Keith Schembri to face trial: Inquiry says he pulled the strings, made millions

Witness says €18 million a year was going to a group including Keith Schembri, Konrad Mizzi and Joseph Muscat from the concession

 

The trial against those accused of bribery, fraud and money laundering concerning the hospitals’ deal will proceed, according to a court decree on Tuesday by Magistrate Rachel Montebello who declared there was sufficient evidence against those previously at the helm of government.

The decree was based on the magisterial inquiry, following a four-year investigation, which details the involvement of the main players in a “fraudulent deal” that was not in the public interest. The court annulled the agreement last year on the basis of fraud.

Among those accused is disgraced former OPM chief of staff Keith Schembri. Despite claiming to have cut ties with his personal businesses when he was made chief of staff at the Office of the Prime Minister, Keith Schembri went the extra mile to make money from the hospital concession in every conceivable way, investigators found.

He pulled the strings and kept everything under his control, profiting from services to the concession and creating business ventures for himself (although his ownership remained concealed).

From cancer treatment facilities to catering, from renting out properties to spending tens of thousands of public funds on reputation management, investigators concluded that Schembri took the public for a ride with the help of enablers.

‘A concealed owner’

The magisterial inquiry concluded: “Schembri was central to all decision-making on the Share Purchase Agreement (SPA) with Steward and the aftermath of the transfer. He even had input as to which VGH creditors should be paid. His involvement seems to us more in keeping with a concealed owner than an officer of the Government of Malta.”

The magisterial inquiry notes that Schembri had “a long history of using offshore companies and bank accounts”. Brian Tonna and Karl Cini of the now-defunct Nexia BT assisted him in setting up the companies.

Schembri continued to use these offshore assets during his time as chief of staff of disgraced former prime minister Joseph Muscat.

The inquiry describes Schembri’s role as a puppet master, with former minister Konrad Mizzi as a sidekick riding the bandwagon. Even Muscat may not have been fully aware of Schembri’s dealings at the time, investigators noted.

Yet Shaukat Ali told Kamal Sharma (a former director of Accutor AG that was sending payments to Joseph Muscat) that Mizzi, Schembri and Muscat were in the concession deal with both VGH and Steward and that €18 million a year was going to that group from the concession, the inquiry report states.

A finger in every pie

Through several companies that he set up and controlled, although never quite officially showing his stake, Schembri profited from services the hospitals required.

Investigators concluded that he also used taxpayer money to set up new business ventures in the medical sector, like Cannapharm, focused on medical cannabis that was fronted by a Russian.

The inquiry reveals a network of enablers working with Schembri to profit from the hospitals concession. Their names keep appearing in the magisterial inquiry, such as Ivan Vassallo and Adrian Hillman (during his time as Managing Director of Allied Newspapers, which publishes The Times of Malta).

One such company was Eurybates, which, on paper, was owned by Ivan Vassallo of Technoline (which he also did not really own, according to investigators). Investigators concluded it was a vehicle for kickbacks.

In the six years between 2016 and 2021, Eurybates derived around €1.9 million in what were most likely kickbacks from four businesses that were major suppliers to the concession, investigators concluded.

“This income was under the guise of providing consultancy and administration services and was earned seemingly without the necessary personnel to deliver what could only be described as highly technical services, which in some cases were supported by backdated contracts drawn up by Mr Vassallo.”

Apart from the income derived from these companies, Keith Schembri’s companies Kasco Foods Ltd and Kasco Engineering Ltd, gained lucrative contracts to supply goods and services to the catering companies supplying the concession and other hospitals through Malta HealthCare Caterers Ltd. The contracts were valued at €1.5 million a year.

Investigators concluded that while Schembri profited from all this, he controlled the strings, even deciding on hospital board members that would support decisions being taken.

The inquiry mentions Impaqt Ltd, for example, that was charging Eurybates (another of Schembri’s hidden companies) €6,000 to €9,000 per month between March 2019 and July 2020.

The inquiry states: “This is significant because Schembri’s Kasco Engineering provided finance of around €80,000 to fund Impaqt, and the data reveals that Kasco was initially in control of the company.”

It provided engineering consultancy services to the health and energy ministry (then under the control of Konrad Mizzi). Impact added a 44% markup on invoices to the ministry, according to investigators.

These contracts generated over €500,000 in sales in its first 20 months, which was billed to the hospitals prior to the concession being awarded.

