Lawyer Aron Mifsud Bonnici charged with money laundering despite no outstanding tax, court told

Proceedings against lawyer Aron Mifsud Bonnici have kicked off in court as he faces money laundering, tax evasion and false declaration charges.

Mifsud Bonnici entered a not guilty plea after being read out the charges brought against him. The case against him was allegedly taken up by the police after he adjusted a tax return and corrected discrepancies.

Inspector explains the details of financial investigation

Taking the stand, Police Inspector Matthew Grech outlined the findings of a financial investigation that began after the police received confidential intelligence from a source.

The investigation, which spanned several months, included requests for information from various local and private entities, including Identità and JobsPlus. In December 2022, investigators also sought the assistance of authorities such as the Malta Tax and Customs Administration (MTCA) to build a preliminary financial profile of the accused.

The analysis revealed that Mifsud Bonnici was listed as director of various companies, some of which were inactive. Mifsud Bonnici was also a board secretary at state IT agency MITA and a company secretary at Enemalta. His financial footprint, particularly through accounts at HSBC and Bank of Valletta became the focal point of the inquiry.

Inspector Grech testified that HSBC records showed four accounts in Bonnici’s name, with minimal activity. At BOV, five accounts were analysed, including two client accounts and various savings accounts in both euros and US dollars. A particularly intriguing detail for investigators was a suspicious transfer between two of Mifsud Bonnici's own bank accounts.

The majority of transactions were routed through a BOV current account in euros.

Payments related to Bonnici’s professional legal work were mostly deposited here, including many cheque payments.

The investigation also uncovered the acquisition of three immovable properties, in Birkirkara, Gwardamangia and Attard.

The inspector emphasised the fact that when investigators compared the funds in Mifsud Bonnici’s bank accounts with the income he reported in his tax returns each year, they discovered irregularities. Financial records indicated significantly higher inflows than his declared income which highlighted discrepancies, the witness said.

At this point, the defence lawyers raised an important point, highlighting the fact that the alleged discrepancies were based on the total income of the lawyer and not the profit calculated at the end after deducting expenses. An individual could very well receive a very high income but when all the expenses of the month are removed, one is left with a much smaller amount to declare in a tax return.

Aron Mifsud Bonnici has no tax due

In court, it was confirmed Mifsud Bonnici had regularised his tax affairs, with payments made in full, including all penalties and interest. The tax for 2021, despite being due by July 2022 and was paid late, was still paid in full and accepted by the Commissioner for Tax. Thus, no pending dues remain and all adjustments made by the accused were accepted.

The inspector then claimed Bonnici filed the adjusted tax forms only after the investigation commenced, as a result of a tip-off.

Lawyers Giannella DeMarco, Stefano Filletti and Stephen Tonna Lowell were hysterical to this fact and argued that Mifsud Bonnici had simply realised of the errors present in his tax return and had simply adjusted it, just like everyone is allowed to do.

The lawyers reminded the court Mifsud Bonnici had done the adjustments well before he was ever spoken to or arrested. "The police deemed it suspicious that a simple correction to a mistaken tax return could be linked to possible tax evasion” the defence argued.

MTCA employee testifies

An accountant by profession employed with the MTCA made reference to compiled report he had prepared during the ongoing investigation, while testifying.

The report stated the findings and results of the investigation and the witness reiterated his opinions, that Aron Mifsud Bonnici was to be charged with tax evasion.

Defence lawyer Stefano Filletti reminded the court that an ex parte witness was not allowed to give his opinion or conclusions on any findings and that was reserved for a court appointed expert. The employee brought to the stand was not an expert appointed to carry out such duties.

Thus, Filletti asked the court to declare such a testimony inadmissable. If the report was going to be taken into consideration, Filletti requested that the defence be allowed to bring up to the stand their own accountant which would outline his own findings, which would be compared with the report.

Defence lawyer Giannella De Marco requested a ban on the publication of the figures of money held in the different bank accounts and the respective financial institutions mentioned and the court upheld it.

The sitting was adjourned to 23 July at 10.15 am.

The case is being presided over by Magistrate Leonard Caruana.