Legality of John Dalli inquiry is questioned

The legality of some investigation procedures adopted by the EU anti-fraud agency on the John Dalli resignation affair have been pointedly questioned by its watchdog.

A confidential report by the EU anti-fraud agency (OLAF) supervisory committee, leaked to the press during the past week, expresses serious concern about the way the agency obtained the mobile phone records of Maltese suspects in the Dalligate investigation.

OLAF justified its actions by referring to an EU law which gives it access to “any information held by the institutions, bodies, offices and agencies”. However, the watchdog pointed out, this does not cover requests to Maltese authorities to hand over the phone records of their citizens.

Mr Dalli was forced to resign as European Health Commissioner last October after the anti-fraud agency concluded there was “unambiguous circumstantial evidence” that he was aware of a request for a bribe to lift a ban on smokeless tobacco.

Speaking during a brief phone interview with The Sunday Times of Malta last week, OLAF director general Giovanni Kessler dismissed unconfirmed reports that the supervisory committee report – which at the time had not been published – had decreed some of his agency’s actions illegal.

The report does not use the word “illegal” but it questions and raises concerns about the legality of certain actions by the agency on this case.

The controversial document was presented to the Maltese press on Monday by Green MEPs Bart Staes and José Bové, who were in Malta on a fact-finding visit.

They demanded explanations from the European Commission President Jose Manuel Barroso, along with Mr Kessler’s resignation.

The new revelations may have no direct bearing on the case being heard in Malta, in which 48-year-old Silvio Zammit is pleading not guilty to charges of trading in influence and bribery for allegedly asking for €60 million from tobacco producer Swedish Match, to help alter legislation under the portfolio of the former Maltese Commissioner.

However, the report states that the human rights of some of the suspects – and in particular those of Mr Zammit – may have been breached.

This will place more pressure on Mr Kessler, who has faced calls for his resignation over the handling of the Dalli investigation.

The report also underscores certain haste about the investigation, pointing out, for instance, that it only took four months and three weeks, and also that at certain stages of the probes, officials seemed to justify insufficient analysis with reference to the “short time available”.

Besides the point on the phone records – which provided the bulk of the circumstantial evidence that OLAF held against Mr Dalli – the report also raises questions about whether the anti-fraud agency had the proper remit to carry out interviews and a spot check at Mr Zammit’s restaurant, Peppi’s in Sliema.

The agency carried out the check on the strength of a claim that it was also investigating allegations of misuse of EU funds. This would have made the investigation “external”, giving the agency extra powers to coordinate the probe with the anti-fraud coordination service.

But the committee point­ed out that hardly any questions were put to Mr Zammit about this allegation, suggesting that the EU funds investigation was simply a ruse.

The supervisory committee report also gives a clear indication of the institutional friction between OLAF and its watchdog when it highlights that Mr Kessler decided to send the Dalligate report to the Maltese prosecuting authorities before the committee had an opportunity to review it.

Mr Staes said that had Mr Barroso insisted on following the proper procedure, with the supervisory committee vetting and giving its opinion before the investigation was sent to Maltese prosecutors, Mr Dalli would have never been sacked.

Similarly, German conservative MEP Inge Graessle said the published report was an im­pressive record of “breaches of law, breaches of fundamental rights and sloppiness of the OLAF director-general during the investigation”.