Keith Schembri claimed on Tuesday that he “cannot remember” authorising his financial advisors to open a secret Panama company for him. 

The former prime minister's chief of staff was giving evidence before a Public Accounts Committee, which is examining the Auditor General's damning report into contracts awarded to Electrogas to run a power station. 

It was Schembri's second appearance before MPs, who focused much of their questioning on his secret offshore company, Tillgate Inc, which was set to receive money from Electrogas shareholder Yorgen Fenech's company.

In testimony replete with inconsistencies, the ex-OPM chief of staff initially told parliament’s public accounts committee that he never authorised auditing firm Nexia BT to open the offshore company. 

“I authorised them to open a trust in New Zealand”, he said.

The reply was met with incredulity by Opposition MPs on the committee. 

“If you didn’t authorise them to open a company in Panama, how did you authorise them to open a bank account for that company,” PN MP Graham Bencini asked. 

Leaked documents from the Panama Papers leaks show Schembri authorised Nexia BT to open up a bank account in the Bahamas for his Panama company. 

Backtracking soon after, Schembri said he “cannot remember” giving Nexia BT the go-ahead to open the company.

Schembri said Nexia BT only informed him he needed a Panama company after he had already opened a trust in New Zealand.

“I did not know Panama was a tax haven. I didn’t ask any questions about it”," he said.

He said his money was going to go to New Zealand, not Panama.

17 Black

Another leaked e-mail from the Panama Papers detailed how both he and then energy minister Konrad Mizzi were to have millions paid into their Panama companies by 17 Black, owned by Fenech, who is awaiting trial for his alleged role in the murder of Daphne Caruana Galizia. 

The 2015 e-mail described 17 Black as a “target client” of Schembri and Mizzi’s Panama companies.

Schembri told the committee that the Panama company was set up for his future business plans, once he left politics.

“When born a businessman, you will always think like a businessman," he said. 

Schembri claimed not to remember whether it was he or Fenech who initiated the conversation about going into business together.

He said it was a “coincidence” that the Panama company was opened in tandem with Mizzi’s company. “So are you telling me Konrad Mizzi had the same target companies as you”, Carabott asked. “Ask him,” Schembri said.

On Egrant, the third Panama company set up by Nexia BT, Schembri said that at that stage, the company had not been used and therefore would have been owned by Nexia.

“You are a lawyer. You should know how these things work,” Schembri told PAC chairman Darren Carabott.

As the sitting wore on, Schembri appeared to grow increasingly frustrated and flustered by the line of questioning.

“I cannot use a bank account. I cannot use a credit card. I cannot carry out a bank transfer,” Schembri said of the police investigation following his 2019 resignation as chief of staff.

Schembri told the committee that throughout his years in government, he wanted to step down on multiple occasions, but that fomer prime minister Joseph Muscat never accepted his resignation.

He said he cannot recall speaking to either Muscat or Mizzi when Times of Malta revealed that 17 Black was owned by Fenech. Schembri also denied a claim by ex-deputy commissioner Silvio Valletta that he intervened to stop the police questioning Fenech on 17 Black.

'Lies' in the public inquiry

Valletta had told the public inquiry into journalist Daphne Caruana Galizia’s murder that Schembri had rung him up to call off the questioning.

“Are you going to question someone on the basis of an article in The Times,” Valletta said Schembri told him. Asked about this, Schembri said: “There were lots of lies told during the public inquiry. He said what it paid him to say."

He similarly rubbished ex-finance minister Edward Scicluna’s testimony in the same inquiry.

Scicluna had told a panel of judges that the big decisions by the government were taken by an inner circle that operated outside the confines of cabinet. Schembri says as finance minister, Scicluna would have been involved in major decisions.

“There was no kitchen cabinet”, he said. 

---

LIVE BLOG

---

Schembri spoke to Fenech on night of his attempted escape

3.54pm Schembri refuses to say whether he remained in contact with Yorgen Fenech, after he was identified as a murder suspect. He claims he never spoke to Fenech about Electrogas.

The questioning now turns to the night of Fenech’s attempted escape from Malta. Schembri confirms he spoke to Fenech on the night. Schembri says he phoned Fenech after receiving a message from him saying: “Don't leave me alone".

He says the fact that Fenech tried to leave Malta was of “no concern” to Electrogas.  The sitting ends here. Schembri will be summoned for further questioning next week.

