Former Economy Minister Chris Cardona told a court on Wednesday that he didn’t even know who the investors he was signing a memorandum of understanding with for Gozo’s health sector in 2014 were, saying that he had signed because it was his responsibility as a minister.

The MoU in question is the cornerstone of one of the chief controversies surrounding the hospitals concession – the National Audit Office concluded in an investigation that the concession should never have been granted to Vitals Global Healthcare because the MoU had been signed before the tender was even issued.

The MoU was signed between the government and a consortium represented by Mark Edward Pawley in his capacity as Director of Bluestone Special Situation 4 Ltd, Dr Ashok Rattehalli in his capacity as Director of AGMC Incorporated, and Mohammad Shoaib Walajahi and Chaudhry Shaukat Ali in their capacity as Directors of Pivot Holdings Ltd.’

This was in November 2014 – before the request for proposals for the greater hospitals concession, which included the Gozo General Hospital together with two other hospitals, was published.

Vitals Global Healthcare, which went on to win the tender bid despite having no experience in healthcare, was a company created as a subsidiary of Bluestone Special Situation 4 Ltd – one of the signatories of the MoU.

The agreement was signed at the Prime Minister’s office in Castille, but Cardona did not remember any particular reason as to why this was the case when questioned.

Cardona testified on Wednesday that he hadn’t even been given any background to the MoU or on whom the government was signing it with. “I didn’t even know who they were,” Cardona told magistrate Rachel Montebello on those he had signed with MoU with.

Cardona was testifying in court proceedings against former Prime Minister Joseph Muscat, his ex-top aide Keith Schembri, former minister Konrad Mizzi, and a host of others who face several serious charges in relation to the hospitals concession.

Cardona, who served as Economy Minister between 2013 and 2020 – when he resigned from parliament and disappeared from the political scene, explained that the MoU was specifically geared towards the Gozitan medical complex and included stipulations about how the Barts Medical School can be integrated.

“I just read the memorandum and signed it,” Cardona said. Asked why he signed it if he didn’t know any background on it, he simply replied that he signed it because he was the minister responsible for Malta Enterprise.

“The memorandum wasn’t renewed – if I’m not mistaken, it was withdrawn by Malta Enterprise because after discussions it showed that it did not lead to what the government wanted,” he said.

“The experts make it seem like something illegal was written into the MoU – did you see something which bothered you,” Joseph Muscat’s legal counsel Vincent Galea asked the former minister. “No, no, no… nothing at all.  Absolutely not,” Cardona replied.

Galea asked Cardona whether he had received any pressure from Muscat for this MoU to be signed. “I never spoke about the memorandum with Dr Muscat or anyone else,” Cardona replied.

Galea also asked why the MoU was then not followed up by the government. “It did not specifically address the plan that the government of the day have for the health sector,” the former minister said.

Cardona explained that an MoU is a “preliminary non-binding agreement to test the waters.”  There has to be an understanding, he says, for things to be delivered by a group of investors.  “At this stage, I don’t think a proper due diligence would have been done – or maybe there would have been something, but not an enhanced due diligence,” he says.

Three representatives from Big Four firm PricewaterhouseCoopers (PwC) testified at length during Wednesday’s sitting, with their contributions centring on the firm being engaged by Vitals’ parent company Bluestone

Michel Ganado, a management consultant at PwC, was the first out of the three to take the stand.

He said that PwC’s involvement in the concession started in October 2014 when they were approached by the company Bluestone, which informed them that they had an MoU with the government to put forward a business plan by January 2015 for the development of a medical facility in Gozo.

Prosecutor Rebekah Spiteri asked who he had discussions with, to which Ganado replies that discussions were with Mark Pawley but the designated representative of the company was Ram Tumuluri.

PwC was engaged again in April 2015 when the RfP was issued, at which point Bluestone approached the company for help with the bid submission, Ganado said.

