Scandal-ridden fishing co-op dissolved in ‘bogus exercise’

Tista’ taqra dan l-artiklu bil-Malti

In what fishermen speaking to The Shift have branded a “bogus roadmap exercise”, the scandal-ridden Għaqda Koperattiva tas-Sajd Ltd (GħKS) has been quietly dissolved.

The ministry responsible for the Cooperatives Board has meanwhile chosen to remain silent about the long-coming development.

Fishermen speaking with The Shift have accused the board of quietly and surreptitiously dissolving the cooperative through a “bogus roadmap exercise” kept on the down-low, saying they were unaware of what was happening.

They feel that they have been misled and were robbed of a chance to plot the co-op’s way forward for themselves.

In August, the government’s Cooperatives Board concluded an eight-month investigation into the fishing co-op, the results of which recommend the replacement of its executive committee.

In January, the Cooperatives Board appointed an inquiry tasked with looking into GħKS’ finances and ensuring that the cooperative “conforms to all its legal obligations”.

In April, The Shift reported how GħKS, led by individuals who have been arraigned for smuggling fuel and ammunition, was under investigation over its failure to submit audited accounts for the last seven years.

The inquiry was concluded in August, with the Cooperatives Board confirming that it has “written to all the cooperative’s members to set up a meeting with them and establish whether there is any interest in the cooperative continuing to operate, preferably with a new executive committee”.

But documentation seen by The Shift shows correspondence with members made no mention of an intention to appoint a new committee or to dissolve the co-op.

First, the Co-ops Board sent a letter to GħKS members on 3 August calling for a meeting of members, simply stating it was “regarding your cooperative”.

It made no mention of the inquiry nor the intention to have the co-op dissolved. It was, according to fishermen, the first step in a premeditated “roadmap” to quietly close down the co-op and let those who have mismanaged its finances off the hook.

That letter said the meeting would last no more than an hour and that the date and time would be advised at a future date. It invited members to register their interest in the meeting by 19 August by telephone or email.

A second letter was sent out to members on 7 September announcing the Board’s decision to cancel the meeting since there had been a lack of interest in attendance from members.

But it wasn’t until the third letter, dated 8 November, that members actually learned what the original scuttled meeting was to have been about – to appoint a new leadership committee for the co-op.

But instead of having been fully informed of the importance of the meeting in earlier correspondence, members were informed of a fait accompli, with the Cooperatives Board closing the lid on GħKS’ coffin by blaming them for not attending the meeting and “in light of the board of inquiry’s conclusions”, on which members had not been informed.

They were told GħKS was to be dissolved as a result, and a liquidator was appointed.

Fishermen who spoke to The Shift described the process as a “bogus exercise” intended to close down the co-op with the least resistance. They insist that if even one member had expressed their intention to attend, it should have been held.

The setting of meetings, according to insiders, was one of the steps required by law that had to be taken as part of the liquidation process, but members were unaware.

They argue that perhaps members might have wanted to choose a way forward for themselves.

As matters stand, it is unclear how many had registered interest, and the ministry responsible – Silvio Schembri’s Ministry for the Economy, Investment and small businesses – has so far refused to answer the questions The Shift has raised.

GħKS was initially set up to directly negotiate the sale of fishermen’s catches and export their products, while the Cooperatives Board is the official government entity serving as regulator and administrator for all cooperatives registered in Malta.

The Cooperatives Board in January established an inquiry tasked with looking into GħKS’ finances and ensuring the cooperative “conforms to all its legal obligations”.

GħKS’ secretary is alleged fuel smuggler Paul Piscopo. Its vice president, Michael Carabott, was served with a year-long suspended sentence in January 2017 after he was arrested with three Egyptians who were found in possession of 50,000 rounds of ammunition, according to court documents.

The cooperative’s president, Joseph Demicoli, has access to the Labour Party’s top brass, including disgraced former prime minister Joseph Muscat, his disgraced former chief of staff Keith Schembri and even current Prime Minister Robert Abela.

The auditors who contributed to the annual report documenting GħKS’ most recent accounts had already sounded the alarm, stating that “the financial declarations do not give a just and truthful account of the balance sheet” of the cooperative.

Further investigation of the available data has shown that the net worth of the cooperative stood at €108,326 in the red, which essentially means that even if it does manage to recover the debt it is owed, there would not be any liquidity with which to pay creditors.


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1 month ago

How much cash went down the Laundry drain?

1 month ago

Like every other “business” on this rock, it’s Mafia controlled, therefore no action, no information, no money, no repercussions, Omerta in action.

Gaetano Pace
Gaetano Pace
1 month ago
Reply to  Mick

Typical business as usual. All institutions are working, on indeed in reverse.

MA Caruana
MA Caruana
1 month ago

While the auditors were highlighting wrongdoings and giving adverse opinions, year after year, the Cooperatives Board kept looking the other way. The statutory reports, reaching their office up to Financial Year 2016, were most likely instantly put away to collect dust. Ostensibly so, considering that the Board ignored requests, as early as December 2016, to conduct an inquiry into the affairs of the Ghaqda Koperattiva tas-Sajd (GKTS).

All of this happened at a time when the local media was awash with titbits about state and EU funding that must have vanished into thin air, and while top officials were named in alleged fuel smuggling activities.

Had the Cooperatives Board looked into the financial statements, they should have acted differently. Would you not scream if the average yearly turnover were €20k, while debtors and creditors fluctuated exponentially into hundreds of thousands? Was it in vain that the auditor was consistently giving an adverse opinion while exposing serious shortcomings? Comparing the accounts of GKTS against those of a much bigger fishermen co-op (KNS) would highlight stark differences that make particular GKTS accounting figures look very suspicious.

Is the Regulator trying to hide and bury awful deeds and letting crooks off the hook?

Can the Cooperatives Board confirm whether the GKTS has been used as a launderette?

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