Prime Minister Joseph Muscat has addressed the kickbacks allegations involving his chief of staff, Keith Schembri, in a fact-checking section titled ‘smear campaign’ on his new campaign website.
The Times of Malta has assessed the facts as presented by Dr Muscat against information that is in the public domain.
Claim:
If Keith Schembri was going to have funds obtained from illegal activity transferred to him… would he have had them transferred in his own name?
Fact:
When the payments were made, Brian Tonna would obviously not have labelled them ‘kickbacks from passport sales’.
The whole point of money laundering, which the government’s anti-money-laundering agency (FIAU) suspects is what took place, is to make illegally gained proceeds appear legitimate.
One way to do this is through the use of so-called bogus loans, which is what the FIAU suspects took place.
According to the report it drew up and handed to the police, the bank queried the transactions, at which point a loan agreement was presented in order to justify them.
The transactions were not reported to the authorities by the bank.
The FIAU only investigated after the Panama Papers came out in 2016, at which point Mr Schembri’s financial structures came under scrutiny.
Claim:
[Those engaged in the ‘smear campaign’] failed to explain that there was a reasonable explanation about the money transfer.
Fact:
The FIAU did not find this explanation reasonable.
In a statement, Mr Schembri said that a €100,000 payment from Brian Tonna’s account to his was for a loan given in 2012.
The FIAU found that there was little or no activity in these two Pilatus Bank accounts prior the €100,000 transaction.
The unit found no trace of the original 2012 transaction as evidence that a loan had been made by Mr Schembri to Mr Tonna. “In view of the circumstances surrounding this loan agreement, it cannot be excluded that the agreement might have been drawn up more recently and backdated in order to justify the transfers to Mr Schembri,” the FIAU said in its report.
Claim:
The IIP [passport sales] scheme was launched in February 2014. The loan agreement between Brian Tonna and Keith Schembri dates back to 2012.
Fact:
If the FIAU is correct in its suspicions that the loan may have been bogus, then the launch date of the IIP scheme is irrelevant.
As already explained above, the FIAU said that the loan agreement could have been backdated.
Claim:
Again no proof. No solid evidence.
Fact:
The FIAU found there was sufficient evidence to draw up a report and give it to the police in order for them to investigate Mr Schembri and Mr Tonna. The agency told the police that there was “reasonable suspicion” that the two men were involved in money laundering or the proceeds of crime related to kickbacks from the sale of Maltese passports.
From that point on, there was no more the FIAU could do, as it is up to the police to compile evidence in order to initiate criminal proceedings.