Parliamentary committee set to grill former prime minister this evening

The parliamentary committee investigating the Auditor General’s fuel procurement audit will be grilling former prime minister Lawrence Gonzi this evening. 

Although the Auditor General’s report covers the period between 2008 and 2011, the Public Accounts Committee is expected to raise questions in connection with the oil scandal revealed by MaltaToday in 2013. The newspaper’s investigation was to lead to the revelation that pardoned oil trader George Farrugia started paying illegal commissions in 1999. He claims that the kickbacks stopped in 2005.

Farrugia learned that he could be pardoned for the bribery of Enemalta officials on fuel contracts a day after Gonzi – then prime minister – first pronounced himself on a presidential pardon being granted for whoever could give police information on the Enemalta oil scandal.

In fact, the police investigating team would later tell the PAC that they were interrogating Farrugia when news of the presidential pardon emerged. 

“I learned about the presidential pardon through the internet and no one before then had ever told me anything about it. Farrugia was then released on police bail. The following morning I received a text from his lawyer [Franco Debono] asking whether we had told Farrugia about the pardon,” Inspector Angelo Gafa told the PAC.

“We had only informed him of what was in the media. Debono said Farrugia was ready to consider it and I informed him that it was not in my parameters to discuss the pardon.”

Farrugia may have availed himself of the right to remain silent during a 48-hour arrest in order to be eligible for a presidential pardon.

During the media’s following of the scandal, several questions were raised, including purported contradictory statements by Gonzi.

For example, it was only in October 2013 that Gonzi denied that a member of his security detail gave him in 2011 documents with allegations of irregularities in the procurement of oil supplies for Enemalta. He was then reacting to a sworn testimony by MaltaToday managing editor Saviour Balzan.

MaltaToday had already asked Gonzi the same question during the 2013 election, on 26 February, specifically about a member of the Malta Security Services who had informed him in the summer of 2011 of the invoices and documents pertaining to Farrugia’s activities, himself accused by his family of siphoning off some €6 million in commissions on oil imports from family business Powerplan.

MaltaToday had specifically asked Gonzi about the MSS member who informed him of Farrugia’s activities, and of accusations that he had siphoned off his family business’s profits to a hidden company, Aikon Ltd, with related invoices. Gonzi reportedly told the officer to report the allegation to the Commissioner of Police, without taking any further ownership of the matter.

This contradiction is further strengthened by an interview Gonzi gave to MaltaToday just a week before the 2013 general elections.

He stressed that he was never directly approached by anyone who had any information on Frank Sammut, the former Enemalta consultant implicated in kickbacks stemming from oil purchasing agreements related to Enemalta.

“I am now aware that persons received information who took it straight to the competent authorities, as expected, but I never had any direct or indirect information specifically on Frank Sammut or anything else. If I had such information I would have taken immediate action, as I did.”

During the interview, Gonzi also insisted that his controversial decision to grant pardon to the oil trader had been accepted by all as a powerful tool, which is allowing the Police Commissioner and the Attorney General to carry out their investigations. 

“I also granted him [John Rizzo] the best tool possible. Pardons are not issued on a weekly basis, it’s a rare thing, but I have not shied away from issuing it as long as it produces results. The government has nothing to be ashamed of and we are committed to fighting corruption, wherever it comes from, whoever it is. I have stated that whoever plays with fire with me will burn himself and some did get burnt.”

Almost a year later, Gonzi would then say that he had been acting on a recommendation by Rizzo, then Police Commissioner. But during a sitting of the Public Accounts Committee, Rizzo said that the presidential pardon was first mooted by Gonzi. He would then inform Edgar Galea Curmi, then Gonzi’s head of secretariat, 

that Farrugia was interested in the presidential pardon after the government had given notice it was considering granting it.

Rizzo also confirmed that the presidential pardon was drafted by the police and office of the Attorney General while the Office of the Prime Minister approved it. The OPM, Rizzo said, had carried out several amendments “to make the presidential pardon more harsh”.

But while the police needed the presidential pardon to uncover any corruption between 2005 and 2011, no evidence of corruption emerged.

Michael Cassar said the investigative team was after what happened from 2005 onwards: “We made it clear that we didn’t need information pre-2005 because we could easily secure a conviction. Farrugia said that kickbacks stopped after Tancred Tabone left Enemalta.”

The PAC revealed that the investigative team never questioned Farrugia’s wife, Cathy Farrugia. Now, MaltaToday reveals that the police called her in for questioning just a few weeks ago. 

Just before she was called in, MaltaToday revealed that for eight years, Cathy Farrugia was responsible for drawing up and issuing ‘illicit’ invoices for her husband’s secret company Aikon Ltd.

At the time of the granting of the presidential pardon, it was not known that Cathy Farrugia had been the prime minister’s secretary for 10 years when Gonzi was a legal advisor at the Mizzi organisation.

Moreover, when pictures surfaced of himself with the Farrugias, Gonzi had told MaltaToday: “No I never knew them. I rarely... rarely did I meet or have any contact with the Farrugia family, which is a well-known family in Hamrun and in business circles. The only times we met were at public events, as evidenced by pictures published showing the open day at the Aviation Park where I met thousands of people including George Farrugia and a relative of his. It’s just a picture, which does not mean that I knew with whom George Farrugia was that day.” 

Asked specifically, whether he knew Farrugia’s wife, Gonzi said: “I don’t know who she is, I would not recognise her were I to meet her. It could be, maybe yes, maybe not, but I never had anything to do with her.”