Asked under cross-examination by lawyer Gianella De Marco whether he saw anything untoward while involved with Bluestone, Ganado replied that he hadn’t.

Under cross-examination, Muscat’s lawyer Vincent Galea asked whether he felt that the business plan that Bluestone presented was realistic. “I cannot say yes or no – at the end of the day, you are providing a service and it is to the best of your ability within the context of what your client is requesting,” Ganado first said.

But under a more direct question from the magistrate to the same ends, he replied: “At that point in time, yes.”  

PwC partner Lucienne Pace Ross detailed the various engagements that PwC had with Bluestone and later Steward Health Care.

There were five engagements with Bluestone, ranging from assistance to prepare a business plan for the purposes of the 2014 MoU, to aiding the preparation of the bid for the RfP a few months later, to an indication on the value of the concession in July 2016.

The firm also had agreements with Bluestone and later Steward for tax advisory services and technical accounting advice respectively at a later stage.

PwC director Angelique Spina gave a more technical explanation on the work which the firm did for Bluestone and later Steward.

Spina said that the company’s onboarding process produced “no red flags” on Bluestone and so PwC began working with it.  Ram Tumuluri was the main contact point, but she says that there were other people introduced, including foreign doctors and a US-based architecture firm, who gave their inputs.

Asked about the 2014 MoU, Spina said that the company was engaged to help with the business plan and social impact assessment.  After that, the company was engaged again for the RfP process.

“It was different because it was no longer the Gozo Hospital, but it became much bigger as it included St Luke’s and Karin Grech and the Gozo Hospital in a bit of a different way,” Spina said.  “To me they’re separate,” she added.

She said that PwC did not do any verification on any of the documents which Bluestone provided as part of its preparation for the RfP bid, but the firm was happy with the bid because Bluestone had provided all the necessary documentation.

To her, she said, the bid appeared realistic because Bluestone had engaged the necessary experts in the requisite fields when it reached the numbers of what it was proposing.

On Steward meanwhile, in reply to lawyer Jason Grima, Spina said that PwC was engaged to offer expert advice due to the complex and extremely technical accounting standards that Steward had to follow.

She insisted however that PwC never saw any draft accounts before they were signed off by the company directors.

Finally, Antoine Cremona, a partner at the law firm Ganado Advocates, also testified.

Cremona explained that the law firm gave legal services to Projects Malta on the concession between 5 February 2015 and 24 July 2015 – which was the last date that the firm did anything “substantial.” 

“Our conclusion was almost immediately that the process needed a competitive procedure in the open market,” Cremona said as he explained the legal advice given to the government. He said that the firm went as far as engaging an Irish law-firm to ensure that the legal advice given followed best practice, in light of an EU directive on procurement which had just been issued.

He said that “there was always a sense of urgency” with regards to the project from different people involved in it.

Aron Mifsud Bonnici – one of the accused in this case – was the instructing counsel on behalf of Projects Malta, and the one liaising with Ganado Advocates.

Cremona said that the legal advice given had taken into consideration the controversial MoU, which he said had been brought to their attention by Mifsud Bonnici in an email from March 2015.

Galea meanwhile asked whether anybody at the law firm had been in touch with Joseph Muscat, to which Cremona replied in the negative.  He also asked whether the lawyer had seen anything illicit. “No there was nothing illicit, but it was too rushed,” Cremona replied.

Under cross-examination by Galea, Cremona said that it was the law firm’s opinion that the fact that there was an MoU on part of the concession might give reason for appeal from some private operators on the basis of the wholeness of the tender process.

Galea said however that the law firm never gave advice for a bidder to be excluded because of this MoU. “We didn’t, but that’s not how it works,” Cremona replied. “There has to be an equal race in the market,” he added.

The case continues on 23 September.

14:01: That brings today’s sitting to a close – a summary of today’s proceedings will follow in the coming hours. Thank you for following!

14:00: Magistrate Montebello says that Spina was the last witness of the day.

