Car dealers charged with odometer fraud, money laundering

The owners of Alexander Auto Dealer and Rokku Auto Dealer have denied tampering with the mileage of over 400 vehicles they had imported from Japan.

Alexander Spiteri, 48, from Mellieha, Roderick Vella, 46, and Alison Vella, 47, both of whom live in Zabbar, were arraigned by summons before Magistrate Rachel Montebello on Thursday. All three defendants pleaded not guilty to charges of fraud and money laundering.

Sources connected to the case estimate that the total amount defrauded from customers could run "into a few million euros."

In June 2022, a MaltaToday investigation had revealed that high mileage cars, bought from Japanese bidding markets on the cheap, would then be sold in Malta with the mileage displayed on the dashboard gauge having been drastically reduced.

An exercise carried out by MaltaToday compared the original mileage recorded by JEVIC in a publicly available online database with the mileage as recorded by Transport Malta.

Using a sample of 18 vehicles which had been flagged by several sources, large discrepancies between the original mileage and the one registered in Malta were found, ranging from 30,000km to 130,000km.

The court upheld the prosecution’s request for a freezing order over all of the defendants’ assets.

The magistrate also observed that the AG had filed a note, informing the court the office had not yet received the inquiry file.

Pierre Montebello, Chief Officer at the Land Transport directorate TM was the first witness.

He explained how an internal whistleblower had asked to speak to the Driving and Vehicle Licensing Unit (DVLU) and informed them that there were cases where vehicles were being found to have JEVIC certificates that been tampered with.

“This was in early May 2022,” he said. The witness had spoken to the Chairman and CEO, at the time Joseph Bugeja, and presented him with the findings of internal investigations, which took a week or 10 days to complete.

Montebello gave a quick overview of the licensing process. “When vehicles arrive from abroad in port, the ships have documentation, amongst them the JEVIC certificate, which amongst other information certifies the vehicle’s mileage… At the time a number of police officers would inspect the vehicles to check that the data matched.” 

The main document used in car imports is known as the VH005, the first part of which is filled in by the importer or dealer, the second part by the police and the third part by Transport Malta, after verifying and checking the documentation.

Part of that documentation is the JEVIC certificate, which details the date of the inspection, the Vehicle Identification Number and the odometer reading. “At that time we would only check that the VH005 details matched the JEVIC certificate,” explained the witness.

“There is an online equivalent of the JEVIC certificate,” Montebello went on. “We went through the list, vehicle by vehicle. We did this for all dealers, not just Rokku,”  he added.

When they were comparing the declared values on the documentation presented with those on the online JEVIC, a number of discrepancies had emerged, he said.

“The VIN number would match, but the odometer reading would not. We found the odometer reading specified as 93,000km, for example and the online JEVIC would be over 200,000km.”

At the time, the police were solely responsible for doing these checks, said the witness, explaining that as a result of the case, these inspections are now being carried out by Transport Malta personnel rather than police officers.

“At the beginning of the internal investigation, we found 301 vehicles with discrepancies,” Montebello said. Another 100-120 vehicles emerged as a result of the police investigation.

“At no point did it appear to us that the JEVIC certificate presented to us was false… It matched the VH005,” he stressed.

The witness said that a number of car importers were looked into. “There were two where discrepancies were repeatedly coming up: Rokku Auto Dealer and Alexander Auto Sales.”

He gave the court a sample of two files, one for a Toyota Ace and the other for a Daihatsu Hijet for illustration purposes.

“After this case emerged, the procedure was changed to include a comparison of the odometer reading with the online JEVIC record,” the witness said.

When asked by lawyer Franco Debono in cross-examination, as to whether other car importers had been flagged by their investigation, the witness replied that there weren’t. “No, only those two,” the witness replied.

He asked the witness what the police would fill in on the forms. “Odometer reading and mileage,” Montebello replied. He was unable to confirm whether this was done in the presence of anyone in particular, or how the police would work.

“Did you check with whoever filled in the form, how they had arrived at that number?” asked the lawyer. Montebello said that he had not.
He clarified that the police officer who would fill in the mileage box on the form would have seen the figure in person, after turning on the car’s system. The online JEVIC figure was received from abroad.

Prosecutor Marthese Grech asked how long it normally took for a vehicle’s importation papers to arrive at Transport Malta. “The process takes a week or two,” he replied “because after that they would start being charged for keeping the cars there.”

The case was adjourned to November for further prosecution witnesses.

Prosecutors Marthese Grech and Etienne Savona, from the Office of the Attorney General, assisted Police Superintendent James Grech.

Lawyers Jason Azzopardi and Franco Debono are defence counsel.