Updated | Judge confirms decision to release man wanted in US for €50 million fraud

The man is wanted by US authorities to answer charges of having defrauded the American government out of €50 million

A judge has dismissed an appeal filed by the Attorney General against a decision to invalidate the arrest of an Italian-American man wanted for fraud against the United States Government.

Frank Salvatore Rafaraci, a 68-year-old Italian-American man, is wanted by the American authorities to answer charges of having defrauded the United States Government out of some €50 million.

Rafaraci is wanted by the United States District Court for the District of Columbia for prosecution on the offences of conspiracy to commit bribery, bribery, conspiracy to commit wire fraud and conspiracy to commit money laundering.

The man had been suspected as a participant in a scheme that used falsified invoices and receipts for equipment and supplies provided to the US Navy.  

The man is also alleged to have paid a US government official tens of thousands of euro in cash bribes in exchange for insider information on future Navy contracts.  

US authorities believe the man and his known associates then laundered illicit funds using shell companies, evading millions of dollars in US taxes.

On Monday, magistrate Yana Micallef Stafrace declared the man’s arrest to have no basis in law and ordered his release.

Lawyer Meredith Ebejer for the Office of the AG argued that Monday’s decree quashed not only the arrest of Rafaraci but also the extradition proceedings as a whole.

Lawyer Stephen Tonna Lowell stated that the AG could not bring forward the request to revisit the decision to release Rafaraci from arrest. The Court of Committal didn’t discharge him from extradition proceedings, but these had yet to start – in fact a date had been set by the presiding magistrate for the extradition proceedings to start.

Therefore the court did not have jurisdiction over the matter at that point in time, and as a result the AG could not assume that the release was also with regards to the extradition, and not simply the arrest, argued the lawyers.

The AG’s request for re-arrest of a person set free was done in terms of Article 574A(9) of Chapter 9, which however only applies to individuals appearing before the Court of Magistrates and not a Court of Committal, said Rafaraci's lawyers.

The defence further submitted that a decree, which sought to state that Rafaraci was discharged from extradition, was null and void due to the fact that it was drawn up in the wrong language, that is in Maltese, whilst proceedings against the man were being held in English.

When judge Aaron Bugeja, presiding the Criminal Court, asked why the defence was claiming that Rafaraci wasn’t formally charged,  defence lawyer Stefano Filletti explained that the AG did not produce anything to prove that a complaint under US law equates a charge under Maltese law.

“In fact, the AG only produced photocopies of the documents sent over by the US department of justice,” he said, arguing that this was in itself less than that required in terms of law which specifically requires that documents produced must bear the seal of the Department of Justice. “Therefore, besides failing to provide some form of proof that a complaint in the US equates a charge in terms of Maltese law, the AG also failed to produce the documents in the required format with the warrant of arrest,” argued the lawyer.

With regards to the issue that the complaint, upon which the warrant for provisional arrest was based on, did not constitute a charge, as is required in terms of Article 14 of the Extradition act of Malta, it was argued by the defence that the AG had to take it upon themselves to provide some form of proof that a complaint under US law equates a charge under Maltese law. This had to be done by providing a legal opinion on the interpretation of the US legal documents.

With regards to the arrest warrant issued by the US Judge, on which the warrant of arrest in Malta is based on, the defence argued that this warrant held within it a number of boxes which needed to be ticked by the US Judge. In total there were 6 boxes: Indictment, superseding indictment, complaint, superseding complaint, complaint and a review of probation.

The defence argued that the manner in which they are placed on the warrant indicate that they always decrease in severity of nature. Therefore, the most severe would be the indictment, and the least severe would be the review of probation.

Since the box of ‘complaint’ was ticked by the US Judge, as opposed to that of indictment or superseding indictment, it clearly indicated that ‘complaint’ is of a significantly lesser nature than an indictment and from preliminary understanding therefore cannot be equated with a charge under Maltese law.

In a decision handed down this evening, Mr. Justice Bugeja did not uphold the appeal and confirmed the decision of the court of Magistrates.

Lawyers Stefano Filletti, Giannella de Marco, Stephen Tonna Lowell and Mark Refali represented Rafaraci. Lawyer Meredith Ebejer appeared for the Office of the Attorney General, together with police inspectors Omar Zammit and Robinson Mifsud.