Former minister Austin Gatt is insisting that he never heard about an alleged donation of €2,000 made to his electoral campaign by John’s Garage.

Breaking a long silence since pulling out of politics in March, Dr Gatt yesterday told Times of Malta that the allegation made by oil trader George Farrugia at the Public Accounts Committee was news to him. “Yesterday [Monday] was the first time I heard about the alleged donation of €2,000 from John’s Garage and this is no surprise as I rarely had anything to do with fund raising for the campaign,” Dr Gatt said.

Testifying in front of the parliamentary committee, Mr Farrugia claimed that in 2008 he had attended an event forming part of Dr Gatt’s personal electoral campaign and donated €2,000.

I rarely had anything to do with fund raising for the campaign

Mr Farrugia was not sure whether Dr Gatt knew about the donation and could not remember whether he handed over the money to a canvasser or Dr Gatt’s son. But Dr Gatt yesterday insisted nobody in his family could recall the donation. “I have also checked with members of my family and they as well confirm that they never knew anything about it.”

Mr Farrugia also claimed that it was his brother Ray who had sent him to the event with the donation. The Farrugia brothers owned John’s Garage, a Ħamrun car rental company in Dr Gatt’s constituency.

When contacted yesterday Ray Farrugia said he did not remember the incident mentioned by his brother in front of the committee.

“I have asked for this to be checked, because I cannot recall the instance. I cannot comment before I know the facts. It’s been a long time and I cannot remember whether the donation was made,” he said.

Dr Gatt, who was responsible for Enemalta between 2004 and early 2010, which covered the period when company officials allegedly sought bribes to award oil contracts to select firms, is expected to testify at the PAC at some stage.

Mr Farrugia was given a presidential pardon at the start of the year to tell all on the oil scandal. Several top Enemalta officials have been charged in court with corruption and bribery.

While the corruption cases date back to the period before 2008, the parliamentary committee is probing the findings of the Auditor General’s report on how Enemalta bought oil between 2008 and 2011. But the story took on another twist on Monday when Mr Farrugia testified that Home Affairs Minister Manuel Mallia had known about the bribery since 2010.

‘Clear Mallia knew about corruption’

At the time Dr Mallia was representing Mr Farrugia’s brothers in a family dispute, with Mr Farrugia accused of siphoning company funds into a personal account. The dispute was settled when Mr Farrugia paid his brothers €1 million.

However, Mr Farrugia also testified that Dr Mallia had threatened to report him over the bribery if he failed to settle the dispute with his clients – Farrugia’s brothers.

This development prompted the PN to call on the Prime Minister and Dr Mallia to shoulder political responsibility.

“It is clear Minister Manuel Mallia knew about the corruption [at Enemalta] three years ago and did nothing to report it,” the PN said. The minister and Dr Muscat had to explain why they used the corruption information for electoral purposes rather than protect the national interest and report it.

In reply to the PN, Dr Mallia said the case between Mr Farrugia and his brothers involved misappropriation and he was appointed on this basis. He urged the “lawyer-filled” PN to understand the meaning of professional secrecy, adding it was a pity another lawyer was trying to take political advantage of this right.

The political responsibility for the bribery lay with the PN in government at the time, and not with himself.

A lawyer’s privileged communication

Turning from criminal lawyer to minister has its political pitfalls as Home Affairs Minister Manuel Mallia found out this week.

Testimony given by pardoned oil trader George Farrugia at Parliament’s Public Accounts Committee revealed that Dr Mallia had known about the oil corruption at Enemalta three years ago.

The revelation is politically embarrassing, especially after the Labour Party had made a meal out of allegations that members of the previous Nationalist government had known about the corruption but did nothing.

But Dr Mallia has a point going for him. Three years ago he was privy of the bribes in his capacity as a lawyer representing the Farrugia brothers in a family dispute with George Farrugia.

Should Dr Mallia have reported the case at the time?

While the Nationalist Party claims Dr Mallia’s non-action hurt the country even more because it allowed the corruption to go on unchecked, lawyer Joe Giglio argues otherwise.

Contrary to popular perception, he says, no individual has a duty or obligation at law to disclose or report to the police a crime that he may be aware of. “Let alone a lawyer working in the criminal field.” The only exception at law is a coup d’etat.

But Dr Giglio insists that whatever is said between clients and lawyers is privileged communication and highly confidential. It would also be “objectionable” if any professional leaked information on a privileged conversation to the press, he adds.

“Any breach of confidentiality can lead to a fine, imprisonment or even general interdiction. The reason for such stringent conditions is to make the client feel comfortable when sharing information with his lawyer.”

This was the argument put forward by Justice Parliamentary Secretary Owen Bonnici in defence of his Cabinet colleague at the PAC.

Dr Giglio says there is an obligation under money laundering law to report any suspicious financial transaction, but only if the person is enabling the transaction to take place.

“Any report on a suspicious transaction, such as doubts on the provenance of the money, will have to be lodged with the Financial Intelligence Unit and it will then be up to them to investigate the case,” he says.

PN deputy leader Beppe Fenech Adami implied the timing of the leak on the corruption to the media had political undertones.

The source of the leak remains unknown – and irrelevant to the corruption case at large – but whether the story broke as a result of political expediency is a matter for politicians to debate, not lawyers.

Dr Mallia was not in a position to take questions yesterday.

ksansone@timesofmalta.com