The Malta Independent 17 July 2024, Wednesday
View E-Paper

Court declares enough evidence against Muscat, Mizzi, Schembri for case to go on; company discharged

Albert Galea Tuesday, 25 June 2024, 09:45 Last update: about 21 days ago

The courts have declared that there is enough evidence for the case against former Prime Minister Joseph Muscat, his former chief of staff Keith Schembri and former minister Konrad Mizzi - together with a host of other accused individuals and companies - to continue, but discharged the company Sciacca Grill Ltd from the case.

Magistrate Rachel Montebello on Tuesday decreed on whether there was enough evidence prima facie - at first glance - for the charges against the accused to stick and for the accused themselves to be indicted. She said that the case could move forward against all of the accused except for Sciacca Grill.

Sciacca Grill, previously known as Kasco Foods Ltd and previously owned by Keith Schembri, was therefore discharged, although prosecutors may still carry out further investigations into the company leading to future criminal charges.

In the case of all the other accused - including Muscat, Schembri and Mizzi - it is now up to the Attorney General to issue a bill of indictment against them. The prosecution has up to 20 months, however, to finish presenting the evidence in the compilation process before doing so, should it wish.  If a bill of indictment is issued, then the accused would go on to stand trial

Lead prosecutor Francesco Refalo earlier in the sitting had argued that this company was being given contracts together with others which had Keith Schembri as a director in order to supply other companies in the deal – companies which prior to Schembri’s involvement were already supplying the hospital.

Refalo continued that the company was “skimming money off the concession” by taking a cut from these new supply contracts.

The magisterial inquiry makes it clear that this tactic was used by other members of the concession to skim money off the concession when the fact was that companies like Sciacca Grill Ltd did not need to be involved, Refalo said.

Refalo said that the defence may argue that Keith Schembri was not a director of the company, but the control of the company goes beyond directorship.

Franco Debono, representing Sciacca Grill, however contested the prosecution: “God forbid we reduce the prime facie to this methodology,” he said, adding that the prosecution did not refer to piece of evidence or any particular page of anything to back up their claims.

He cited two cases – one against Alphonse Abela, who was charged with fraud in connection with school buses, and another against Joseph Le Brun, who was charged with trafficking heroin – who were both acquitted at the prima facie stage.

“I don’t even have anything to reply to, because the Attorney General gave us nothing… not a single reference to the evidence,” he said.

Magistrate Montebello ultimately decreed that the prosecution had in fact not presented enough evidence to back up the charges against Sciacca Grill, therefore discharging them from the case.

This was not so in the case of the myriad of other people and companies charged in the case.

The company was the only one out of the 14 individuals and eight other companies to be discharged.  The case against the rest will continue after the magistrate decreed that there was enough prima facie evidence against them to substantiate the charges.

That includes Muscat, Schembri, and Mizzi – all of whom did not actually contest the prima facie declaration before Magistrate Montebello’s decree.

Some of the accused however did file submissions contesting the prima facie declaration before it was issued.

Lawyer Chris Cilia, representing the company MTrace, made it a point to refer to the magisterial inquiry’s “narrative” rather than “findings” and questioned why Josie Muscat – who testified last week and who Cilia said was central to the disputed cyclotron machine – was not brought in to testify before the inquiry.

He continued that the inquiry makes “completely gratuitous” assertions on the cyclotron, and says that had the magistrate spoken to Josie Muscat and the representatives of Taomac they would have come to the conclusion that what is being said about the cyclotron is “a fable.”

“We do not believe that [Josie] Muscat’s withdrawal or removal from the project was coincidental,” Cilia read from the inquiry – “without having heard him testify!”  These experts, he said, had concluded that Taomac were somehow front-men for Vitals.

“If they had summoned Dr [Josie] Muscat to testify, they knew that this narrative would have fallen by the wayside,” Cilia said.  He continued that the experts operated under the mantra of “never let the truth get in the way of a good story.”

