Magistrate Charmaine Galea has denied bail requests from disgraced former Chief of Staff Keith Schembri, his father Alfio Schembri, Kasco Group CEO Malcolm Scerri and Robert Zammit after they were charged with money-laundering, criminal conspiracy, accountancy crimes and fraud.
Keith Schembri faces additional charges of false testimony and falsification, while Zammit has also been charged with breaching accountancy obligations. All four pleaded not guilty to the charges against them.
Zenith (formerly MFSP Financial) shareholders Lorraine Falzon and Matthew Pace were charged in a later session, both pleaded not guilty to charges of money-laundering, making a false declaration to a public authority, accountancy law breaches and criminal conspiracy.
The charges came after Brian Tonna, Karl Cini, Manuel Castagna and Katrin Carter Bondin from now-defunct financial services firm Nexia BT were arraigned in court on money-laundering charges earlier this evening.
Tonna, Cini and Castagna were also charged with submitting false declarations to authorities and fraud. Tonna and Cini are additionally accused of giving false statements to the court. All four pleaded not guilty to the charges. Magistrate Charmaine Galea refused their request for bail, meaning the accused will be held under preventative arrest until their cases come to trial. Freezing orders were issued against the accused.
The last individual to face charges was one of the former Managing Directors of Allied Newspapers, Vince Buhagiar. He stands accused of fraud, money laundering and criminal conspiracy, as well as making false declarations to Customs and Malta Enterprise.
This comes after Malta police said earlier today Schembri and 10 other individuals were to be arraigned before Magistrate Charmaine Galea later the same day. Malta police said in a statement charges will also be made against 20 companies.
The charges are related to the conclusion of a four-year inquiry by Magistrate Josette Demicoli looking into accusations that Schembri bribed former Allied Group Managing Director Adrian Hillman to award a multi-million euro contract to his company. The former right-hand man of disgraced former Prime Minister Joseph Muscat said on Thursday in a public Facebook post that he was expecting to be charged imminently.
The inquiry was launched in 2017 at the request of then-Opposition Leader, Simon Busuttil, after police failed to act on the findings of an investigation into the deal carried out by Malta’s anti-money laundering agency, the FIAU. Assassinated journalist Daphne Caruana Galizia first reported on the alleged crimes in March 2016.
Schembri and several other individuals were seen entering the Economics Crime Unit building in Hamrun on Saturday morning, where they are believed to have been questioned ahead of their arraignment in court. Schembri’s lawyers, Edward Gatt and Mark Vassallo, were also seen entering the building.
Brian Tonna, managing partner of now defunct Nexia BT and MFSP Financial (now trading under the name Zenith) shareholders Lorraine Falzon and Matthew Pace were among those questioned in Hamrun this morning.
Hillman is reported to be in the UK and attempts will be made to return him to Malta via the post-Brexit UK-EU Surrender Agreement.
Lawyers Charles Mercieca and Gianluca Caruana Curran were among those seen entering the ECU building. The two lawyers are defending the suspected mastermind in the murder of journalist Daphne Caruana Galizia, Yorgen Fenech.
Josette Schembri, Keith Schembri’s wife, was also seen entering the building, along with Kasco Group’s CEO Malcolm Scerri and former Allied Newspapers Director Vince Buhagiar.
Earlier this week, The Shift revealed that both Hillman and Schembri were expected to be arraigned in court to face charges of money laundering and graft. Via his Facebook post, Schembri revealed the conclusions of two magisterial inquiries that have so far been kept under wraps.
Schembri’s Facebook post may have been intended as a distraction to deflect attention away from his filing of a Constitutional case asking the court to declare as a matter of urgency that the inquiry concluded by Magistrate Demicoli be declared null.
At the start of the inquiry in 2017, Busuttil and his colleagues were filmed entering the law courts to present eight box files of evidence they said showed “a textbook case of money laundering.” The Labour Party labelled it a ‘charade’ and dismissed the box files as “empty”.
In a statement, the Daphne Caruana Galizia Foundation welcomed the news of the Schembri’s arraignment and said the move “is overdue,” given Caruana Galizia “revealed the money laundering and kickback scheme on 11 March 2016.”
“The failure to prosecute Schembri five years ago allowed him to commit crimes related to Daphne’s assassination and her investigative work,” the Foundation said in its statement. “Prosecuting Schembri today brings us a step closer to a Malta where no-one is above the law.”
Additional reporting by Caroline Muscat