Prime Minister Joseph Muscat insisted yesterday he was not involved in a deal through which €1.65 million were paid for half ownership of a property in Valletta, saying he welcomed any scrutiny on the process.

He was reacting to a story in The Sunday Times of Malta which revealed that the government expropriated a property in Mint Street which Mark Gaffarena had purchased just a few weeks before knowing that the government intended to expropriate it.

Mr Gaffarena bought a share of the building on February 26 for almost €140,000.

Less than two months later, Mr Gaffarena’s stake was acquired by the Land Department for €822,500 in cash as well as parcels of land that exceeded 10 football pitches in size.

“I am informed that all negotiations and valuations were carried out solely by the Land Department,” Dr Muscat said when asked to comment on the story.“The government welcomes any scrutiny as in any other case,” he added.

He said that he had no objections to a review by the Auditor-General.

The Gaffarena family has been at the centre of controversy over an illegally-built petrol station in Qormi. The facility was kept closed and unused for months after enforcement notices. Soon after Labour was elected it benefited from anew Mepa policy and was allowed to start operating. It was the only petrol station to benefit from the new policy.

Speaking later at a press conference, Parliamentary Secretary Michael Falzon insisted that there was no political interference in the case.

Dr Falzon said normal legal procedures had been followed and the amount paid to the part-owner, Mark Gaffarena, was the fair amount based on the estimate of various architects.

The process, he said, did not look into how much a person would have bought the property for, but its actual value.

Asked whether he would launch an investigation into possible inside information to Mr Gafferena, he said it was not  a crime to make profit.

The government’s duty, he said, was to ensure that the amount paid in compensation was fair. The process, he said, was transparent, and if the other property owner wanted to sell the property, the same amount would be paid.

The expropriation had been needed because the government faced eviction by 2028, he said. The property is used as a school and for the offices of the Building Industry Consultative Council.