There are still 8 witnesses outside but, unfortunately for them, their day on the witness stand will have to wait.

The acts of the case will now be sent back to the Attorney General’s office – a process known as a ‘rinviju’ – and these 8 witnesses will be heard at the next sitting on 23 September.

One of the experts appointed in the magisterial inquiry will be summoned to testify on 2 October. There is some debate over whether the witness in question should testify in person or via video conference.

“They are experts,” Magistrate Montebello says as lawyer Stephen Tonna Lowell points out that if they are to testify via video conferencing then the court has no control over keeping them in line. “They are experts who we are going to start proceedings against soon,” lawyer Edward Gatt chimes in.

13:50: Spina has delved into a step-by-step explanation of PwC’s work, at the behest of lawyer Stefano Filletti, who has requested her to dumb down the company’s work.

Filletti asks about the UK firm that Bluestone engaged and whether Spina knew who they were.  She hesitates a bit and simply says that when she looked them up it emerged that they’re a boutique audit firm.

Filletti asks about the services rendered after the concession was issued, and Spina says that PwC offered tax advisory services and support with regards to financing and a value estimate of the concession to VGH.

To Steward, PwC provided accounting advisory services of a more technical nature as it had to reflect a particular accounting standard. Tax advisory services were also provided to Steward.

Lawyer Jason Grima is next – the magistrate implores him not to repeat previous questions.

He asks whether Steward had in-house accountants, to which Spina said they had, and so Grima asks why PwC was engaged.  Spina replies that the accounting standard Steward had to follow was “extremely complicated” and its own accountants were not qualified and needed expert advice, which is why they were needed.

She says she had contact with two accountants – Sava Abbas and another one named Miro – and the discussion was advice on how to transfer their accounts to be in line with this standard. 

She says that PwC had nothing to do with Steward’s audits.  Grima asks whether they were ever shown drafts by the directors but Spina denies this. “We never saw accounts before they were signed,” she says.

Spina steps off the witness stand.

13:31: Vincent Galea asks Spina to list who was involved in these engagements on PwC’s side.  She obliges and lists a number of names.

Galea asks who accompanied the client to the bank, but Spina says that nobody accompanied the client to the bank. “We don’t do any verification – it’s not our job,” she says on documents which the client provides.

Galea asks how the client is meant to know what documents to gather, but Spina replies that the RfP contains a checklist of documents, so the client – in this case, Bluestone – knows what the gather.

She reiterates that the company does not do its own verifications on documents.  “We were project managers,” she says.

Galea asks whether in the documentation there was anything that caused any suspicion or red flag. “No there wasn’t,” Spina replies. “The client was happy with what we closed for him,” she continues.

“My checklist was full and it was good because the client provided all the documentation necessary, so I was satisfied,” she says. “So everyone was happy, both you and the client,” Galea observes.

Galea asks whether the financial plans that Bluestone had appeared realistic.  “At the time yes we felt it was realistic,” she says.  She explains that the fact that Bluestone had enough specialists in different fields, supporting the client’s inputs, meant that it felt realistic.

13:21: “We are just data modellers,” Spina says as she details the work that PwC did during the process of Bluestone’s preparation work for its submission to the RfP.

It was Bluestone who drafted the business plan – PwC were engaged to assist with it, and every update and adjustment made to this plan was with the consent and awareness of the client.

PwC’s later role was to review a financial model which was prepared by a third party – a UK-based firm, Spina says. This was within the context of the client looking for financing in order to carry out parts of the project.

“This review, as such, was never really concluded,” Spina says.  “It’s not just mathematical accuracy but there’s also completeness of documentation, but certain documents weren’t being provided, so the process was going but we were just issuing ‘issues report’ which showed what documentation was missing,” she continues.

This work stopped when Steward took over the concession from Vitals.

13:14: PwC director Angelique Spina is the next to take the witness stand.

