The Malta Independent 15 October 2021, Friday

Keith Schembri's wife charged with laundering €1.5 million, granted bail

Friday, 17 September 2021, 13:03 Last update: about 28 days ago
Photo: Miguela Xuereb - Newsbook
Photo: Miguela Xuereb - Newsbook

Josette Schembri Vella and her company 3City Designs Ltd, have been charged with money laundering €1.5 million.

Schembri Vella, 45, of Mellieha, appeared in court before magistrate Claire Stafrace Zammit, accused of laundering money between 2008 and 2020 and failing to observe all of the duties of a company director.

She is the wife of the former Muscat administration’s Chief of Staff Keith Schembri, who is himself accused of money laundering in separate proceedings.

The prosecution was unable or unwilling to say what the predicate offence – the crime necessitating the laundering of the money – was.

This was part of a worrying trend, said the defence, whereby people were arraigned on what appeared to be trumped up money laundering charges and arguing that this was all because of Malta’s greylisting.

Gatt argued that the charges had nothing to do with the evidence she was shown in disclosure by the police, decrying what he said was a “huge abuse of power.”

She pleaded not guilty to the charges and was granted bail against a deposit of €10,000 and a personal guarantee of €40,000.

Lawyers Edward Gatt, Veronique Dalli, Mark Vassallo and Ishmael Psaila appeared for the accused.

Lawyers Antoine Agius Bonnici and Andrea Zammit appeared for the office of the Attorney General. Superintendent Frank Anthony Tabone and Inspectors Lianne Bonello and Ian Camilleri prosecuted.

(Top Photo: Miguela Xuereb - Newsbook)

14:08 The sitting is now over. Thanks for following the sitting with us. We will be uploading a full write-up shortly.

14:07 Bail is being granted against a €10,000 deposit and personal guarantee of €40,000.

14:07 Schembri Vella is to sign a bail book four times a week, and must observe a curfew between midnight and 6:30am.

14:06 Agius Bonello says that the prosecution is insisting on a curfew. Bail is granted. The court reads through the decree.

14:05 The magistrate asks if the prosecution is insisting on a curfew. The defence points out that she might need to pick up her children at late times, or that other issues may crop up.

14:04 There is silence in the courtroom as the magistrate writes down notes on her decree.

14:03 He continues that her money is all frozen. The attachment order extends to her entire family, including her children who are minors. This is confirmed by the prosecution, but the AG lawyer says the children's freezing order was later lifted. Xerri de Caro asks for a balance to be struck between the conditions and her rights.

14:02 "She has two children, aged 16 and 18, and takes care of them. Her husband is going through what he is going through, and let us not say that Josette Schembri Vella could abscond," Gatt says.

14:01 She is being accused as a representative of the company, the AG lawyer says. Gatt thanks the prosecution for not objecting, and says it is up to the court to decide on the conditions. He adds that the couple are going through enormous financial difficulties, and remarks that there is a witch-hunt against her husband and his father.

13:59 There are witnesses who may be approached, and an additional fear that she could abscond, he says.

13:58 Gatt dictates a note, objecting to the freezing order and specifying that the amount being laundered is €1.5 million.

13:57 Inspector Leanne Bonello is now summoned to the stand. She says the amount is €1.5 million, which results from several transactions on which they were given in disclosure. Gatt is accusing her of lying.

13:56 Tabone is asked on the amounts transferred to the companies being charged today. "All I can say is that the investigators drew my attention to transactions from one company to another company, and I told them to give her disclosure on what they had."

It is understood that one of the companies in question is 3City Designs Limited, in which Schembri Vella owns a 50% shareholding in. KASCO Holdings, her husband's company, owns the remaining 50%.

13:48 Gatt begins to question Tabone, who is a superintendent stationed in the Financial Crimes and Investigations Department.

13:48 Gatt asks that Superintendent Tabone be summoned to testify on the freezing order. He is summoned and administered the oath.

13:47 Superintendent Frank Tabone says that they were asked about the facts on which disclosure is given. Gatt invites him to dictate a note saying that the charges he is arraigning on today was tied to the disclosure - but the lawyer refuses.

"See?" Gatt tells the court.

13:45 The defence is strongly objecting the request for a freezing order. Gatt says the disclosure given by police was unrelated to today's proceedings. "We have a huge abuse of power here," Gatt exclaims.

13:44 The court asks if a value would be specified later on during the proceedings. Meanwhile, Gatt states that it is obvious that police have no idea of how much money was allegedly laundered, similar to Yorgen Fenech's arraignment when police failed to specify the exact predicate crime nor the exact amounts laundered.

13:41 Gatt asks if the prosecution is in a position to declare how much was laundered. Another lawyer from the Attorney General's office, Antoine Agius Bonnici, says he is not in a position to do so.

"Of course you're not in a position to do so. You should be ashamed of yourselves," shouts Gatt.

13:39 He additionally stated that a new practice is developing whereby a predicate offence isn't needed for money laundering charges. The charges she faces are that, as director, she didn't follow the obligations of a director, that she didn't call as many board meetings as required.

13:38 "These are all strategic actions by a powerful person which are not necessarily intended to satisfy the juridical aspect," he continues. "I cannot but object to the request for a freezing order."

13:37 It appears that she has been under an attachment order for a year, with the order expiring today.

13:36 He continues that they will be contesting the accusations. "These are trumped up charges, some don't exist," he goes on.

13:35 Edward Gatt argues that he is noticing a common practice as of late with regards to financial offences. He says they are pushed by "national necessity".

13:34 Schembri Vella is asked her details, replying that she is an interior designer. She pleads not guilty to the charges. The Attorney General's lawyers explain that the freezing order is being requested over the company, and not on her own assets.

13:30 The sitting begins. Lawyers Antoine Agius Bonnici and Andrea Zammit are appearing on behalf of the Attorney General's office. Lawyers Edward Gatt, Mark Vassallo and Veronique Dalli will be defence counsel to Schembri Vella.

13:16 Good afternoon. We will be reporting live as Keith Schembri's wife, Josette Schembri Vella, is set to be charged with money laundering this afternoon.


 

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