Lawyer Arthur Azzopardi contesting the prima facie first on behalf of Brian Bondin said that there is no appendix in the magisterial inquiry pertaining to him, and that the experts make assertions on him which are not definitive, referring to the words ‘potential fraud.’

“The problem isn’t the magistrate, the problem is how the experts worked,” Azzopardi said.

He continued that the experts had relied on Wikipedia and invited the Magistrate to search for the words ‘opinion’ and ‘assumption’ in the inquiry – the word ‘assumption’, he said, will appear 70 times.

A search for Brian Bondin in the inquiry meanwhile will result in just 14 sentences, which the lawyer said the experts rely on the word ‘potential’ for.

Lawyer Jason Grima, representing Jonathan Vella, said that there is no mention of Vella in the magisterial inquiry’s appendixes, and the inquiry had not provided any explanation as to whether Vella’s acts had criminal intent.

The fact that he worked with auditor Chris Spiteri – also one of the accused – means nothing because this was simply his job, Grima said of his client.

Grima said that the media had reported that Vella was a laywer – which isn’t true; that he was an accountant – which isn’t true; and that the inquiry had said that he was an auditor – which isn’t true either.  “All he was is an accounts clerk with Christopher Spiteri,” the lawyer said.  His job was to do secretarial work for Spiteri.

He continued that nobody had summoned Vella to testify and that his bank account was not analysed or exhibited either unlike others, but said that had they been exhibited it would have been made clear that all he receives was his salary and not the millions that the inquiry said he apparently received.

Grima said that one also needs to see what role Vella has: he notes that Vella had resigned from the company Bluestone Investments on 14 November 2016, and he was succeeded by Ram Tumuluri “who for some reason is not being charged as far as I know.”

Grima continued that Vella had no access to the Bluestone bank accounts.  He reeled off a list of names who, as per evidence, had direct access to Bluestone’s accounts but Vella isn’t one of them.  “A number of these people aren’t being charged either, even though they had more access, power and would approve all of the invoicing that passes through Bluestone… but Jonathan Vella is being charged.”

Azzopardi then spoke again to contest the prima facie against the companies Gateway Solutions and Technoline. 

In the case of the latter Azzopardi said that one would have expected that in four years, the various experts in the magisterial inquiry at least point in the same direction.  According to one expert, Azzopardi said, the illegality in Technoline is simply in its existence because Gateway Solutions bought it. The experts Harbinson then said that the illegality is that Technoline paid €635,500 to Steward, Azzopardi continued.

The Attorney General said that it would not be considering the shareholding matter, Azzopardi pointed out, and was focusing on the payment.  On this payment however, it is not clear what crime this payment exactly represents, the lawyer said.

Despite the arguments to the contrary however, Magistrate Montebello declared that the case against them could go on.

 

The next sitting for the case to continue will take place on 1 August.

13:31: That is the end of our live commentary for today.  A summary of the day's proceedings will follow later this afternoon.  In the meantime, thank you for following!


13:30: What does this mean for the prosecution vis-à-vis Sciacca Grill Ltd?

Maltese law states that if a magistrate can see no prima facie evidence for the Attorney General to issue a bill of indictment within 30 days of the charges being filed in court, then the suspects would be discharged unconditionally and the police would have to present new evidence to charge them again.

This means that the prosecution has two effective courses of action before it:  it can either drop the case against Sciacca Grill entirely; or it can try and find new evidence in order to make the charges against the company stick.


13:19: Magistrate Montebello says that her decree is quite voluminous and asks whether she can read the final, most relevant parts of the decree.

She says that there is prima facie evidence against all of the accused except for Sciacca Grill Ltd, which used to be known as Kasco Foods. 

Therefore Sciaccia Grill Ltd has been discharged from the proceedings.

Magistrate Montebello meanwhile has also directed the prosecution to bring forth statements from Swiss banks for Accutor and Spring Healthcare and companies associated with them in order to identify transactions between those companies and those related to the hospitals concession and transactions internally.

She continues that those documents are necessary within the context of the money laundering charges being presented.