Spina is asked about the client onboarding process, says there were “no red flags” on Bluestone and so PwC began working with it.  Ram Tumuluri was the main contact point, but she says that there were other people introduced, including foreign doctors and a US-based architecture firm, who gave their inputs.

Asked about the 2014 MoU, Spina says that the company was engaged to help with the business plan and social impact assessment.  After that, the company was engaged again for the RfP process.

“It was different because it was no longer the Gozo Hospital, but it became much bigger as it included St Luke’s and Karin Grech and the Gozo Hospital in a bit of a different way,” Spina says.  “To me they’re separate,” she adds.

13:02: Over the years there were other agreements for services, Pace Ross says.

One agreement was with Bluestone while there were others which were with Steward.  Their nature was to provide tax advisory services and also technical accounting advice on, for example, how to account a service concession, Pace Ross explains.

Vincent Galea asks who handles the onboarding process, to which Pace Ross says that there is a risk management team who would work with the client engagement team to acquire the necessary documents.

Pace Ross steps off the witness stand.

12:53: PwC partner Lucienne Pace Ross is the next witness.

She details the onboarding and screening process done on Bluestone and the individuals Mark Pawley, Ram Tumuluri together with the companies in the structure and says that there were no red flags on any of them.

She exhibits three letters of engagements that PwC had with Bluestone – all of which had been detailed by Michel Ganado in a previous testimony.

She continues and exhibits another letter of engagement from May 2016 where Bluestone asked PwC to review the workings of financial projections which was prepared for Vitals Global Healthcare by external advisors.

A fifth letter of engagement is dated 12 July 2016 addressed to Bluestone and governing a request for a high-level indication of the value of the concession.

A sixth letter of engagement from November 2022 was addressed to Steward, and PwC was requested to help update with projections.

Magistrate Montebello asks what these projections were used for, to which Pace Ross replies that these are future projections which the company would likely use for planning purposes or financing purposes. 

Pace Ross says that she did not work on these projections herself.

12:46: We’re getting towards the end of today’s sitting – it’s meant to finish at around 1pm.  Magistrate Montebello asks whether there’s two witnesses left but prosecutor Rebekah Spiteri says there’s another 10 witnesses left – drawing gasps.

The cross examination of the witnesses is what has set us back, having taken longer than expected.  Magistrate Montebello runs through the witnesses summoned seeing if any would take long but it doesn’t seem like it.

Two representatives from PwC will definitely testify today – whether anymore witnesses will be heard after will remain to be seen.

12:41: Lawyer Jason Grima asks about the MoU and whether Ganado Advocates felt that it impacted the RfP process, but Cremona says he doesn’t want to give a legal judgement and the matter is addressed in the legal advice that the law firm gave.

Cremona’s testimony ends there and he steps off the witness stand.

12:36: Galea now angles his questions on the MoU and asks whether the law firm had given advice to exclude anybody from the tendering process based on this MoU.

Cremona says that it was the law firm’s opinion that the fact that there was an MoU on part of the concession it might give reason for appeal from some private operators on the basis of the wholeness of the tender process.

Galea says but that the law firm never gave advice for a bidder to be excluded because of this MoU. “We didn’t, but that’s not how it works,” Cremona replies. “There has to be an equal race in the market,” he says.

Lawyer Edward Gatt now asks the questions.  He asks whether the police had ever spoken to him about the case and about what he had testified about today in court, to which Cremona says that neither he nor his team had been summoned by the police.

12:29: Magistrate Montebello and De Marco now get into an argument over one of the lawyer’s lines of questioning.

De Marco accuses the magistrate of not letting the witness finish a sentence.  The sentence in question concerns Ganado Advocates being engaged in the arbitration proceedings between Steward and the government.

Her questioning ends and Vincent Galea now takes over.

“Was there ever any advice that Joseph Muscat did not take or if you ever had any contact or instructions from him,” Galea asks.

“I never met him and I don’t believe my team did.  So no, from February to July as long as we were engaged we never met Muscat,” Cremona replies.

