Due diligence report comments on the rapport with Yorgen Fenech and the delay in filing tax returns

Beppe Galea

Tista' taqra bil- Malti.

“Communications with the beneficial owner of 17 Black should have been terminated abruptly once Mr Yorgen Fenech had been identified by the press as being the beneficial owner of the company, at least until such time as the allegations made had been cleared.” This was the opinion of the three members of the panel Dr Antonio Ghirlando,Chairperson, Auditor Mario P Galea and notary Dr Clyde La Rosa, chosen by the Partit Nazzjonalista to conduct due diligence reports on the suitability of Dr Adrian Delia current party leader and Dr Bernard Grech, contender for the same post.

On Dr Grech, the panel remarked that it was regrettable that he had filed in his tax returns late. “The panel notes the regularisation of Dr Grech’s tax position as declared by the inland revenue, however, also notes with regret that such regularisation was only effected after a number of years. Such regret has also been expressed by Dr Grech in public” said the report.

 

 

On Dr Adrian Delia

The report noted that Delia had been the subject of adverse media reports on 4 main occasions:

  • The issue of the Jersey Bank Account
  • The Boris Arcidiacono ‘episode’
  • The Miroslav Kopric ‘episode’
  • The Yorgen Fenech allegations

Ongoing task for Delia to meet financial commitments

Section five of the report dedicated to Financial Affairs dealt with allegations relating to Delia’s finances in general.

With regards to Delia’s financial affairs, the report said that the financial statement and documentation presented “suggest that meeting current financial commitments is an ongoing task being faced by Dr Delia”.

On the allegation originating from the writings of Daphne Caruana Galizia, that Delia had an offshore bank account in Jersey which he allegedly used to channel illegal earnings from prostitution, the report said that “What is particularly of concerns the allegation made in the press reports that an investigation that has been conducted by the FIAU which allegedly concluded that Dr Delia and his bank account ‘may have been used for money laundering’. Any report by the FIAU would only be made after an investigation has been carried out on the matter” said the report.

The report also noted that Delia had denied the allegations made, repeatedly.

The Boris Archidiacono ‘episode’ – No wrongdoing on Delia’s part

The Boris Archidiacono ‘episode’ revolved around the claim for a ‘success’ fee by Delia and his legal partner. The fee was claimed for the ‘success’ in obtaining a bank loan in favour of Boris Archidiacono. Archidiacono refused to pay the fee and further claimed that after debts were settled a considerable sum was paid to Deila by the Bank without his consent. The report said that while the concept of ‘success fees …is at best ethically dubious’, the latter had been investigated by the Bank and the Chamber of Advocates and found no wrongdoing on Delia’s part.

On the allegation of ‘kidnapping’ – Could have been handled better

An allegation of ‘kidnapping’ was tied to the Miroslav Korpic ‘episode’ where it was alleged that the then Birkirkara FC goalkeeper had been forcibly taken, by the club officials including Delia and ordered to divulge wrongdoing. Kopric sued the club and the club denied the coercion. In this case the report said that the matter could have been handled better, more formally to avoid perception of coercion.

The Whats App saga

With regards to the relationship with Yorgen Fenech, indicted for murder of Daphne Caruana Galizia, the report’s comments were extensive.

The report, noting the familiarity of the Maltese Political caste with that of the business caste, said that it was not the fact that communications take place but the nature of communications which take place. “Communications with the beneficial owner of 17 Black should have been terminated abruptly once Mr Yorgen Fenech had been identified by the press as being the beneficial owner of the company, at least until such time as the allegations made had been cleared,” said the report. The report added that to consider taking up Fenech’s offer for lunch, if proved true, “would constitute and serious lack is judicious behaviour on Dr Delia’s part which would undermine his credibility and that of the party he leads in its fight against corruption.”

Delia’s business interests

In assessing his business interests in Mgarr Developments Ltd and Carnaby Ltd, the report said that with Delia standing surety for €7.2 million, he was financially exposed and dependent on the bank for the executive title of the development. The report noted that the proposal that the company is listed on the Stock Exchange would mean that the company “would have to overcome serious legal and regulatory hurdles beforehand”.

On Bernard Grech

The report noted that Grech had had very little media exposure and the only adverse media report had been related to his failure to submit his tax returns and pay his tax on time.

The report noted that as a sole legal practitioner, there was no detectable wrongdoing and that the minor shortcomings noted were rectified.

The report went into the issue of the tax returns and tax payments which Grech had failed to submit in a timely manner. The report added that the panel had been provided with a compliance certificate issued by the Inland Revenue Department dated 2.10.2020 stating that Grech’s slate was clean.

The Panel noted with regret that such regularisation was only effected after a number of years and that Grech himself expressed this regret in public. The report added that politicians should lead by example and be judged by higher standards.