Man gives blow-by-blow account of alleged fraud

A magistrate yesterday heard how a man invested Lm61,000, through a lawyer charged with misappropriation and fraud, but after two years he had only got back Lm14,605.

Mario Abela was testifying in the compilation of evidence against lawyer Patrick Spiteri, 39, of Wardija, who is pleading not guilty to defrauding him and Josie Theuma out of a total of Lm120,000 and misappropriating the money.

Abela testified at length before Magistrate Saviour Demicoli and explained that some time in 2000 he sold a property he owned to invest in the stock market.

Two weeks later, Theuma, who he had known for over 20 years, told him that Spiteri had approached him (Theuma) and told him about a "one-off" investment.

Abela and Theuma went to Spiteri's Ta' Xbiex office to discuss investing in Lehman Brothers.

Abela told Spiteri he wanted to invest in Maltacom GDRs (Global Depositary Receipts) and Spiteri told him it would be better to first invest in Lehman Brothers as the investment would yield an 18 per cent interest over three months. After that, Spiteri suggested investing in the Maltacom GDRs.

Abela explained that he was going to invest Lm61,000 while Theuma would invest Lm41,000 in Lehman Brothers.

The day after their meeting with Spiteri, Abela said, he went to the bank and made a bank draft for Lm61,000. He gave the bank draft to Theuma who passed it on to Spiteri, as agreed. Two days later he was handed a receipt of the transaction and did not give much importance to the fact that it was on Theuma's name.

Three months later, Abela said, Theuma told him that Spiteri had informed him that their investment had yielded over 18 per cent.

The two men went to Spiteri's office and he told them the Lm102,000 they had invested had now risen to $193,000 - a 26 per cent interest rate.

At the meeting Spiteri asked Abela and Theuma what they wanted to do with the money and they said they wanted to take $17,000 and invest the rest into the Maltacom GDRs. Out of the $17,000 Abela was to take $5,000 and Theuma $12,000.

In October 2000, Theuma told Abela that Spiteri had confirmed the purchase of the GDRs and eventually Spiteri passed a document on to Theuma.

Abela asked Theuma to ask Spiteri for the GDR certificates and their $17,000 but time rolled on and they did not receive anything. Meanwhile, Abela said, he started to worry and insisted on having the certificates.

Then, in May 2001, Theuma informed him that Spiteri could give them the money. So that same month the two men went to Spiteri's office where he told them that the $17,000 had become $18,650 thanks to interest as they had been in an interest bearer account. Spiteri, Abela said, insisted they take the interest too.

Abela explained that the money was passed on to them gradually but by August 2001 he had been given his $5,000, in Maltese currency, including interest.

Abela went on to explain that by September of 2001 he still had no certificates of the Maltacom GDRs, despite his insistence.

That same month Abela and Theuma had the opportunity to invest in property through another person. Abela explained that he requested a meeting with Spiteri regarding the certificates which he needed in order to borrow money from the bank for the property investment.

On September 11, 2001, Abela and Theuma met with Spiteri and Abela asked him if there was a problem since he intended to sign a promise of sale agreement within three months. Spiteri told him to go ahead and that the certificates would be in his possession within two months.

Abela said that due to the effect of the 9/11 attack on America he put his investment on hold but did not inform Spiteri so that he would give him the certificates.

Some time later, Abela said, Theuma told him that Spiteri had handed him a statement showing the purchase of shares but still no certificates. Then, towards the end of 2001, Spiteri informed them about another opportunity to invest by selling the Maltacom shares to Italians, gaining interest, then buying the equivalent number of shares from the Maltese market.

Eventually, Theuma informed Abela that the Maltacom shares had been sold for Lm21,000 and the new shares bought.

Abela further explained that he received a total of Lm14,605 between June 2001 and 2003.

Once he learnt that Spiteri was in prison, Abela added, he started to worry and waited until Spiteri was released before meeting up with him regarding his money.

During a meeting Spiteri told Abela that his money was safe but he could not pass it on to him at that moment.

Some time later Theuma informed him that during an argument Spiteri had told him (Theuma) he would never see his money. That was when Abela decided to go to the police and on November 13, 2003, he filed a police report.

At the end of yesterday's sitting Magistrate Demicoli ruled there were enough reasons for Spiteri's indictment.

The case continues.

Police Inspector Helga Debono prosecuted.

Dr Giannella Caruana Curran and Dr Emmanuel Mallia appeared for Spiteri.

Dr Joseph Giglio represented Abela and Theuma.