Prosecutors detail Yorgen Fenech money laundering case

Yorgen Fenech’s lawyers have denounced what they described as a ‘frenzy to persecute’ their client as a court heard money laundering charges against him appeared half-baked.

The magistrate hearing the money laundering case recently filed against Yorgen Fenech is to decree on whether or not there are sufficient grounds, at first glance, for him to stand trial.

Fenech is accused of laundering and misappropriating funds from a company which he owns with his uncle Ray Fenech.

Presiding magistrate Donatella Frendo Dimech turned down a recusal request filed by Yorgen Fenech’s lawyers as the case was called this morning.

Lawyers Cinzia Azzopardi Alamango and Marthese Grech from the Office of the Attorney General summoned the investigating police officer, Inspector Brian Camilleri to the stand, who read at length from WhatsApp chats between Fenech and others, which he said gave rise to suspicion of criminal plans.

This hours-long endeavour exasperated the magistrate who pointed out that a summary could have been read out in court as the chats themselves were to be presented as evidence.

Magistrate Frendo Dimech was also incredulous at the fact that there was no request to close the inquiry yet and said that this was unlikely to be completed by the next sitting.

From online gaming activity, €5,000 went to Nicholas Cachia's account. Meanwhile €40,000 went into another account belonging to a third party, said the inspector.

However cross-examined by defence lawyer Charles Mercieca, the inspector could not say what had led to the investigation. “Was it a report or a criminal complaint by an injured party?” asked the lawyer. There was none, replied the inspector.

Neither could he immediately say what the predicate offence – the offence which necessitates the laundering of money – was. After much to-ing and fro-ing the inspector said it was “fraud and misappropriation.”

Nor was Ray Fenech, who holds 50% of the company allegedly defrauded, spoken to by the police. The fraud was flagged internally by the company’s auditor, explained Camilleri.

Later, after the court tried once again to identify the predicate offence, the inspector said that he could not tie the charges to any offence “at this stage.”

Lawyer Cincia Azzopardi Alamango, from the Attorney General's office, argued that the messages indicate that there were attempts to conceal things. It emerges that Fenech was aware of the messages and was giving instructions on how to work this system, she said. The lawyer noted that there was a particular chat where Yorgen Fenech asked "how much did we launder?", and goes on to say "so that no questions are asked". The prosecution says they are basing themselves on the chats and emails.

Lawyer Charles Mercieca, appearing for Fenech together with lawyers Gianluca Caruana Curran and Marion Camilleri, denounced what he described as a “frenzy to persecute Yorgen Fenech and those around him”. He decried the fact that people were being held in custody on the basis of messages which hadn’t been presented in court.

Mercieca said that it resulted from the investigating officer's testimony that the amounts allegedly laundered are €5,000 and €40,000 and that these amounts were not tied to any criminal activity that can be attributed to the accused.

"This act, of arresting a person and charging them in court should be done seriously and with great diligence and attention to the fundamental rights and dignity of the person," he argued, adding that Fenech would be taking “the necessary measures to protect his rights at law” – effectively declaring that another Constitutional case will be filed by Fenech.

11:57 That's the end of today's sitting. The case continues on 7 September at 12:30pm. We will provide a full write-up shortly. Nicole Meilak

11:57 "In view of that emerging from the testimony of the inspector, the accused reserves his rights to take all the measures necessary and opportune to protect his rights at law." Nicole Meilak

11:56 He says that it results from the investigating officer's testimony that the amounts allegedly laundered are €5,000 and €40,000. These amounts are not tied to any criminal activity that can be attributed to them.

"This act, of arresting a person and charging them in court should be done seriously and with great diligence and attention to the fundamental rights and dignity of the person." Nicole Meilak

11:48 Mercieca asks the court to intervene in the interests of justice. These things must not repeat themselves, he says. The magistrate confirms that she will deliver her decree tomorrow or on Friday. Mercieca wants to register a note before the sitting ends. Nicole Meilak

11:44 Mercieca further notes that the €5,000 is alleged to have been defrauded from a company belonging to Fenech himself. "Where is the fraud? How can I be accused of misappropriating from and defrauding myself?"

