Tista’ taqra dan l-artiklu bil-Malti
The individual committee members of the indebted and scandal-ridden Għaqda Koperattiva tas-Sajd Ltd have been informed by way of a legal letter from the Cooperatives Board that they are being held personally responsible for any and all expenses related to the co-op’s upcoming liquidation.
The letter from a lawyer representing the government board received recently by all committee members confirms the fishermen’s co-op is now under liquidation and that its accounts are most definitely in the red, to the tune of over €100,000.
Furthermore, the Cooperatives Board has chosen the option to hold the individual committee members responsible for liquidation costs rather than all the cooperative’s members collectively.
This could be construed as an indication that an investigation conducted into the running of the cooperative has found specific fault with its leadership, but the government has so far ignored The Shift’s line of questioning.
The letter committee members have now received cites Chapter 442 of the Laws of Malta governing cooperatives. It makes specific reference to Article 100(10), which states: “As soon as a liquidation is started, the Board shall determine whether the assets of the society in liquidation are sufficient to cover all the costs of the liquidation, including the remuneration of the liquidator.”
The Article cited adds, “If the assets of the society are not sufficient for the above purposes, these costs, and these costs only, shall be payable by the members of the committee of management or by all the members of the society, as the Board may determine in each particular case.”
The Cooperatives Board’s choice to hold the committee of management, rather than the second option of holding all members collectively responsible for making good on liquidation costs, implies the investigation has laid culpability for the financial mess squarely at the feet of the committee members.
The auditors who contributed to the last annual report documenting GħKS’ most recent accounts, back in 2016, had already sounded the alarm bell by stating that “the financial declarations do not give a just and truthful account of the balance sheet”.
Further investigation of the data available has shown that the cooperative’s net worth was €108,326 in the red, which 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.
In August, the government’s Cooperatives Board concluded an eight-month investigation into the co-op, the results of which recommend the replacement of its executive committee.
While the Cooperatives Board had ignored requests from as far back as December 2016 to conduct an inquiry into the affairs at the GħKS, last January it finally 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 the GħKS, headed by individuals who have been arraigned for smuggling fuel and ammunition, was under investigation for having not submitted audited accounts for the last seven years.
GħKS’ secretary is alleged fuel smuggler Paul Piscopo, while its vice president, Michael Carabott, was handed a 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, is known to have access to the Labour Party’s top brass, including disgraced former prime minister Joseph Muscat, his disgraced former chief of staff Keith Schembri and current Prime Minister Robert Abela.
The Ministry for the Economy, Investment and Small Businesses, under whose remit the Cooperatives Board falls, has so far failed to answer The Shift’s questions about the liquidation process or the results of the investigation.
But this latest letter to committee members has at least confirmed that the liquidation process has now begun and that the inquiry has most likely blamed the dire financial situation on the cooperative’s management.
The Shift recently reported how fishermen have branded the whole process as a “bogus roadmap exercise” to see questionably-run co-op shut down and dissolved as quietly as possible.
In fact, fishermen speaking with The Shift have accused the board of quietly and rather surreptitiously dissolving the cooperative on the down low and that they were unaware of what was happening. They feel they have been misled and robbed of a chance to plot the co-op’s way forward for themselves.
In the cooperative’s last annual accounts, those of 2016, auditors had already expressed an extremely negative opinion on the state of affairs, having gone so far as to have outlined instances in which money that went into the cooperative could not be traced or located.
The auditors were clearly concerned about the cooperative’s financial situation, saying that they did not believe the accounts presented “a just and truthful account of the balance sheet”.
The list of GħKS’ creditors showed the majority of pending payments include the repayment of a €93,585 loan issued through the Department of Fisheries, VAT dues of €20,804 and missing National Insurance contributions amounting to a total of €5,225.
They also include around €100,000 in debt to commercial creditors and unpaid bills for Transport Malta and the Mediterranean Offshore Bunkering Company Ltd, among others.
That audit expressed concern about the “critical situation” that the cooperative would be in should it fail to recover its debts.