The Malta Independent on Sunday
Keith Schembri among eleven charged with money laundering, remanded in custody
• Former OPM chief of staff pleads not guilty
Former OPM chief of staff Keith Schembri spent the night in jail after he was denied bail xafter being charged with corruption.
Schembri was among eleven people who were charged with corruption, fraud and money laundering. The group included
Schembri’s father, Alfio Schembri, business associates Malcolm Scerri and Robert Zammit, and Nexia BT officials Brian Tonna and Karl Cini.
The arraignments come following the conclusion of a magisterial inquiry into allegations that Schembri paid Hillman some €650,000 in bribes between 2011 and 2015. The payments are thought to have been routed through offshore companies and accounts, to Hillman’s BVI registered company, Lester Holdings. Schembri’s Kasco Group had previously won a competitive tender to supply Allied Group’s Progress Press with its new multi-million-euro printing press in 2010.
Schembri was in the second group of people to be arraigned. Magistrate Charmaine Galea read out the charges as the four – Schembri, his father, Zammit and Scerri – were led to the dock. A number of companies, including Kasco Ltd and several offshore companies were included in the list.
All four of the accused were charged with money laundering, complicity in an offence that carries a prison term, and fraud.
Keith Schembri and Scerri were also accused of corruption, while Keith Schembri was charged alone with forgery.
The court upheld a request from the prosecution for the assets of the accused to be frozen.
Lawyer Edward Gatt requested bail but the prosecution objected. “The prosecution cannot confirm whether offshore companies are still operating. Some of the accused are very close to third parties who are still under investigation,” lawyer Mercieca Rizzo, from the Office of the Attorney General said.
“Do we agree that they cooperated fully with the investigation?”, Edward Gatt asked. The inspector replied in the affirmative.
Gatt asked about the inquiry led by Magistrate Natasha Galea Sciberras which investigated claims that Schembri had received kickbacks from the sale of Maltese passports under the IIP scheme. The inspector said that in that inquiry, the magistrate had concluded that there was no prime facie evidence against Keith Schembri.
Answering questions by Gatt, the inspector said that Keith Schembri was “very talkative” and had to be reined in at times. The police would stop him to tell him they are asking on something else.
Superintendent Frank Tabone spoke about the decision to grant police bail. This was because investigations were ongoing and because one can only keep a person under arrest for 48 hours.
Gatt said that the men have everything in Malta and have no reason to leave the country. “These people have everything in Malta. Their families, assets, their life. What is society going to gain by keeping these people under arrest? Here you have a case where the evidence is all documentary and preserved. If they are given bail today or next week, next month what is the gain? The denial of bail must be based on reality not the hypothetical”, he argued.
“They have been participating in the inquiry for years. Would they wait for the conclusion of the inquiry and to be arraigned to abscond? The predicate offence is the starting point. The date mentioned by the inspector – 2010 – means the predicate offences are apparently time barred,” Gatt noted.
“This is the justice of Keith Schembri… Smoke and mirrors. Now he has been charged, let justice take its course. The same police who decided to give these men police bail are now objecting to their release from arrest”, he continued in a raised voice.
Mercieca Rizzo rebutted: “Shouting doesn’t make your point any more convincing. The crimes are here and so are the charges. None of them are time barred and had been given prima facie by magistrates. The prosecution is not here on a whim. This is not the ‘justice of Keith Schembri’. It is the same justice for all,” Mercieca Rizzo insisted.
Magistrate Galea then denied the bail request and the accused were taken to the Corradino Correctional Facility.
Nexia BT
The first to be charged were Nexia BT’s Brian Tonna, his daughter Beverly Tonna, Karl Cini, financial controller Katrin Bondin Carter and auditor Manuel Castagna.
The court said that the defendants are accused of money laundering: Cini and Tonna alone are accused of conspiracy. Cini, Tonna and Castagna are accused of giving false information to a public official, as well as fraud. Cini and Tonna are also accused of forgery. All four pleaded not guilty to the charges.
The prosecution was whether it could quantify the amounts related to the charges at hand. Lawyer Elaine Mercieca Rizzo from the Attorney General’s Office said she could not give a single specific amount, but that she can say that it “greatly exceeds half a million euro”. The court upheld prosecution’s request for a freezing order, and ordered the freezing of all the accused’s assets. They can only access just over €13,000 of their funds, as is standard procedure in money laundering cases.
After a lengthy debate, Magistrate Charmaine Galea denied their request for bail. She ruled that the crimes which they are accused of are extremely serious and that because their status has now changed from being suspects to being accused, she was not assured that they might not try tamper the evidence or flee if they do get bail.
Tonna, Cini, Castagna, and Bondin Carter were then taken to the Corradino Correctional Facility.
Other arraignments
The next round of charges were filed against Lorraine Falzon and Matthew Pace, who are also accused on behalf of Zenith, which was previously named MFSP. The charges include money laundering, making a false declaration to a public authority, forgery and complicity in a criminal act. Both pleaded not guilty. A freezing order was issued in this case as well.
Bail was denied.
The last person to be charged was former Allied Group director Vincent Buhagiar. He was charged with money laundering, conspiracy to commit a crime, making false declarations to Malta Enterprise, Bank of Valletta and customs, fraud and corruption. He pleaded not guilty.
The court issued a freezing order over his assets. Replying to questions by his lawyer, the prosecution said the investigations with regard to Buhagiar are not ongoing, but they are ongoing with regards to third parties.
The court was also told that Buhagiar is scheduled to go to hospital for an operation at the end of this month. The defence added that Buhagiar is an elderly man vulnerable to COVID19, which is “rampant” in prison.
She stresses that the crime attributed to Buhagiar is not those of the previous arraignments.
Buhagiar was granted bail.