Galea asks for a set of documents which Cremona says that he will exhibit in the next sitting.

“Did anything illicit come to your attention,” Galea asks. “No there was nothing illicit, but it was too rushed,” Cremona replies.

Galea asks whether Cremona was involved in the magisterial inquiry process, to which Cremona says that they had never been asked to testify or present evidence.

12:14: Gianella De Marco now takes over the questioning, cross-examining the witness.

She asks how many letters of engagement the law firm had, to which Cremona says there was just the one. The first task in it was to give legal advice on this procurement process, which also developed to be within the context of an EU directive.

Did Projects Malta take the advice onboard, De Marco asks. Cremona says that there was never any formal correspondence to directly say that the advice was being taken onboard, but the fact that a tender was issued means that the advice was taken onboard.

De Marco suggests that the law firm was aware of the 2014 MoU, but Cremona replies that on 12 February 2015 Mifsud Bonnici had sent a powerpoint presentation on the concession and on 15 February 2015, two documents were sent by email to the firm, one which contained an unsigned position with the letterhead DF Advocates – Cremona isn’t sure who they were representing – and the MoU, by Mifsud Bonnici.

De Marco suggests that the MoU was considered by Ganado Advocates in its legal advice to Projects Malta and when asking for advice from abroad, a suggestion that Cremona agrees with.

12:05: Cremona says that the law firm was never involved in the adjudication of the tender or evaluation of its bidders.  The firm did draft the Services Concession agreement however. The firm also gave input on a Labour Supply Agreement, although Cremona says it wasn’t his team involved.

The law firm was engaged by Projects Malta and Aron Mifsud Bonnici was the “instructing counsel” to Ganado Advocates.

11:59: Cremona says that at this time an EU directive with regards to procurement that was implemented and so Ganado Advocates had engaged an Irish law firm – Arthur Cox – and a partner, Patrick McGovern, had given advice on it in order to ensure that the process was in line with the new directive.

He says that Mifsud Bonnici had given a presentation to the law firm about the procurement process, outlining it.

Cremona says that as long as the law firm was involved in the process “there was always a sense of urgency” with regards to the project from different people involved in it.

11:46: Antoine Cremona, a partner at Ganado Advocates, is the next witness to take the stand.

Cremona explains that the law firm gave legal services between 5 February 2015 and 24 July 2015 – which was the last date that the firm did anything “substantial.”  The engagement was with Projects Malta.

The first phase of their engagement was led by lawyer Stephen Attard, who was approached by Aron Mifsud Bonnici to see whether the firm could assist on foreign investment in the health sector.  Attard then introduced Mifsud Bonnici to Cremona and his team.

February was a phase of understanding the project and giving advice on the legal framework which was needed, he says.  “Our conclusion was almost immediately that the process needed a competitive procedure in the open market,” Cremona says.

A bit later, at the start of March, the law firm received points that needed to be included in the RfP from Mifsud Bonnici.  Nobody directly said that the advice to go for a public tender had been taken, but the firm was simply sent these points, Cremona continues.

Magistrate Montebello asks specifically about the services sought from them, and Cremona replies that the firm had been asked for legal advice in how to handle this potential foreign investment.

11:38: Lawyer Jason Grima is asking the questions next.  There is a brief pause as Ganado asks for a glass of water, which is provided by a court attendant.

He asks whether Ganado had testified in the magisterial inquiry, and whether anybody from the police had spoken to him about the RfP or MoU.  Ganado replies in the negative to both.

He continues that PwC’s involvement with VGH was limited to tax advice and financing, but had nothing to do with auditing.  Grima asks whether he knew that VGH had not carried out any audits, to which Ganado replies that he knew from the press but auditing was not within his remit.

Grima asks what happened when the concession flipped over to Steward, to which Ganado says that PwC then had a different mandate.  Grima asks what PwC’s role with Steward was, but Ganado says that he wasn’t personally involved so he cannot speak about it.

