he allowed the chairman of the bank to enter, and take bags with him. Now he wants me to bring proof. People are not imbeciles, you made fools of them last year [Panama Papers], but you wont this time."                      

Dr Busuttil slammed the Prime Minister for using his family to shield himself and win sympathy. He reminded the Prime Minister about the Labour Party blogs sharing personal information about Dr Busuttil's sister, who was going through a difficult time.   

"You [PM] have the audacity to speak about bringing family into the limelight?".

"Your speaker [blogger and aide to the Prime Minister Glenn Bedingfield] attacked my girlfriend Kristina, and you are going to talk to me about bringing family into it?".

Dr Muscat apologised, which the PN leader called a lie. Dr Muscat said that he will not allow this to happen anymore.

21.52: The PN leader said that it is extremely disappointing how the Prime Minister has embarassed Malta. "In normal countries, when allegations like this come out institutions take action to uncover the truth. The Prime Minsiter, instead of doing the right thing, is trying to divert attention by slinging mud around".                        

Dr Busuttil referred to an e-mail which was exposed through the Panama Papers leak, showing that the ultimate beneficial owner of Egrant could not be mentioned on an e-mail, but had to be spoken about over Skype, indicating that the person is more controversial than a top government minister and the PM's chief of staff.                        

Dr Muscat said, referring to Panama Papers and the supposed transaction to his wife's company two years ago,  "why wasn't my wife's name mentioned in Panama Papers?". "Dr Busuttil will not win an election using these allegations. You have your national demonstration, we have our people on 1 May. People are seeing your character, you are worried about the opinion polls, and because you cannot progress in any way, you dropped the mother of all bombs, which has fallen in your court", said Dr Muscat.  

The two leaders got into a tit-for-tat because the PN leader mentioned four offshore companies, referring to Brian Tonna's BVI company named in Panama Papers. The Prime Minister said: "I am here tonight because the Opposition Leader has attacked my family on allegations he has repeated as fact. I am here because the Opposition Leader has mounted an attack based on lies against my family. People with cameras have been targetting my wife and children. This is not my first general election. Last general election my opponent was former PM Lawrence Gonzi, and we had a relationship of respect. Today, Dr Busuttil is acting in this way because he is desperate for power".                      

"Dr Busuttil is tarnishing my name and that of my family, and he has not produced one shred of evidence. When his friend [Caruana Galizia] provided text, you [Opposition Leader] will not even endorse the so-called proof," repeated Dr Muscat.               

21.40: The Prime Minister again challenged the PN leader to endorse the text uploaded by Daphne Caruana Galizia, showing an alleged declaration of trust by Egrant. Dr Busuttil hit back by asking "how is anybody expected to believe him after the way he tried to deny the Panama Papers scandal? Why had we never heard about the FIAU investigation? Dr Busuttil reminded the Prime Minister.                        

"If Egrant if yours, you are in the same boat as Konrad Mizzi and Keith Schembri. The penalty for money laundering is 18 years imprisonment", Dr Busuttil said.                       

In response, the Prime Minister turned to alleged party financing breaches. "Dr Busuttil should first investigate himself about the party financing law, where he issued false invoices to recieve large sums of money in breach of the law. I have no right to request the report of the FIAU, I must allow the institutions to work freely."

"Dr Busuttil has failed to endorse the text uploaded by Caruana Galizia, meaning that he has doubts, like we all do. The document is supposed to say that my wife sold two shares in Egrant. Whoever falsified the documents made two mistakes: the address registered to Egrant is in Panama, and the address is Mossfon street, Panama. This is the first proof of falsification. The second is a certification showing Brian Tonna acquired the company in August 2012. The text showed by Caruana Galizia, the company was sold to my Wife on 20 August 2015. Two years after Mossack Fonseca said they sold the company to Brian Tonna, they said they sold the same company to my wife."

Dr Muscat said that in light of this, whoever falsified the documents have gotten the PN in a huge mess.

21.30: The Prime Minister said : "Dr Busuttil is alleging that my wife has received a bank transfer of 1 million euros. In order for their to be a transfer of this quality, there has to be an electronic record. If Dr Busuttil does not have proof, the duty magistrate has access to such records and the truth will come out. You have spent two days hounding my family, and this is unacceptable."                        

In response, Dr Busuttil said: "the Prime Minister must remember that we do not live in Zimbabwe. We are supposed to have institutions that are carrying out investigations", 

Asked whether he would not rely on the magisterial inquiry, Dr Busuttil said that it is a little late, after bags were removed from Pilatus bank and the police raided the bank so many hours after the allegations were made.                        

Dr Busuttil said that the Prime Minister speaks very convincingly, and that if he did not know him well he would believe him. "I knew you before Malta entered the European Union, and I remember you [PM] blatantly lying about the EU. This is why I don't believe you, because I know you. You are the Prime Minister of Cafe Premier, of the private hospital, the PM of the drug-investigation of Gozo, where you appointed an ex PL candidate to head the inquiry. You even lied about Egrant by saying that you don't know who it belongs to, but then you said it belongs to Brian Tonna. Prime Minister, you have a roadmap, a roadmap to Panama".                      

