Tuesday

26th Mar 2019

Opinion

How the Maltese government targeted me for defending rule of law

  • Panama Papers leak first exposed high-level corruption in Malta (Photo: Daphne Caruana Galizia)

After the assassination of investigative journalist Daphne Caruana Galizia last year, I have been at the forefront in calling for justice and the restoration of the rule of law in Malta.

I do this because Caruana Galizia would not have been killed if Malta's institutions were functioning as they should and no journalists will be safe until they do.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

  • European Parliament tribute to Caruana Galizia (Photo: European Parliament)

Financial crime can often be complex, but this story is relatively simple.

Two political operatives, Keith Schembri and Konrad Mizzi, the Iranian-owned Pilatus Bank, and an accountancy firm called Nexia BT, were exposed by the Panama Papers and by leaked reports from Malta's anti-money laundering agency (the FIAU) as being neck-deep in corruption and money laundering.

But rather than let justice take its course, the governing party suppressed the work of investigators to prevent Maltese law from being enforced.

Pilatus Bank is a case in point. Its short client list includes Kieth Schembri, the chief-of-staff of Malta's prime minister, and members of the ruling Azerbaijani regime.

A leaked Financial Intelligence Analysis Unit (FIAU) report shows how Schembri laundered illegal kickbacks from passports sold through Malta's citizenship-for-cash scheme.

I wrote well over 50 letters to Maltese, European, and international institutions concerning Pilatus Bank in view of the threat I felt it posed to Malta's financial services sector.

Action was only taken by the regulator when the bank's owner was arrested in the United States for a string of charges which, unsurprisingly, includes money laundering. He is currently facing a 125-year prison term on the basis of those charges.

But Nexia BT, the accountancy firm that worked in concert with Pilatus Bank and whose substantial transgressions are documented in the Panama Papers continues to operate in Malta with complete impunity.

Last month, I published a leaked report from Malta's FIAU. I did so because it had been buried and because the authorities that should have taken action were prevented from doing so.

The report concludes that police action is necessary against tourism minister Mizzi and shows how, through Pilatus Bank and Nexia BT, funds derived from corruption would be laundered.

The response of the Maltese authorities was to threaten me with arrest for publishing the report, but Mizzi continues to hold his post. Nexia BT continues to operate and receive lucrative government contracts.

And the criminal activity that could be in progress even today continues unabated to the detriment of the Maltese public.

Meanwhile, the Daphne Project was created after Caruana Galizia was assassinated in order to continue her work.

Daphne Project

This group of world renowned investigative journalists discovered that Schembri and Mizzi were planning to receive €150,000 per month into their once-secret Panamanian companies from a Dubai company called 17 Black.

We still do not know who owns 17 Black. But what is clear is that the kickbacks would have to result from a project big enough and with sufficient recurrent payments to make such cash flows possible.

Mizzi and Schembri were the driving force behind Malta's new gas-fired power station and a gas-supply agreement with Azerbaijan's state oil company that has seen Malta pay €40m annually above market rates for gas.

And yet it is I and others calling for accountability who have been labelled traitors deserving of punishment and it is they who would have us punished.

It is not a new narrative. It is what happens when institutions are captured, impunity flourishes, and corrupt politicians substitute themselves for the state.

This warped logic dictates that whoever speaks out against corruption is working against the state itself because the corrupt politicians have become the state.

And how are we traitors punished?

The first stage is to use the threat of lawsuits. In the past few months, I have been publicly threatened by both the FIAU and by Schembri's lawyers, who just so happen to also represent Pilatus Bank's owner.

The second stage is the intensification of a hate campaign that has recently culminated in the governing party's activists openly calling for me to be hanged for my work.

Malta's finance minister Edward Scicluna pinned a post to the top of his Facebook page which portrayed me as an all-powerful manipulator who should be blamed for Malta's recent credit downgrade following his disastrous handling of the scandal that engulfed Pilatus Bank and the authorities that were meant to supervise it.

He endorsed most of the disturbing comments that this post generated including one post that called for me to be sent to the gallows. He later claimed it was a mistake. But he did not apologise, nor did he delete the post.

'Yes, but look'

And when all that failed, the governing party has sought to discredit me through strategically placed stories in the press in an attempt to send a breathtakingly cynical message to the electorate: "Yes, we're corrupt but, look, so is everyone else."

A summary on the European Parliament's website was used to create the perception that I employed people I shouldn't have when the proper rule on the matter is crystal clear in the MEP statute.

Two of my relatives assist me with constituency work. They work part-time and are very modestly remunerated for that work.

They have not taken the post of an expert I required that could have gone to a more qualified applicant. Not only is there no breach of EU rules, there are no ethical implications either.

I take pride in being one of the few MEPs who audit their use of public funds. I do so annually and I publish the results of that audit. I have been doing so since 2010.

Malta's governing elite blames me for the fact that their laundromat, Pilatus Bank, is now having its license withdrawn.

For that, I will accept some responsibility. They are also concerned I might be going after their crooked accountancy firm next. They are not wrong.

David Casa is an MEP for the centre-right opposition Nationalist Party in Malta and a member of the European Parliament's special committee on financial crimes, tax evasion, and tax avoidance

Former Malta opposition leader fears for his life

Simon Busuttil spent 10 years as an MEP before returning to Malta to lead the opposition. He now fears for his life amid probes into high-level corruption in Malta's government.

Malta's PM cleared of Panama Papers wrongdoing

Malta's prime minister Joseph Muscat says a year long probe has dispelled allegations he, his wife and political associates were involved in money laundering or fraud.