PwC had no say whatsoever in VGH’s audits, it emerges from some back and forth questioning.

That brings Ganado’s testimony to an end and he steps off the witness stand.

11:32: The magistrate suggests that there must have been working documents or written advice which PwC gave to the client, but Ganado says that their deliverable was the four volumes which Bluestone ultimately presented to the government as part of the bidding process.

Galea wants the magistrate to order the witness to preserve documents related to PwC’s relationship with Bluestone – a request which the magistrate accedes to.

“I understand that the business plan you drafted with your client was realistic.  Yes or no,” Galea asks the witness. 

“I cannot say yes or no – at the end of the day, you are providing a service and it is to the best of your ability within the context of what your client is requesting,” Ganado says.

Galea is losing his patience with Ganado.  Magistrate Montebello asks point blank whether the business plan that PwC had helped Bluestone draft could realistically have been put into practice.

“At that point in time, yes,” Ganado replies. 

Galea asks whether the police had carried out any searches at PwC, to which Ganado replies in the negative, and the lawyer ends his questioning there.

11:24: Vincent Galea is now asking the questions again.  He asks Ganado to exhibit any documents with regards to the onboarding of Bluestone as a client.

Galea is now asking for certain documents related to billing, but Magistrate Montebello is chastising Galea trying to understand the line of questioning and why he needs these documents.  “How much PwC charged is not relevant to these proceedings,” Montebello tells Muscat’s lawyer.

There is more arguing between Montebello and Galea, which culminates in Montebello saying that she needs to control the parameters of the cross-examination.  She asks Ganado herself for his personal involvement with Bluestone.

Ganado replies that the first engagement was with regards to the MoU – and Galea asks Ganado to specifically detail what PwC did.

“To put forward a presentation you need to bring out the context of the situation, within the parameters of the government’s strategy on medical tourism.  We had to see how Barts were being involved in this process. To make a project like this sustainable it’s not just a question of investment infrastructure, but there’s also demand of where this medical tourism would come from – so there was a lot of research put in to see how this project could be made sustainable and relevant,” Ganado replies.

He continues that foreign experts from hospitals abroad came to see the site, and says that those two months were very intensive in the run-up to that presentation which was submitted to the government in mid-January 2015.

Then there was PwC’s involvement in the RfP later in 2015.  There were four volumes as part of this process.  “Our role wasn’t to invent things… at the end of the day we were project coordinators.  This was a two-month engagement involving a lot of people,” Ganado says.

11:14: Questions now shift to the submission of a bid in the procurement process: “We helped the client through project coordination services to prepare the bid submission,” Ganado says.

Vitals Global Healthcare as a company, to Ganado’s understanding, was incorporated “a day or two or a few days before the submission.”

In July 2015, Bluestone submitted a new letter of engagement for PwC to help when it comes to project financing and adjust the financial plan to be in line with any updates in the process.

He insists that PwC’s client was always Bluestone, and VGH was only a subsidiary of Bluestone.

Filletti asks what type of services were offered to the company.  “The nature of the services was for providing assistance in terms of the project financing – this was a time that they were in discussions with the bank on financing – and there were certain aspects on tax advice; at some point in time there was also an aspect where they appointed third parties in the UK who were providing financial assistance and we were asked to review the model of this UK company within the context of VGH,” Ganado replies.

11:09: Lawyer Stefano Filletti asks the witness what Bluestone was. “An investment company,” Ganado replies.

The lawyer asks whether Bluestone had any relationships with other companies, subsidiaries and so on.

Ganado is somewhat stumped by the question – he says PwC would have done due diligence on the company and the Ultimate Beneficial Owner.

Filletti asks whether Ganado knows about VGH Ltd, to which he replies that it was a company incorporated later “within the Bluestone structure.”

Filletti continues with the questions and asks about PwC’s involvement with Bluestone and VGH after the concession, but Ganado says he wasn’t involved in this and he has a colleague waiting outside with documentation on this.

