PN: Zaren Vassallo €250,000 loan repaid, pending payments remain for other services

A €250,000 loan issued by construction magnate Zaren Vassallo in 2012 to the Nationalist Party was paid in full by 1 August 2016, a letter seen by MaltaToday shows.

The money was loaned at no interest.

However, a number of payments to Vassallo for services rendered to the PN remain pending and are in the process of being paid, secretary general Rosette Thake and executive president Ann Fenech have said.

Whilst allowing journalists to see a copy of the letter, carrying the party’s emblem, the PN has refused to make it public.

MaltaToday was told during a meeting at the PN headquarters that the letter, dated 1 August 2016, had been accompanied by a cheque for €165,000, “being the last payment in full and final settlement for the original loan of €250,000 given to Media.Link Communications Co. Ltd. on 2 July 2012 by the Vassallo Builders Group.”

The letter was signed by Vassallo and the party’s financial controller, Malcolm Custo.

Justice Minister Owen Bonnici has challenged the PN to prove that Vassallo’s loan was in no way linked to the decision by the previous PN administration to allow him to acquire a 21,000 square-metre tract of government land, freehold.

Read more Zaren Vassallo got public land for cheap, but Christmas is shutting out the Lowenbrau inquiry

In its report, the National Audit Office established that the transfer of land in Qormi, for the contract of exchange dated 5 June 2012, was in accordance with legislation but disputed the basis of this exchange in view of its “serious reservations” regarding the valuation of the land.

However, both Fenech and Thake reiterated that the loan had nothing to do with the Lowenbrau deal: they argued that the report confirmed there had been no political interference in the deal.

“The Auditor General himself made it clear that Azzopardi had not intervened in the land contract,” Thake said. “Azzopardi had even opened legal proceedings against Vassallo to recover the full value of the land.”

Fenech confirmed that there were still outstanding bills payable to Vassallo Group who, like other creditors, was still owed for services rendered.

“That email referred to outstanding bills in general and had nothing to do with the €250,000 loan,” she said, referring to replies she gave to l-Orizzont.

Fenech refused to explain the nature of services rendered and bills pending, citing "confidentiality" reasons.

Thake also dismissed suggestions that the PN had managed to pay the loan in full under the PN cedoli scheme.

Bonnici has taken former lands minister Jason Azzopardi to task over a report by the Auditor General showing that the Qormi land, formerly leased to the Marsovin winery, was “devalued” just before Marsovin sold it to Vassallo Builders in 2009.

Azzopardi has sued Bonnici for defamation, after the minister claimed he had information in hand - which the NAO was not even privy to – showing that Azzopardi had told Vassallo “a compromise” would be reached.

Labour Party's reaction

In a statement, the Labour Party said the news that the PN owed more money to Zaren Vassallo, was cause for greater doubt and suspicion.

The PL noted that The Malta Independent yesterday quoted PN sources saying that the party had paid back €100,000 of the €250,000 loan, only to report some hours later that another source revealed that the full loan had been paid back in full in August.

“The PN is getting caught up in its own lies,” the PL said. “Which is the true version of events? How much debt did Zaren Vassallo forgive the Nationalist Party?”