Legal problems connected to disgraced former Prime Minister Joseph Muscat’s right-hand man Keith Schembri and his collaborators are expected to get more complicated in the coming days as another inquiry, the second out of three started in 2017 and 2018, is about to be concluded.
The Shift is informed that Magistrate Josette Demicoli, who in May 2017 was tasked with investigating alleged money laundering and graft activities between the former Managing Director of Times of Malta Adrian Hillman and Keith Schembri, is in the final stages of her assignment and is expected to communicate her conclusions to the Attorney General for possible action.
Schembri was under arrest and facing police interrogation, although he was released on police bail on Tuesday night after some 20 hours.
In May 2017, in the midst of the early electoral campaign called by Muscat, then-PN leader Simon Busuttil took eight box files to the court which he said included all the necessary proof that Schembri – the owner of Kasco Ltd – had passed €650,000 in kickbacks to Hillman, the former managing director of Allied Newspapers, publishers of The Times of Malta.
The allegations were first revealed by assassinated journalist Daphne Caruana Galizia and then supported by documents revealed in the Panama Papers.
The alleged kickbacks and graft took place between 2011 and 2016 when The Times of Malta invested in a new €30 million printing press procured from Kasco Ltd. The Times of Malta also bought all its printing supplies, costing millions, from Schembri while he was operating from Castille.
In the box files presented to court, now forming part of the inquiry, Busuttil claimed that Schembri used bank accounts in Switzerland and Gibraltar, as well as the now-infamous Pilatus Bank, to pass the money to Hillman directly or through his secret company Lester Holdings, opened in the British Virgin Islands by Brian Tonna of Nexia BT.
Both Hillman and Schembri have denied the allegations. An internal investigation commissioned by Allied Newspapers has never been made public.
At the same time, the board of directors of Allied Newspapers, who had approved Hillman’s plan, had failed to involve the police into their probe, even after the surfacing of fresh claims made by the former Opposition leader.
The Times of Malta had made an out of court settlement with Hillman after the latter filed claims of unfair dismissal against his former employer. No details of this ‘deal’ were ever revealed by the newspaper.
In the meantime, the new printing press has been shut down and its workers made redundant due to heavy losses incurred. The printing of its own newspapers has been subcontracted.
A third inquiry, also prompted by Busuttil, is still in progress.
In September 2018, Magistrate Charmaine Galea was tasked with inquiring into possible money laundering and criminal activities by former Energy Minister Konrad Mizzi and Schembri, after revelations made by Reuters and The Times of Malta over the ownership of 17 Black and the Electrogas power station.
It was alleged that Yorgen Fenech, the owner of 17 Black, had made arrangements to pay €5,000 a month to the Panama companies owned by Schembri and Mizzi.
These companies were opened for the two Politically Exposed Persons by Tonna and Karl Cini, together with a third company called Egrant.
The latter was the subject of a different inquiry – the terms of reference set by Muscat himself as the subject of the inquiry after Caruana Galizia reported it belonged to his wife, Michelle. The outcome has been criticised by top legal experts.
The Magistrate who conducted the inquiry on Egrant, Aaron Bugeja, was promoted to Judge soon after the outcome that absolved the former prime minister and his wife from any wrongdoing.
The inquiry never determined who the actual owner of Egrant was, while Tonna announced it was his. According to the inquiry, Egrant was dissolved in 2017.