Pardoned oil trader George Farrugia revealed yesterday that the company he owned with his brothers, John’s Group, had donated a Daewoo car to the Labour Party at around the same time they had given former finance minister Tonio Fenech a crafted clock.

Mr Farrugia said his brother Raymond, whom he had accompanied to Mr Fenech’s house to gift the clock crafted by his sister-in-law, had been in contact with former Labour official Manuel Cuschieri over the car donation.

Daewoo gift was same time as clock

He knew another two similar clocks, worth €400 each, had been donated to the Nationalist Party and had been included in the Independence Day lottery prizes.

Mr Farrugia was testifying before the Public Accounts Committee, which is probing the Auditor General’s report on Enemalta’s fuel procurement. He has been given a presidential pardon to tell all he knows about corruption and money that changed hands in fuel purchases.

Flanked by two lawyers, one of whom was former Nationalist MP Franco Debono, Mr Farrugia testified for more than three hours.

He said he had bribed former Petroleum Division head Alfred Mallia, former Enemalta chairman Tancred Tabone, Mr Tabone’s consultant Frank Sammut, as well as former Enemalta head of finance Tarcisio Mifsud.

He claimed he had paid Mr Mallia in the region of Lm40,000 over a period of four years until 2003 while he had paid Mr Sammut around US$100,000.

Mr Tabone allegedly received around US$400,000, some of which he shared with Mr Sammut.

Mr Farrugia said Mr Mifsud started receiving money from him when Mr Mallia was hospitalised and that was when he discovered Mr Mifsud was also involved.

He explained he owned John’s Group with his siblings until they decided to diversify in 1995, so opened a company called Power Plan Ltd, importing lubricants and servicing petrol stations.

He began contacts with oil giant Total in 1996 or 1997 and looked into using the Has Saptan oil storage facility for it to store fuel there.

In 1999 there was a port strike and Mr Mallia asked whether Enemalta could buy all the 20,000 tonnes of fuel Total had stored, but he wanted a commission.

‘I had to bribe people for tenders I’d already won’

Out of the 12 cents per tonne he used to receive from Total, he paid Mr Mallia five cents.

“He had told me either this way or you won’t work. I’m not saying I did the right thing,” Mr Farrugia told the committee.

Later that year, Total bid for a consignment of diesel and won the tender. Mr Mallia again asked him for a commission and he had paid him around $10,000 for this consignment.

He said he used to go to Mr Mallia’s house in Qormi to pay him in cash and said there was one instance when he had to pay him a commission even when the consignment had been cancelled.

“I had to pay bribes because I had already won, and not in order to win the tender,” he said, adding he felt threatened by Mr Mallia who used to tell him that it was either his way or nothing.

When Mr Mallia was in hospital, Mr Mifsud came into the picture.

It was about 2000 or 2001 when Mr Mifsud told Mr Farrugia that whatever sum he used to pay Mr Mallia, he had to pass on to him because they had already been splitting the proceeds.

“He used to call me and I would go to his office to pass on payments. I remember one particular time when he called me and I gave him Lm3,000 and on that occasion he told me I had no chance of winning the next tender.”

In about 2000, he started contacts with the Mediterranean Offshore Bunkering Services, owned by Enemalta, over the possibility of supplying it with Total’s fuel.

That was when Mr Sammut got involved. During one particular meeting, Mr Sammut had asked to continue the discussions outside his office and in his car asked for a percentage as commission.

Mr Farrugia had offered him half his earnings: “Power Plan used to invoice MOBC for consultancy and half of that I used to give back to Mr Sammut. My fee was $1 per tonne.

“I paid him at least $100,000 but at the time did not know that Mr Tabone was also involved.”

In about 2002, Mr Farrugia initiated contacts with another fuel giant, Trafigura, and introduced Mr Sammut to one of its representatives, Tim Waters.

I was frail and fell for his trap

“We were at a meeting in his office when Mr Sammut and Mr Waters walked out of the office for 20 minutes. Later that evening I met Mr Waters for dinner and he said he was disgusted that Mr Sammut had told him that if they won the tender to supply fuel, he would have to give him 50c per tonne,” Mr Farrugia said.

Mr Waters had still accepted to pay the commission, although he told Mr Sammut that it would be the first and last time.

Mr Sammut replied that he would have to tell Mr Tabone about it, saying that the then Enemalta chairman was already getting a cut of the payments.

“Nowadays I know I paid for nothing because the cheapest bid always won the tender.

“I don’t even know why I was paying this money. It is easy to be blacklisted,” he said.

“I used to pay Mr Sammut myself on behalf of Trafigura, from fees I used to receive.

“Then all of a sudden, Mr Tabone told me he did not want to share with Mr Sammut anymore and wanted the full amount.”

He said he first paid Mr Tabone in Switzerland, where the other man had asked to meet. On that occasion, he gave him $20,000.

“This went on for some time but one day I decided to stop paying. I was frail and I fell for his trap.

“I did not want to remain his puppet and continue being used because I was not a free person.

“Payments were illegal and were wrong. Today I am a persona non grata in Malta because of this,” Mr Farrugia said.

Asked about presents he had given to people, Mr Farrugia promised to furnish the committee with a detailed list of gifts and their recipients. His testimony will continue on Monday.

Earlier, Mr Tabone also appeared before the committee.

Through his lawyer, Henri Mizzi, he said he did not wish to testify to the committee as he was facing criminal charges in court which were still pending. His testimony was postponed to another date.