The court however points out that there is a separate juridical personality when it comes to companies. Nicole Meilak

11:40 "Bring us all the evidence, let the court decide on the basis of it." Nicole Meilak

11:39 "There is no evidence presented. I dare say not even reasons," the lawyer says. He argues that the €40,000 is legitimate, and that the evidence so far is all hearsay. "He said his investigation was based on the chats, which were not even presented in court." Nicole Meilak

11:37 Mercieca says there is a "frenzy to persecute Yorgen Fenech and those around him". He is accused of laundering €5,000 together with other people who are being held on remand on the basis of messages which haven't been presented. Nicole Meilak

11:33 Cincia Azzopardi Alamango, a lawyer from the Attorney General's office, argues that the messages indicate that there were attempts to conceal things. It emerges that Fenech was aware of the messages and was giving instructions on how to work this system, she says. The lawyer notes that there is a particular chat where Yorgen Fenech asks "how much did we launder?", and goes on to say "so that no questions are asked". The prosecution says they are basing themselves on the chats and emails. Nicole Meilak

11:31 The court has heard enough. It moves on to hearing arguments. The witness steps off the stand. Nicole Meilak

11:31 Mercieca asks how much money Fenech is being accused of laundering. "Is it €45,000?

The court tells the witness that he is saying that there is no criminal activity. He replies that it's only at this stage. The magistrate reminds him that he decided to charge the accused "at this stage". Nicole Meilak

11:22 Mercieca asks whether the inspector suspects that the €26,000 is laundered money. The inspector says it isn't, and explains further. He says that Nicholas Cachia deposited €200 in his gambling account, and received €26,000 in return. These were bonuses on his account with Glimmer Limited. This €26,000 was in Cachia's portomasolive.com account and stayed there until they were withdrawn by the company when the issue arose. Nicole Meilak

11:17 "This is not an experiment, you're playing with people's lives, these are criminal proceedings," Mercieca states. Nicole Meilak

11:15 A re-examination by the lawyers from the Attorney General's office prompts the inspector to mention a new figure of €26,000 in bonuses. The court asks where this figure comes from. According to the inspector, it is the amount of bonuses made to Nicholas Cachia's game account. The amount remained in the man's online gaming account with portomasolive.com. Nicole Meilak

11:11 "At this stage, I cannot tie it to any offence," the witness says. Nicole Meilak

11:10 There seem to be no further questions from the defence. However, the court asks the witness about the €40,000 transaction. "How did they get dirty?" the magistrate asks. Mercieca protests, arguing that the witness is being given too many chances. Nicole Meilak

11:08 One of the transactions is labelled "payment for horse". The prosecution knows that the accused traded horses, Mercieca points out. Nicole Meilak

11:04 The inspector says the company had an explanation, as mentioned in the chats, which it gave to police. The explanation was not confirmed by the investigation, he says. This prompts the lawyers to exclaim that they had not investigated the victim. Nicole Meilak

11:02 "How can you tell me the money is dirty if you don't know where its from and haven't spoken to everyone?" asks the magistrate. Mercieca also points out that the accused has an 18-year sentence over his head. On the €40,000 transaction, the inspector says that "at this stage no criminal offence has been identified in connection with this amount".

"You must be careful," says the magistrate. Nicole Meilak

10:53 After several minutes of questioning, the inspector says that there was no report from the company to the police. Mercieca asks whether Ray Fenech was spoken to, since he owns 50% of the company's shareholding. The witness confirms that he was not spoken to. Nicole Meilak

10:52 He asks if they've been spoken to, and the inspector says that this will result from the inquiry.

"Did the company tell you that it was defrauded?"

"Directly, no," the inspector says. It was flagged internally by the company's auditor. Nicole Meilak

10:49 Mercieca is asking who the victim of the fraud is. "It appears to be Glimmer Limited," the inspector says.
Nicole Meilak

10:46 The witness says the money was a means to an end of fraud.

"So the predicate offence is fraud?"

"That's what it seems to be"

Fraud and misappropriation, the inspector says. Nicole Meilak

10:45 "So what is the predicate offence, leading to these moneys materialising?" asks the lawyer. The witness doesn't understand. The magistrate clarifies that a predicate offence is the criminal act that necessitates that the money be laundered in the first place.

"I investigated on the basis of messages that were there...," says the inspector. The magistrate stops him and asks him what the criminal activity was. Nicole Meilak

10:42 The last interrogation was a few hours before the arraignment. It was already in the news that he would be arraigned, Mercieca suggests.

"It could be," replies the inspector.

Asked whether the investigation had started on a report or a criminal complaint by an injured party, the witness says they had not. Nicole Meilak

10:38 Mercieca is asking about the €40,000 transaction. The inspector replies: "I verified that the transaction details and accounts matched the communications which I had in hand."