The magistrate also wants records and statements for Steward’s company based in the US for between 2017 and 2022; banking records for MTrace Ltd; and local bank representatives to testify about Kasco Engineering.

The court therefore declares that there is enough evidence for at first glance for all of the accused except for Sciacca Grill to be formally indicted.

The sitting has been deferred to Monday 1 August at 10am. 


13:05: Court is back in session. 


12:04: The court orders that the case is postponed in order for it to take into consideration the submissions on prime facie which had been made.

The sitting is suspended for 45 minutes, and when Magistrate Montebello returns, she will issue her decree on the prima facie.


12:02: Azzopardi questions what evidence there is against Gateway Solutions, saying that while there is no doubt that at some point the company was loaned  money to acquire Technoline, experts would have to prove that the company acted incorrectly – not its directors.

The loan, he said, was paid with the approval of three large firms, including one of the largest law firms on the island.

The agreement for the share transfer to Gateway was still a draft because the other company did not have any directors at that point. The prosecution cannot do more, because there is nothing more than that in the inquiry, Azzopardi submits.

Now speaking about Technoline, Azzopardi says that one would have expected that in four years, the various experts in the magisterial inquiry at least point in the same direction.  According to one expert, Azzopardi says, the illegality in Technoline is simply in its existence because Gateway Solutions bought it.

The experts Harbinson then say that the illegality is that Technoline paid €635,500 to Steward, Azzopardi says. 

The Attorney General said that it would not be considering the shareholding matter, Azzopardi pointed out, and was focusing on the payment.  On this payment, it is not clear what crime this payment exactly represents.


11:45: Refalo now replies to the court application which Arthur Azzopardi filed for Technoline.  He says that at 8:30am or 9am the court application was filed, and Azzopardi renounced his brief at 9:30am.

The prosecution says it does not see a change in circumstances since the court’s last decree, but would submit to what the court decides today on the matter due to its sensitivity.

Azzopardi says that Eurybates and Gateway regardless do not have any money in their accounts and therefore he cannot be paid, but there is a request from Technoline to pay on behalf of those two companies too.  Magistrate Montebello has some concerns on this, considering that all three are subject to separate freezing orders.

She ultimately concludes that proceedings can continue, but says that the two companies -Eurybates and Gateway Solutions – should, if they wish, submit their own court applications in order to cover the legal expenses that need to be paid for their defence in these procedures.

The court therefore states that Azzopardi will now be re-assuming his brief for the companies, and he will now be allowed to make submissions contesting the prime facie for Technoline and Gateway Solutions.


11:34: He said that nobody had summoned Vella or spoken to him, and said that the irony is that for much smaller cases – like someone caught driving without a licence – lawyers are sometimes called up at 3am because the police offer the right to a lawyer and to questioning.  In this case, nobody offered Vella that opportunity.

His bank account was not analysed or exhibited either unlike others, but had they been exhibited it would have been made clear that all he receives was his salary and not the millions that the inquiry said he apparently received.

Grima says that one also needs to see what role Vella has: he notes that Vella had resigned from the company Bluestone Investments on 14 November 2016, and he was succeeded by Ram Tumuluri “who for some reason is not being charged as far as I know.”

Yet Vella is still being accused due to his vested responsibility as the secretary of Bluestone, Grima observed.

Grima continues that Vella had no access to the Bluestone bank accounts.  He reels off a list of names who, as per evidence, had direct access to Bluestone’s accounts but Vella isn’t one of them.  “A number of these people aren’t being charged either, even though they had more access, power and would approve all of the invoicing that passes through Bluestone… but Jonathan Vella is being charged.”


11:27: Lawyer Jason Grima now speaks for Jonathan Vella.

He too says that there is no mention of Vella in the magisterial inquiry’s appendixes, and the inquiry had not provided any explanation as to whether Vella’s acts had criminal intent. 

The fact that he worked with auditor Chris Spiteri – also one of the accused today – means nothing because this was simply his job, Grima says of his client.