Whistleblower fears for life as US arrests Malta bank chair

US authorities have arrested the chair of the Maltese-registered Pilatus Bank for tax evasion. The bank facilitated political corruption in Malta but its whistleblower is now facing jail in Malta and fears for her life.

Europe before the elections - heading back to the past?

Ahead of the European Parliament election in May, the bloc is ideologically split between authoritarians seeking to reduce its sway, and those seeking a moderate track. In essence, voters have to decide if they want to move forwards or backwards.

Russia and money laundering in Europe

After Danske Bank, both the US and the EU need to abandon the principle in bank regulation that it is all right to be a crook as long as you are big.

News in Brief

  1. European Parliament votes on reform of copyright
  2. New French-German parliament meets for first time
  3. EU parliament reduces polling ahead of elections
  4. UK parliament votes to take control of Brexit process
  5. EU publishes no-deal Brexit contingency plans
  6. EU urges Israel and Gaza to re-establish calm
  7. May admits 'not sufficient support' for third Brexit vote
  8. Orban vows more EU 'information campaigns'

Italy should capitalise on Brexit

Now that the UK is leaving, Italy can, and should, step up. It is the third largest country and economy in the EU. Spain and Poland follow, but they are significantly smaller economically and population-wise.

The Magnitsky Act - and its name

It is disappointing that so many MEPs in the Socialist and Green group caved in to Russian interests, in fear of challenging a plutocratic regime, by saying 'no' to naming the Magnitsky legislation by its rightful name: Magnitsky.

Stakeholders' Highlights

  1. Nordic Council of MinistersNew campaign: spot, capture and share Traces of North
  2. Nordic Council of MinistersLeading Nordic candidates go head-to-head in EU election debate
  3. Nordic Council of MinistersNew Secretary General: Nordic co-operation must benefit everybody
  4. Platform for Peace and JusticeMEP Kati Piri: “Our red line on Turkey has been crossed”
  5. UNICEF2018 deadliest year yet for children in Syria as war enters 9th year
  6. Nordic Council of MinistersNordic commitment to driving global gender equality
  7. International Partnership for Human RightsMeet your defender: Rasul Jafarov leading human rights defender from Azerbaijan
  8. UNICEFUNICEF Hosts MEPs in Jordan Ahead of Brussels Conference on the Future of Syria
  9. Nordic Council of MinistersNordic talks on parental leave at the UN
  10. International Partnership for Human RightsTrial of Chechen prisoner of conscience and human rights activist Oyub Titiev continues.
  11. Nordic Council of MinistersNordic food policy inspires India to be a sustainable superpower
  12. Nordic Council of MinistersMilestone for Nordic-Baltic e-ID

Latest News

  1. France takes Chinese billions despite EU concerns
  2. Europe before the elections - heading back to the past?
  3. Romania presidency shatters EU line on Jerusalem
  4. The Spitzen process - a coup that was never accepted
  5. Russia and money laundering in Europe
  6. Italy takes China's new Silk Road to the heart of Europe
  7. What EU leaders agreed on climate - and what they mean
  8. Copyright and (another) new Brexit vote This WEEK

Stakeholders' Highlights

  1. Counter BalanceEU bank urged to free itself from fossil fuels and take climate leadership
  2. Intercultural Dialogue PlatformRoundtable: Muslim Heresy and the Politics of Human Rights, Dr. Matthew J. Nelson
  3. Platform for Peace and JusticeTurkey suffering from the lack of the rule of law
  4. UNESDASoft Drinks Europe welcomes Tim Brett as its new president
  5. Nordic Council of MinistersNordic ministers take the lead in combatting climate change
  6. Counter BalanceEuropean Parliament takes incoherent steps on climate in future EU investments
  7. International Partnership For Human RightsKyrgyz authorities have to immediately release human rights defender Azimjon Askarov
  8. Nordic Council of MinistersSeminar on disability and user involvement
  9. Nordic Council of MinistersInternational appetite for Nordic food policies
  10. Nordic Council of MinistersNew Nordic Innovation House in Hong Kong
  11. Nordic Council of MinistersNordic Region has chance to become world leader when it comes to start-ups
  12. Nordic Council of MinistersTheresa May: “We will not be turning our backs on the Nordic region”

Stakeholders' Highlights

  1. International Partnership for Human RightsOpen letter to Emmanuel Macron ahead of Uzbek president's visit
  2. International Partnership for Human RightsRaising key human rights concerns during visit of Turkmenistan's foreign minister
  3. Nordic Council of MinistersState of the Nordic Region presented in Brussels
  4. Nordic Council of MinistersThe vital bioeconomy. New issue of “Sustainable Growth the Nordic Way” out now
  5. Nordic Council of MinistersThe Nordic gender effect goes international
  6. Nordic Council of MinistersPaula Lehtomaki from Finland elected as the Council's first female Secretary General
  7. Nordic Council of MinistersNordic design sets the stage at COP24, running a competition for sustainable chairs
  8. Counter BalanceIn Kenya, a motorway funded by the European Investment Bank runs over roadside dwellers
  9. ACCACompany Law Package: Making the Best of Digital and Cross Border Mobility,
  10. International Partnership for Human RightsCivil Society Worried About Shortcomings in EU-Kyrgyzstan Human Rights Dialogue
  11. UNESDAThe European Soft Drinks Industry Supports over 1.7 Million Jobs
  12. Mission of China to the EUJointly Building Belt and Road Initiative Leads to a Better Future for All

Join EUobserver

Support quality EU news

Join us