Caruana Galizia's allegations against PM's wife refuted

Murdered journalist Daphne Caruana Galizia had accused Michelle Muscat, wife of Malta PM Joseph Muscat, of being involved in a kickback scheme. With the story refuted in inquiry, many no longer know what to believe

Daiva Repeckaite
Daiva Repeckaite NewsMavens, Malta
Caruana Galizia's allegations against PM's wife refuted - NewsMavens
A picture taken on April 27, 2017 shows journalist and blogger Daphne Capuana Galizia arriving at the Law Court in Malta. Capuana Galizia . AFP PHOTO / Matthew Mirabelli / Malta OUT

Why this story matters:

Since the murder of Daphne Caruana Galizia, there have been numerous protests for the government to intervene and dismiss officials accused of inaction not only in investigating the murder, but also holding responsible those who exploit offshore infrastructure for their benefit. The list included the Prime Minister's wife, who, according to Caruana Galizia, was behind a secretive company called Egrant Inc.

However, an inquiry revealed serious flaws in the investigation. Magistrate Aaron Bugeja flagged numerous inconsistencies in the testimonies of Daphne Caruana Galizia and key whistleblower Maria Efimova, both of whom had been abundantly praised by the press at the time of their investigation.

New evidence can still emerge, but the implications of the findings as they stand have far-reaching consequences -- for Malta's political parties, the media (after they already accused a foreigner of murder based on hearsay), and trust in whistleblowers. As James Debono writes, "Egrant is a cautionary tale on how the two-party system can distort legitimate civil society concerns towards partisan gain." Local media woke up to the shock that the narrative, which sounded too good not to be true, was apparently full of inconsistencies, and the shock has rippled towards critical media and the opposition, which had uncritically accepted the allegations (as detailed in an emotional account by a Lovin Malta journalist).

Context

  • Daphne Caruana Galizia, a journalist and blogger who focused on people in power, was named one of the 28 people shaping Europe’s future in 2017 by Politico and posthumously received many journalism awards.
  • Daphne Caruana Galizia published allegations that two top government officials, plus the prime minister's wife, own offshore companies created to receive kickbacks from Malta's controversial golden visa scheme.
  • The companies Egrant Inc, Tillgate Inc, and Hearnville Inc were bought by Brian Tonna of Nexia BT, the intermediary, in July of 2013.
  • In April this year, dozens of journalists joined the #DaphneProject to further investigate how high-ranking officials used offshore businesses. The project revealed some links in the chain of offshore architecture, namely, an intermediary company in Dubai, which had expected to receive money from a source in Azerbaijan and transfer funds to the two implicated officials' companies in Panama. But while new leaks have created some damning evidence against the two officials, notably Keith Schembri, the allegation against the PM's wife was never backed with proof.
  • An inquiry by Magistrate Aaron Bugeja found that the Panama companies, Egrant, Tillgate and Hearnville, never had accounts at the controversial Pilatus Bank, where key whistleblower Maria Efimova worked. The inquiry heard the testimony of 477 witnesses, requested information or assistance from authorities in five countries – Panama, Belgium, the UAE, Germany and the USA – and engaged various IT experts and firms.
  • The case against PM's wife Michelle Muscat was based on allegedly leaked declarations of trust. Caruana Galizia told the magistrate that she had a copy of the documents. Later she told she only had seen them printed. The whistleblower's version was "diametrically opposed to Caruana Galizia’s when she said that it was the journalist who showed her documents and not the other way around". Furthermore, the "documents turned out to be false, with forged signatures," and they were not found in the data sets of the intermediary Nexia BT, Efimova's former employer Pilatus Bank and the Panama Papers cache.
  • The only declarations of trust presented to the inquiry were copies brought to the magistrate by former Malta Independent director Pierre Portelli, who is today the Nationalist Party leader Adrian Delia’s head of communications, which experts found to have been falsified (here is the text posted on Caruana Galizia's blog).
  • Footage emerged of Ali Sadr Hasheminejad, the American-Iranian owner of Pilatus Bank, slipping out of the bank with two pieces of luggage. The narrative of him smuggling out evidence sounded very plausible, but CCTV footage and airline movement found no proof of it. A mysterious flight to Baku apparently did not happen either.
  • Two whistleblowers, whose testimony previously sounded consistent, now accuse each other. “I’m angrier than anyone that she hasn’t been extradited to Malta [by Greek courts] because I still have a pending case against her,” Jonathan Ferris, sacked financial investigations officer said.
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