Grima says that the media had said that Vella was a laywer – which isn’t true; that he was an accountant – which isn’t true; and that the inquiry had said that he was an auditor – which isn’t true either.  “All he was is an accounts clerk with Christopher Spiteri,” the lawyer says.  His job was to do secretarial work for Spiteri.


11:21: He says that the experts had relied on Wikipedia and invited the Magistrate to search for the words ‘opinion’ and ‘assumption’ in the inquiry – the word ‘assumption’, he says, will appear 70 times.

A search for Brian Bondin in the inquiry will result in just 14 sentences, which the lawyer says the experts rely on the word ‘potential’ for.

He said that the experts themselves had the merest form of suspicion on Bondin, and said that they don’t have all the financial data – but came up with these conclusions regardless.


11:14: Speaking about Bondin, Azzopardi says that there is no appendix in the magisterial inquiry pertaining to him, and that the experts make assertions on him which are not definitive, referring to the words ‘potential fraud.’

“The use of the word ‘potential’ with regards to MTrace, is always less than probable, which is required for prima facie,” Azzopardi says.

He argues that the experts in the inquiry had not taken into consideration that apart from the concession agreement there were a number of other specific agreements.  The experts, Azzopardi says, concluded that the money became government money the moment Steward and Vitals became involved, but this conclusion is wrong because as soon as it was paid, it was no longer public funds.

“The problem isn’t the magistrate, the problem is how the experts worked,” Azzopardi says.


11:07: “If the court wants to deny the defendants the right to be represented by a lawyer of their choosing, the court can carry that responsibility.” He says the court cannot expect him not to be paid for the work he is doing in the criminal case. “I have no choice.”

“So you are blackmailing the court,” Magistrate Montebello observes.  Azzopardi says this isn’t the case and explains that the court application filed this morning was so that he could be allowed to be paid by the companies.

Magistrate Montebello directs the Attorney General to ready its response to the court application – which appears to be on this payment topic – during this court sitting.  

In the meantime, she allows Azzopardi to make his submissions on prima facie with respect to Brian Bondin, who was the director of MTrace.


11:01: Court is now back in session. 

Magistrate Montebello, who is still greatly displeased with Arthur Azzopardi, asks the lawyer whether he was renouncing his patronage to the companies as she waves a court application saying that Azzopardi himself had submitted this earlier this morning.

Azzopardi argues in a back and forth with the magistrate that he had been paid for that court application, but he was not being paid for the work he was doing in the courtroom because the company’s funds had been frozen.


10:36: It’s Arthur Azzopardi’s turn and he says that he will be speaking on behalf of Brian Bondin.  But he is stopped in his tracks by the magistrate, who gives him a telling off for ditching the brief of the companies mentioned earlier belonging to Ivan Vassallo.

Ethics requires, Magistrate Montebello says, that the lawyer should have told Vassallo before the sitting and not surprised him on the day.  She tells Azzopardi she will not hear anything from him until he speaks with Vassallo about this, and suspends the court sitting for a few minutes to give the lawyer time to make amends.


10:34: Magistrate Montebello asks Cilia about the claim that MTrace had received a soft loan from Malta Enterprise which was fraudulent because the company did not have the funds to pay its 31% share of expenses on the project.

“The 31% and whether they came out of the concession does not concern MTrace, because MTrace was the passive subject in the transaction,” Cilia replies. 

He says that by 2020 over €2.3 million had been invested. “In what? A cyclotron that is there, that is built and only needs to be commissioned,” Cilia says.

He concludes that had the magistrate actually summoned Josie Muscat it would have been clear that the claim that VGH was the actual owner of MTrace and the cyclotron could have been dispelled.


10:25: Lawyer Chris Cilia now makes his submissions on behalf of MTrace, and says that the “narrative” in the inquiry is clear.  He says he is making it a point to use the word “narrative” rather than “findings” to refer to the inquiry.

He questions why exactly Josie Muscat – who testified last week and who Cilia says was central to the case and the brain behind the cyclotron – was not brought in to testify to the inquiry.