Investigators noted that as journalists were revealing fact after fact, Schembri spent tens of thousands of taxpayer funds to “manipulate online records of what the press was revealing about him and Konrad Mizzi”.

                           

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cikku
cikku
20 days ago

from what i have heard, KS whilst Chief of Staff, used to get his finger in every business proposal passing through the OPM. he would involve his friends to act on his behalf. aparently some very good business ideas being introduced never made it because the proponents did not want KS or his minions involved.

viv
viv
20 days ago
Reply to  cikku

That is standard Mafia practice.

M.Galea
M.Galea
20 days ago

Keith kien l filogu ta kollox, business man mil kbar u ghalhekk iffiltra gewwa kastilja mil l ewwel gurnata jirvinta l business ghalih u ghal Konrad, Joseph u Cardona w finalment Abela! U l poplu gifa haseb li qed jahdmu ghalih u ghal pajjiz! Dawn huma n nies li fottew pajjiz min kull angolu nkluz l bini li kollha iffiltrati f dan s settur! Ghalfejn tahseb li bidlu l-karattru ta kullhadd jorqod u jqum jahseb biss fuq loan u kantun??Imma l-poplu ma jistax jifhem! Finalment il-ministri l ohrajn ghamlu bhalhom u thamgu biex jakwistaw eluf jekk mhux miljuni jinhbew wara isem l izviluppatur u l business man u kullhadd igawdi mil l istess kejk! Imma nerga nghid il-poplu ma indunax u niddubita jekk ghadux stenbah!! Kieku hawn nies sura dal partit ilu li spicca w nemmen li l-PN mhux differenti!

Evelyn
Evelyn
20 days ago
Reply to  M.Galea

Ghalfejn dejjem tridu ddeffsu l-PN? Hemm xi hadd minnhom qed jigi investigat? Sa fejn jaf kulhadd, il-PN inghataw ragun mil-qrati fuq l-inkjesti li infethu, Jew ma tafux bihom? Iva, il-PN hafna differenti. Thallatx il-hass mal-qarabali.

Caesar
Caesar
19 days ago
Reply to  M.Galea

Alla jharisna min daz zibel, jigu min fejn jigu. Habs halli jitghalmu darba ghal dejjem.
Muscat, Kasco u Conrat huma l percimes. Mafia.

carlos
19 days ago
Reply to  M.Galea

tinsiex lill-gosef il-korrott – sahansitra tawh ukoll id-diploma ta’ akbar pm li qatt rat Malta

GEORGE CREMONA
GEORGE CREMONA
19 days ago
Reply to  M.Galea

Sur Galea mhux ghax il PN hu minghajr difetti jew zbalji. Hi maghmul mill bnedmin li huma mis sema ‘l isfel fejn hadt mhu perfett. Imma altru zbalji u mperfezzjonijiet umani u altru hazen, hnizrijiet pjanati bhalma hija l famuza road map.
Tista sur Galea x’qatt ghamel il PN minn dan kollu li jgeghelek temmen li huwa ‘l istess?

J.Degabriele
J.Degabriele
19 days ago

What kind of monster will siphon off money from cancer sufferers to enrich himself even more? In Maltese there’s a saying: Jekk m’hemmx infern, jinholoq ghalih!!t

Ted
Ted
18 days ago
Reply to  J.Degabriele

These kind of people are ethically impaired and morally bankrupt. They have no conscience what so ever. They are frauds !

carlos
19 days ago

nahseb li this skuzi ta bniedem
huwa missier il-hniezer ghaliex jidher li qatt m’ghandu xebgha u li kien lest jiffanga anke minn fuq il-morda. isthi jekk taf u tinsiex tehodhom mieghek.

Carmelo borg
19 days ago

Dan kollu GIDEB HUX HEKK GAHAN LABURIST U ALLA IBIEREK IL PRIM KORROT U IL GRUPP PARLAMENTARI DEJJEM APPOGAWH

Redneck
Redneck
19 days ago

All this from one large contract. We are also awaiting the outcome of the Powerstation Inquiry. We should also look at other large contracts where Mizzi was involved. Airmalta? And what about the roads contracts?

Orchard Road
Orchard Road
13 days ago

Whoever is found guilty should pay back the money plus interests and a real heavy fine. That’s where it hurts most !!

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