Blanket freezing orders targeting the assets of those facing money laundering charges are to be assessed in the light of the duration of criminal proceedings which needed to be fast and efficient, a court said on Monday.
The issue was the centre of lengthy submissions when Nexia BT directors Brian Tonna, Karl Cini and Manuel Castagna, along with financial controller Katrin Bondin Carter, returned to court for the ongoing compilation of evidence wherein they stand accused of money laundering and financial crimes.
Since their arraignment in March last year, the three directors and their companies have been under freezing orders over all assets, both movable and immovable, save for an annual statutory allowance of just over €13,000.
“Such carpet bombing by the prosecution means that Nexia had to fire around 160 employees. Those people lost their job because of this attachment order,” argued defence lawyer Stephen Tonna Lowell.
He said the courts’ interpretation appeared to be changing, and “one of the finest decrees on freezing orders” was delivered by Madam Justice Edwina Grima in the Progress Press case where the court held that such orders could be limited to the quantified amount of proceeds of crime.
In the case of former Progress Press chairman Vince Buhagiar, the freezing order was reduced to the amount of illicit gains determined by the prosecution.
Not so in respect of Nexia, argued the lawyer.
“Justice is represented as a blindfolded woman and there should be no different treatment just because the surname is Buhagiar instead of Tonna or Cini,” went on Tonna Lowell, pointing out that except for BT international, the prosecution had attributed no illicit gains to any of the other accused.
A crippling impact on the company
Defence lawyer Giannella de Marco also questioned the proportionality of such blanket freezing order that had a crippling effect on the company.
Presiding magistrate Donatella Frendo Dimech had upheld requests to vary and reduce similar orders in the case of Bondin Carter, Vincent Buhagiar and Yorgen Fenech, she observed.
“The cases may vary but principles remain the same… and principles must apply equally to all persons and companies before the courts,” said de Marco.
Attorney General lawyer Antoine Agius Bonnici countered that the courts had delivered contrasting decrees on this issue, even because this was a relatively new evolving subject.
However, most of those decrees rejected requests to vary freezing orders.
“But they are putting emphasis on proportionality. Being proportionate today does not mean that it remains so tomorrow,” interrupted Magistrate Frendo Dimech.
“It’s a house of cards. Proportionality must be assessed in light of the duration of proceedings,” said the court, highlighting the need for such cases to be handled efficiently and without delay.
“There was no useless delay,” remarked the prosecution lawyer.
“Proportionality loses substance the longer the cases protract,” insisted the court, adding that evidence “should be ready before a person is charged.”
In terms of law, if a person accused of money laundering is ultimately acquitted, he needs to file civil proceedings to prove that the assets seized in the criminal proceedings were derived from a legitimate source.
“The law is what it is. It presumes that all assets are illicit gains and at compilation of evidence stage, the court is not competent to distinguish,” argued the prosecution.
But de Marco argued that the court was to adopt the same line of action as it had done in the case of Bondin Carter and Buhagiar.
“In those cases, the court did not simply pay lip service,” said de Marco, urging the court to decree in a manner that would respect the fundamental rights of the accused.
A decree will be delivered in chambers.
Lawyer Franco Debono is counsel to Bondin Carter. Michael Sciriha and Matthew Xuereb are counsel to Castagna.
The case continues in June.