Court revokes garnishee orders against Kasco Holdings and Josette Schembri Vella

A Maltese court has revoked garnishee orders imposed on Josette Schembri Vella and Kasco Holdings (owned by her husband) after ruling that the measures had lapsed because the statutory deadlines for their renewal had expired.

Since no application for the renewal of the garnishee orders had been made by the responsible authorities, Madam Justice Edwina Grima issued the ruling following what court records describe as “urgent” applications filed by Schembri Vella, who argued that the orders were no longer legally valid.

The court accepted the argument that the seizure orders had exceeded their applicable time limits and had not been renewed, resulting in their revocation.

The court did not allow third parties to access the files, but sources have confirmed the Judge’s decision through documentary evidence.

The decision concerns two separate proceedings.

One application (Rikors) filed by Schembri Vella (90/2020) related to The Attorney General vs Kasco Holdings, one of several companies owned by the former chief of staff to ex-prime minister Joseph Muscat, Keith Schembri, the husband of Schembri Vella, when the cases under investigation occurred.

Another application (Rikors) she filed (23/2021) to have the garnishee orders ruled invalid concerned The Attorney General vs Josette Schembri Vella.

A garnishee order is a legal measure in which a court freezes a debtor’s funds to satisfy a claim – an asset freeze to pay debt.

Seizure and freezing orders are precautionary measures used by the courts to prevent individuals or companies under criminal investigation from disposing of assets that could ultimately be subject to confiscation if a conviction is secured.

Under the Proceeds of Crime Act and related legislation, such orders must comply with procedural requirements and are subject to periodic judicial review.

The ruling does not amount to an acquittal or a determination on the merits of any underlying criminal proceedings.

Keith Schembri, once one of the most powerful figures in the Labour administration led by Joseph Muscat between 2013 and 2019, has been the subject of multiple criminal investigations and prosecutions in recent years.

He is among a group of former senior officials and businessmen facing charges linked to alleged corruption, bribery, money laundering and criminal association arising from the public hospitals’ concession awarded to Vitals Global Healthcare and later transferred to Steward Health Care.

In 2024, a magisterial inquiry led to charges against Muscat, Schembri and several other former officials and associates, all of whom have denied wrongdoing.

Schembri has also faced separate proceedings related to the Electrogas power station project, where investigative reports showed that he played a central role, as well as allegations concerning kickbacks linked to the sale of Maltese passports, and financial crimes investigations stemming from revelations in the Panama Papers, which exposed offshore companies owned by Schembri and former minister Konrad Mizzi.

Muscat resigned as prime minister in 2019, eventually leaving office in January 2020, amid weeks of citizen protests.

Muscat, Schembri and others charged in the various proceedings have denied any criminal conduct.