22 accused of participating in insurance fraud racket

22 individuals are facing criminal proceedings on charges related to insurance fraud.

Of the 22 persons accused before Magistrate Aaron Bugeja, 4 pleaded not guilty, 2 admitted, one was not traced, one failed to show up and 12 cases have been put off to a later date in order to allow possible out-of-court settlements to be finalised. 8 insurance companies: Atlas, Untours, Elmo, Gasan Mamo, Allcare, Citadel, Fogg (now Argus) and Middlesea Insurance are claiming to have been defrauded by the racket.

38 year-old Joseph Sultana from Qormi was the first to plead guilty to defrauding €1,100 from Untours Ltd. Magistrate Bugeja ordered a pre-sentencing report for the man.

The other accused who pleaded guilty – a 35-year-old man from Tarxien - had repaid the amount due to Atlas Insurance in full. A representative of the insurer confirmed that the man, who is not being named as investigations are ongoing, had repaid €3,000 in cash, and that no further payments were due from him. A claims manager from Gasan Mamo Insurance Ltd confirmed to the court that the company had received a claim in 2013 about a collision between a Mistsubishi and a Nissan. The insurer had assessed the two vehicles to be beyond economical repair. No payment had been made and the claim was not withdrawn. Investigations into the matter are still underway.

The court told the accused that he was being charged with attempted insurance fraud and making false declarations with the aim of unjustly enriching himself. He pleaded guilty as charged.

Inspector Rennie Stivala informed the court that the accused had cooperated fully and had a clean police conduct, but he was concerned by the fact that he was involved in three cases. He had not benefited financially in all of them, but the act had been repeated.

Lawyers Jason Grima and Stefan Zrinzo Azzopardi for the Malta Insurers Association asked the court to take into account the planning involved in the crime. 

The man's defence lawyer, Joe Giglio, pointed out that he had insisted that while true there were multiple counts, in every instance he had repaid the amounts and where possible, he had stopped the claims.

“We have 26 individual cases. The people you have before you today likely do not know each other. I am confident that the court will treat the cases individually." GasanMamo had not paid out the claim as yet, he said.

Giglio referred to the punishment meted out to Lawrence Fenech, a former CEO at Malta Air Traffic Services who had admitted to fraud, misappropriation and abuse of public office. Fenech had been handed a suspended sentence and orderd to repay the amount defrauded. He had also been placed under a perpetual interdiction. The magistrate said that he was also of the opinion that this would be a good benchmark for sentencing purposes.

The court took into consideration the man's hitherto clean criminal record and ordered the director of probation to prepare a pre sentencing report about the accused.

The lawyer added that in future, the accused may be called to testify against a third party and would not benefit from the reduction in punishment afforded for cooperation. The prosecution had said that he would be testifying, said Giglio.

Both prosecution and defence agreed that the name of the man should not be published as "it could pose a danger to third parties."

Lawyers Lucio and Michael Sciriha, appearing for 5 of the accused, requested a postponement of the case to allow them to regularise their clients' positions. Dr. Michael Sciriha argued that it was stipulated in the Criminal Code that when dealing with insurance fraud, if payment is effected before judgment, this attracts a mitigation of the punishment to be inflicted. Additionally, the defence lawyers requested that the prosecution quantify the exact amounts allegedly lost by the insurers. This would allow them to carry out negotiations with the insurance companies with a view to reaching a potential out-of-court settlement, he said. The court gave the lawyers till the next sitting to present the conclusions of the negotiations.

Lawyers Abigail Critien, Arthur Azzopardi and Carina Testa are also appearing for individual defendants.