Dr Muscat hit back saying "we can either speak politics or lies." He said that if the Opposition Leader would like to speak politics, "let's speak about out-of-stock medicines, about hospital waiting lists, about free childcare".                        

He challenged the PN leader to speak with the relevant regulators, giving him full permission to discuss with the highest authorities. Dr Muscat referred to the publication of an alleged transcript of documents showing the declaration of trust of Egrant, where it alleges that Michelle Muscat is the owner. He challenged Dr Busuttil to endorse the document so that he could respond. Dr Busuttil said it is up to the institutions to investigate the validity of documents, adding that the institutions are serving the PM and not the people.


Dr Busuttil asked the PM to say whether his chief of staff Keith Schembri has an account at Pilatus Bank, to which Dr Muscat said "I thought he was dead according to your friend," referring to Caruana Galizia's allegations that Mr Schembri was terminally ill.                        

"I know about the bank accounts of my chief of staff as much as you know about the bank accounts of your chief," said Dr Muscat.                      

Prime Minister Muscat, asked about why the media was not invited to a government trip to Azerbaijan in 2014, said the government always does so and conceded that it was "irresponsible".

21.20: Dr Muscat alleged that the bags taken from Pilatus Bank could have had invoices of db Group, but that the whole point was that bank transactions are electronically recorded, and should there have been a bank transaction there would be concrete proof.

He called Dr Busuttil's leadership skills into question by slamming him for repeating allegations without a shred of proof. Dr Muscat slammed him for spending a year insinuating that Egrant Inc belongs to the PM or his family, and now that he has come out and said he should have brought the proof.                        

I challenge you to bring proof. Is this what your character is made of?" said the Prime Minister                        

He explained the four hour delay for bringing the accusations to the duty magistrate by other commitments he had already delayed, and that he only did so after consulting with his lawyers.

21.16: Dr Busuttil replied that this is not a court of law, and it is the people who are judging him. "Normal people are capable of judging without entering a court of law. Your reaction was to call a press conference to deny everything. When a journalist [from The Malta Independent] asked whether an investigation will be launched, you said no. At the same time, journalists caught people leaving Pilatus Bank with large bags. What were in these bags? What do you think were in there in those bags Prime Minister? Chocolate and toothpaste?"

The PN Leader slammed the PM for knocking proof of allegations when the police only entered the bank after the large bags were removed from the bank. He said that it was incredulous that Gianni's sheep in Gozo were under constant police surveillance following allegations that there was a breach in safety standards, but that the PM was incapable of immediately deploying police to seal the bank in question.     

21.10: Asked why the police did not immediately investigate Pilatus Bank, the Prime Minister said: "the people will see that I have placed myself under a magisterial inquiry, without choosing the magistrate."

Dr Muscat said: "Dr Busuttil spent the first four minutes speaking without bringing a shred of proof of the allegations, I challenge him to bring proof."                      

He then listed all the allegations made about him. "Bank transactions are permanently recorded and cannot be hidden".                        

Dr Muscat denied the claims that there is a safe in the kitchen of Pilatus Bank, quipping that he does not know of any bank that keeps a safe in the kitchen.

21.05: The debate has started. Opposition Leader Simon Busuttil expressed his solidarity with Times of Malta Journalist Jacob Borg, who was shoved earlier today by men escorting Minister Konrad Mizzi. He said that this is not the behaviour of a democratic country. "A national demonstration was called because Malta finds itself in a political and constitutional crisis," he said, adding that this is so because the Prime Minister is under a Magisterial Inquiry.

"He cannot continue in his role while under investigation". 

"The first thing that the Prime Minister and 'his friends' did after taking office, and winning the election by 36,000 votes was to acquire offshore Panama-based companies. Minister Konrad Mizzi was going to commit to deposit 1 million, how was he going to do this?" Dr Busuttil asked.

Dr Busuttil said that instead of being at the police headquarters to be interrogated, Dr Muscat is on a national programme discussing the scandal.

"We have called a national demonstration because people want to express their disgust, and express their wish for the Prime Minister to resign." He said that this demonstation is not of the PN, but also includes former chairman of Alternattiva Demokratika Michael Brigulio, who has accepted to speak at the demonstration, as well as PD's Marlene Farrugia.

20.57: Prime Minister Joseph Muscat has arrived, but very few fans were waiting.

20.47: Opposition Leader Simon Busuttil arrived, with quite a crowd waiting for him.

Earlier, a number of people were waiting outside the tudio where Xarabank is shot. Just before the debate started, police and a number of members of the public could be seen outside. certain people held placards up high, with the words 'Pilatus Bank' and 'justice' written.

Photos by Baskal Mallia

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