Former Attorney General Peter Grech defended his decision to not act in the face of major political scandals in recent years, such as the Panama Papers and Pilatus Bank, saying that his job as Attorney General was to simply ‘give advice’.
Grech was questioned by the judges of the board of inquiry looking into the assassination of journalist Daphne Caruana Galizia on Friday about his role and lack of action taken when presented with serious allegations of money laundering and corruption involving politically exposed persons.
“My job as an Attorney General was to provide advice when this is requested. Investigations are carried out by the police,” he told the court.
The judges were irked by the fact that Grech’s advice was sought on multiple occasions and he showed an unwillingness to take action.
“You did not feel the State needed to react to such a big story?” Judge Joseph Said Pullicino asked, referring to the Panama Papers scandal.
“When nothing happens, a system of impunity is created. You are one of the players who had the power to influence these decisions. Did you speak to the Minister [Konrad Mizzi] and Chief of Staff [Keith Schembri]?” he asked again.
Grech replied: “Investigations are the police’s job. The function of the Attorney General is different. An Attorney General gives advice when asked to do so”.
During a previous hearing of the testimony of former head of the Economic Crimes Unit Ian Abdilla, the court heard that Grech had advised the police to ‘tread carefully’ when the Panama Papers scandal broke in April 2016.
Former Minister Konrad Mizzi and former Chief of Staff Keith Schembri were never summoned by the police to be questioned about the Panama Papers.
“Panama Papers was an issue of tax evasion and it involved hundreds of people and they are not all in jail today. There was also a legal issue whether this was a case of money laundering or tax evasion or whether it was an issue of intent,” Grech added.
“But if you know that this is a possibility, you don’t look into it?” asked Said Pullicino.
“We are delving into details of investigations I don’t know about. The actual Panama Papers never arrived at the Attorney General’s office,” Grech replied.
He recalled correspondence he had with an official at the Ministry of Justice in Germany who had offered access to the Panama Papers. Grech said he had given this to the magistrate and they made the necessary arrangements.
Grech was asked about Nexia BT, the firm engaged by disgraced Minister Mizzi and Schembri to open accounts in Panama.
A blog post by murdered journalist Caruana Galizia in March 2016 had called on then-Police Commissioner Michael Cassar to order an investigation into the accountancy firm. The journalist had said that the documents on paper had already vanished and the police should go and get Nexia BT servers until an investigation is over.
Grech admitted that he told the police not to interfere in light of the fact that taking a company’s server is an “invasive measure”. “This was a drastic measure which basically causes the closure of an accountancy firm. I wanted to make sure that there is enough reasonable suspicion. This was my advice.”
He then went on to say that it was in his character to be ‘cautious’ and the advice that he had given to the police had been spun around and caused him ‘serious harm’.
Judge Abigail Lofaro asked how reasonable suspicion is determined, to which Grech replied that his job was to give legal guidelines and that he did not know what the police had.
Grech explained that he based his advice on what was presented to him through an FIAU report. When questioned by lawyer Therese Comodini Cachia, Grech said that he had ‘skimmed through’ the report or read its conclusions.
He said that the FIAU had requested the now-defunct Nexia BT to present any documentation adding that the Unit suspected there were more documents relevant to the case.
Nexia BT, he said, had defended its position that no more documents were presented because the rest of the arrangements with their clients, including Mizzi and Schembri, were verbal.
“The argument that these servers would have contained anything of importance is dubious,” he said.
The Panama Papers were not discussed in any of the meetings with the police.
During Friday’s testimony, Grech also confirmed that he had cautioned then-Deputy Commissioner Silvio Valletta not to call for a magisterial inquiry into Pilatus Bank if it was solely based on a blog.
“I had told Valletta that all we have is a blog and saw no reason for the police to raid the bank. I did not tell him not to act,” he explained.
This was the night when then Pilatus Bank owner Ali Sadr Hasheminejad was filmed walking out of the infamous bank following an article by Caruana Galizia which referred to a safe containing important documents in the kitchen of the bank related to the third Panama company Egrant. Grech said he had not been informed of what was happening at the bank.
On Electrogas, Grech said the government had engaged both with the Attorney General and private legal firms before anything was signed. Camilleri Preziosi was the private legal firm which, together with the Attorney General, acted as lawyers to the Finance Ministry.
“My job was to be present for any advice. The Finance Ministry would want the comfort of the Attorney General’s advice,” he said.
Leaked emails read out in court by lawyer Comodini Cachia showed that Ronald Mizzi, the permanent secretary at the Ministry run by Mizzi, was included in the email correspondences between the lawyers.
The email referred to an ‘updated opinion’ from the Attorney General. Grech said it was common practice to have the Attorney General’s advice changed when you’re going through international negotiations.
“An Attorney General’s opinion is there to confirm that things are in order and to avoid issues later on. The media presented it as some scandal. But this is normal,” he said.
Leaked emails had shed light on the Attorney General’s involvement in the controversial agreement of Electrogas. It was revealed that Grech and the newly appointed Attorney General, Victoria Buttigieg, were involved in a security of supply agreement that bypassed parliament.
Grech resigned last August this year.