He continues that the inquiry makes “completely gratuitous” assertions on the cyclotron, and says that had the magistrate spoken to Josie Muscat and the representatives of Taomac they would have come to the conclusion that what is being said about the cyclotron is “a fable.”

“We do not believe that [Josie] Muscat’s withdrawal or removal from the project was coincidental,” Cilia reads from the inquiry – “without having heard him testify!”  These experts, he said, had concluded that Taomac were somehow front-men for Vitals.

“If they had summoned Dr [Josie] Muscat to testify, they knew that this narrative would have fallen by the wayside,” Cilia says.  He says that the experts operated under the mantra of “never let the truth get in the way of a good story.”


10:20: Sciacca Grill Ltd is represented by Franco Debono, and he rises to answer the prosecution.

“God forbid we reduce the prime facie to this methodology,” he begins, saying that the prosecution did not refer to piece of evidence or any particular page of anything to back up their claims.

He cites two cases – one against Alphonse Abela, who was charged with fraud in connection with school buses, and another against Joseph Le Brun, who was charged with trafficking heroin – who were both acquitted at the prima facie stage.

“I don’t even have anything to reply to, because the Attorney General gave us nothing… not a single reference to the evidence,” he said.


10:14: Lead prosecutor Francesco Refalo says he will rest on his previous submissions with regards to Taomac, which was in the last sitting.

Refalo says that today the prosecution will focus on Sciacca Grill Ltd – previously known as Kasco Foods Ltd.  He says that this company was being given contracts together with others which had Keith Schembri as a director in order to supply other companies in the deal – companies which prior to Schembri’s involvement were already supplying the hospital.

Refalo continues that the company was “skimming money off the concession” by taking a cut off these new supply contracts.

The magisterial inquiry makes it clear that this tactic was used by other members of the concession to skim money off the concession when the fact was that companies like Sciacca Grill Ltd did not need to be involved.

Refalo says that the defence may argue that Keith Schembri was not a director of the company, but the control of the company goes beyond directorship.

He says that this is strong enough basis for the prima facie to subsist against the company.


10:08: Lawyer Veronique Dalli, who is representing Taomac Ltd, which had sold its shares in MTrace to Vitals Global Healthcare via a company called Vitals Procurement Ltd in Jersey, is now making an argument with regards to the court’s prima facie declaration – which is the court’s declaration on whether there is a case to be answered for.

She quotes caselaw which says that the prosecution only needs to prove knowledge or suspicion on whether the money that the defendant received was illicit, and says that in Taomac’s case this suspicion was based on just one witness.

“The prosecution is saying that Taumac should have suspected that someone recommended by the Maltese state [was committing criminal offences],” Dalli argues.


10:01: Lawyer Chris Cilia now rises to make a point, referring to a post on social media – on Jason Azzopardi’s page specifically – which said that the Malta Enterprise representative had lied under oath.  The lawyer says that this is absolutely not true, but they cannot answer to it because they are bound by an order from the court to not speak about the case.

Magistrate Montebello asks Cilia to submit an application if he wants the court’s opinion. “Submit an application,” she repeats three times as the lawyer continues his argument. “But others didn’t submit an application, they just posted,” Cilia says. “Ok,” the magistrate replies tersely.


09:59: The first order of the day is that Arthur Azzopardi, the lawyer representing Technoline Ltd, Gateway Solutions Ltd, Eurybates Ltd, has said that he was renouncing his brief for the companies.  This is on the basis that the companies have no means to pay him.

Ivan Vassallo – who is also one of the accused in this case and who is the director of these companies – is quite shocked by this development, and says that he has no lawyer in mind to take on the brief.

Magistrate Montebello asks for a legal aid lawyer to be brought in to represent the companies, but it’s not quite clear if this can be done.


09:51: Today’s hearing is running slightly behind schedule, but is now in session as magistrate Rachel Montebello enters the courtroom.  Today’s sitting is expected to run until 13:00.


09:49: Good morning and welcome to today’s live commentary from court room 22 in Valletta.

 

  • don't miss