"So on this transaction, all you did was compare it with the chats and then asked the accused about them?" Mercieca asks.

"Yes," the inspector responds. Nicole Meilak

10:37 From online gaming activity, €5,000 went to Nicholas Cachia's account. Meanwhile €40,000 went into another account belonging to a third party. Nicole Meilak

10:36 We resume: Charles Mercieca asks the inspector if he had investigated the case alone. He says there was no other inspector. Mercieca then asks how much money had allegedly been laundered. Nicole Meilak

10:19 The magistrate is annoyed at the prosecution's decision to read through the messages instead of giving a summary, as this took up a lot of time for nothing. She also lambasts the prosecution for not presenting the acts of the inquiry beforehand.

"There is no request to close the inquiry by the police yet, so you are expecting that the magistrate will close it by Friday?!" the magistrate says. "You knew it was for prima facie today. I am going to be rigid. There are so many cases, I cannot afford the time."

The magistrate retires to the chambers to give the defence time to coordinate its contestation of the prima facie request, but states that the matter will be decided today. Nicole Meilak

10:11 The court and the lawyers are thrashing out whether or not to contest prima facie today. The defence says it has witnesses of its own to summon, but the magistrate protests. "The court is inundated. I cannot give different dates." Nicole Meilak

10:07 Fenech was questioned four times, always in the presence of his lawyer, the inspector says. He now exhibits the documents he made reference to during his deposition to the court. Charles Mercieca is to cross-examine. Nicole Meilak

10:02 The inspector has since finished reading through the chats, and is going to begin presenting the court with recordings of the interrogation and evidence given to the accused prior to the interrogation as disclosure. Nicole Meilak

09:56 Asked by the prosecution on what led to suspicion and who he had spoken to afterwards, the inspector says that it was the messages and the volume of them that raised concerns.

"We are talking about €5,000," reminds Mercieca.

The witness now asks for the next part of his testimony not to be reported as investigations are still underway. However, the magistrate points out that proceedings should be made public as much as possible.

"It's just this part," the inspector says. Nicole Meilak

09:51 Moving to 26 September 2019, and Patrick Demanuele (Tumas Group's Chief Operating Officer) writes to Fenech saying that he was questioned about a large bonus, saying that he'll speak to Ray Sladden about the issue. Sladden is a director at Tumas Group. Nicole Meilak

09:45 The inspector continues to read through the chats from September 2019.

"I sent you €5,000," Yorgen Fenech wrote to Nicholas Cachia. This in fact matched a transaction from Cachia's account to Glimmer's.

Fenech's defence lawyers Charles Mercieca and Gianluca Caruana Curran discuss something, shaking their heads. Nicole Meilak

09:43 €200 from Nicholas Cachia's account went to Glimmer's account - reminder that Cachia is also being charged with financial crime in similar proceedings. They were credited to an account belonging to PortomasoLive.com - a service linked to Glimmer Limited.

"It is an online gaming account," the inspector says. Nicole Meilak

09:41 The witness says that the police had seen the transactions and had liaised with BOV over the payments. It appears that Cachia had paid money into a client account of Glimmer Limited. It then emerged that Glimmer's ownership is split 50-50 between Yorgen Fenech and his uncle Ray Fenech. Nicole Meilak

09:40 Meanwhile, Yorgen Fenech and his lawyer Charles Mercieca appear in deep conversation. One lawyer from the Attorney General's office asks about Glimmer Limited and its relevance in the chats. Nicole Meilak

09:39 The witness has been zipping through the chats, some of which are conversations between Fenech and Patrick Demanuele - the latter is one of the five accused of financial crime. It is hard to follow the exact conversation, although one exchange refers to cash in France. Nicole Meilak

09:35 The first person to take to the witness stand was Inspector Brian Camilleri, who spoke on Whatsapp chats from November 2019 between Yorgen Fenech and an unknown third party. These chats raised suspicion on criminal plans involving Fenech and this person. A copy of the chats were presented to the court. Nicole Meilak

09:33 A quick recap of what has happened since the start of today's sitting. Presiding magistrate Donatella Frendo Dimech turned down a recusal request from Yorgen Fenech, while the Attorney General initially requested that the testimony be heard behind closed doors, so as not to divulge any details of ongoing investigations. However, the magistrate instead stated that the testimony is to be heard in public, with certain details omitted. Nicole Meilak

09:30 Good morning. We are back in court today following the start of the compilation of evidence against Yorgen Fenech, this time over money laundering charges. Nicole Meilak