The lawyer now shifts the questioning to the presentation of the business plan associated with the MoU. “We helped the client do a presentation in January 2015,” Ganado says.

“It was to the government and it was at Castille but I don’t really remember who was present. The scope of the presentation was to put forward Bluestone’s submissions on their ideas for the development of the Gozo Medical Complex,” he continues.

11:05: Vincent Galea is now asking the questions.  He asks whether PwC’s due diligence had drawn any concerns on Bluestone. “At the time there weren’t any [red flags],” Ganado says.

“NAO says your projections were too positive and from what I understand, were not realistic – was your business plan professional,” Galea asks.

“It was not our business plan – it was our client’s plan; our role was to help them put it together.  At the end of the day if infrastructural costs need to be put in by experts, our role wasn’t to validate them but it was to bring the plan together to create projections which were consistent,” Ganado replies.

There is some back and forth: Ganado says that the business plan was not PwC’s but it was ultimately the client’s.  It was not PwC which comes up with the amounts in the business plan, but the client.

“The RfP was a Bluestone-Vitals submission,” Ganado says.

11:00: Lawyer Gianella De Marco, who is representing Aron Mifsud Bonnici, is now running the questioning.

She breaks down what we’ve heard: PwC were engaged by Bluestone to draft a business plan for the Gozo medical complex, it was paid by Bluestone, and PwC was then engaged to help with the RfP afterwards.

“Was the RfP situation different to what was in the MoU,” De Marco asks.

Ganado hesitates for a moment and then says that the MoU was limited to Gozo and was time-barred. “The RfP was not for Gozo – it was a different thing completely – do we agree,” De Marco asks. “Yes,” Ganado replies.

“The MoU had then expired, so when you were presenting things for the RfP it was for something different and much wider, which required different things, so much so that you needed another engagement letter,” De Marco continues. “Correct,” Ganado replies.

Ganado says that Ram Tumuluri was the contact for Bluestone. De Marco asks Ganado how long he has been working in the industry, to which he replies that he has been working 36 years.

“And we agree that you never saw anything untoward during this whole process,” De Marco asks. “Agreed,” Ganado replies.

Nothing further for De Marco.

10:53: Ganado is asked about the MoU and whether he had seen it, to which he says that he personally had seen a copy of it after the company was engaged.

“I remember that it referred specifically to the Gozo Medical Complex and they had a time period to put forward a feasible business plan until mid-January 2015,” Ganado explains.

PwC was engaged again in April 2015 when the RfP was issued, and when Bluestone approached the company for help with the bid submission, Ganado continues.

PwC was always engaged by Bluestone Special Situations, Ganado says.

10:49: Michel Ganado, a management consultant at PwC, is the next witness to take the stand.

He explains that PwC’s involvement in the concession started in October 2014 when they were approached by the company Bluestone, which informed them that they had an MoU with the government to put forward a business plan by January 2015 for the development of a medical facility in Gozo.

Prosecutor Rebekah Spiteri asks who he had discussions with, to which Ganado replies that discussions were with Mark Pawley but the designated representative of the company was Ram Tumuluri.

The letter of engagement was in November 2014 and the company had two months to help Bluestone draft a business plan.  They had brought over doctors and architects from the United States to visit the site, and their input was inserted in the business plan, Ganado says.

10:45: “The experts make it seem like something illegal was written into the MoU – did he see something which bothered him,” Galea asks.

“No, no, no… nothing at all.  Absolutely not,” Cardona replies.

Galea asks Cardona whether he had received any pressure from Muscat for this MoU to be signed. “I never spoke about the memorandum with Dr Muscat or anyone else,” Cardona replies.

Galea asks why the MoU was then not followed up by the government. “It did not specifically address the plan that the government of the day have for the health sector,” the former minister says.

So why was it signed, the magistrate chimes in.

Cardona says that an MoU is a “preliminary non-binding agreement to test the waters.”  There has to be an understanding, he says, for things to be delivered by a group of investors.  “At this stage, I don’t think a proper due diligence would have been done – or maybe there would have been something, but not an enhanced due diligence,” he says.

Galea’s questioning ends there.  Magistrate Montebello asks a final question: whether Muscat was present when the MoU was signed. “If Muscat was present I’d have remembered,” Cardona replies.

His testimony ends there and the former minister steps off the witness stand.

10:41: Cardona is asked whether he had handled or signed any other documents related to the concession.

“No. Nothing. Zero,” he says. That includes the emphyteusis which Malta Enterprise had signed with Vitals.

Joseph Muscat’s lawyer, Vincent Galea, now takes over the questioning, cross-examining the former minister.

10:38: The MoU was signed represented by Mr Mark Edward Pawley in his capacity as Director of Bluestone Special Situation 4 Ltd, Dr Ashok Rattehalli in his capacity as Director of AGMC Incorporated, and Mr Mohammad Shoaib Walajahi and Mr Chaudhry Shaukat Ali in their capacity as Directors of Pivot Holdings Ltd.

Shaukat Ali has also been charged in connection with the Vitals magisterial inquiry.

Cardona says that the MoU was signed at Castille.  Was there a particular reason, Magistrate Montebello asks – there wasn’t, Cardona replies. He doesn’t remember who was present when it was signed but he does not believe there were any government officials outside of those from Malta Enterprise.

10:33: “I had no background,” Cardona says on the MoU that he signed.

“Not even of the investors?,” Magistrate Montebello asks.

“I didn’t even know who they were,” Cardona replies.

The MoU catered for the presentation of a business plan and a set of deliverables for Barts, the former minister continues.  He reels off a list of other MoUs that he had signed during his tenure as Economy Minister.

“I just read the memorandum and signed it,” Cardona says.

He is asked why he signed it if he didn’t know any background on it, to which he replies that he signed it because he was the minister responsible for Malta Enterprise.

Cardona says that the MoU was signed within the context of the government wanting to revamp the health sector and introduce the concept of medical tourism as well.  He says that the MoU refers specifically to the ‘Gozo Medical Complex.’

10:28: Cardona says that the memorandum was one of an amount of memoranda which he would sign as Economy Minister.  He says that he only put his signature on the memorandum, but recalls that Malta Enterprise – which was under his remit – and one of their clients was Barts.

He says that the idea of this MoU was for a business plan to be presented which was pegged to a set of deliverables.

Malta Enterprise, which was led by Mario Galea at the time, had simply approached him to sign the MoU.

“A lot of memoranda are signed but they do not go any further, like this one,” Cardona tells the magistrate, and adds that he has a whole list of memoranda that he had signed as economy minister which he can present.

“The memorandum wasn’t renewed – if I’m not mistaken, it was withdrawn by Malta Enterprise because after discussions it showed that it did not lead to what the government wanted,” he says.

Cardona explains that the MoU, for instance, only related to Gozo and therefore did not include anything about St Luke’s Hospital – which is not the direction the government wanted to go in.

10:23: Former Economy Minister Chris Cardona is the first witness of the day.

Cardona served as Economy Minister between 2013 and 2020, which was when he resigned from Parliament in the midst of arrests made in connection with the Daphne Caruana Galizia.

He had signed the Memorandum of Understanding between the government and a company owned by the same people behind Vitals Global Healthcare in 2014 before the same company won the hospitals deal.

The NAO had said that the fact that the government had signed an MoU on the hospitals deal prior to the issuing of the tender should have disqualified Vitals from the procurement proceedings.

Cardona says he has been summoned to testify specifically about this MoU, and asks to see a copy of the document as he takes the witness stand.

10:21: Magistrate Rachel Montebello has entered the court room and we can get underway.

10:12: Good morning and thank you for tuning in - the court sitting hasn't started yet, but the cast have taken their places, so it will only be a matter of minutes.