---

---

Denies interfering with police 17 Black probe

3.49pm Schembri denies intervening to stop the police questioning Fenech in 2018 on 17 Black. Ex-deputy police commissioner Silvio Valletta had told the public inquiry into Daphne Caruana Galizia’s murder that Schembri had rung him up to call off the questioning. “Are you going to question someone on the basis of an article in The Times,” Valletta said Schembri told him.

“There were lots of lies told during the public inquiry. He said what it paid him to say,” Schembri said.

The inquiry had concluded that Schembri 'interfered' in the 17 Black probe. The inquiry had cited witness testimony as evidence of the way Schembri used his position of power to “directly” intervene in police probes into government corruption.

---

Schembri's resignation

3.45pm Questions again turn to Schembri’s resignation claims. Schembri says Muscat told him “to go live his life” when he was being treated for cancer towards the end of 2016. He said he returned to deal with the Afriqiyah Airways hijacking in December 2016, due to his good contacts in Libya. After that, he then went into campaign mode.

---

Daphne murder suspect

3.39pm Schembri is asked when he found out that Electrogas shareholder Yorgen Fenech was a suspect in Daphne Caruana Galizia’s October 2017 murder. “I decline to answer…I was bound by secrecy rules”.

The OPM chief of staff would sit it on briefings about progress in the murder investigation.  Schembri “cannot remember” if any steps were taken to evaluate and investigate the way in which Electrogas won the power station contract, in light of the murder suspicions.

---

Konrad Mizzi coincidence

3.35pm Schembri elaborates more on the Panama company. “I was told I could only open the trust [in New Zealand] if I also opened an offshore company.” Schembri says the plan was to close the Panama company, once the trust was set up. He says it was a “coincidence” that the Panama company was opened in tandem with Mizzi’s company. “So are you telling me Konrad Mizzi had the same target companies as you”, Carabott asks. “Ask him,” Schembri says.

---

'I did not know Panama was a tax haven'

3.30pm Schembri says Nexia BT only informed him he needed a Panama company after he had already opened a trust in New Zealand. “I did not know Panama was a tax haven. I didn’t ask any questions about it”. He says his money was going to go to New Zealand, not Panama.

---

Passport certified

3.23pm It is now pointed out that the diplomatic passport in the Panama Papers e-mail was certified by a notary as a true copy. Schembri again says he has no idea about this.

He says Nexia BT was given a copy of his diplomatic passport to handle his affairs in Malta.

"If I was smart I would have given them my other passport," he says. "Didn't you just say you did not have another passport," Bencini points out.

---

No consent for Panama companies

3.19pm The claims are getting more outrageous now. Schembri claims he never gave his express consent to Nexia BT to open a Panama company for him. “I authorised them to open a trust in New Zealand”.

“If you didn’t authorise them to open a company in Panama, how did you authorise them to open a bank account for that company,” Bencini questions.

“I hope you never have to go through what I went through over the last eight years,” an increasingly flustered Schembri says.

He is again asked if he authorised Nexia BT to acquire the Panama company for him. “I do not remember. No”.

---

Diplomatic passport

3.17pm Schembri is shown a printout of his diplomatic passport, published on murdered journalist Daphne Caruana Galizia’s blog.

“She also published my medical records and said I was going to die,” Schembri says.

“I did not ask you about your medical records. I am asking you whether you knew your diplomatic passport had been given to Nexia BT,” PN MP Graham Bencini says.

Schembri claims he did not pass on his diplomatic passport to Nexia BT specifically for this. “So you are saying Nexia BT sent a document without your consent,” fellow PN MP Darren Carabott asks incredulously.

---

Always a businessman

3.12pm Schembri claims he took a step back from his business interests while in government. He says the Panama company was set up for future business plans, once he left government.

“When born a businessman, you will always think like a businessman. “So were you already planning to leave politics in 2015?,” Carabott fires back.

Pressed further about these plans, Schembri is unable to say whether it was he or Fenech who initiated contact about them.

---

---

More emails

3.08pm More wrangling over the Panama Papers e-mails. PN MP Graham Bencini asks Schembri about a Nexia BT e-mail, in which Schembri’s diplomatic passport was attached.

Schembri’s lawyers are demanding to know where these e-mails came from. “They are in the public domain,” the PN MP says.

---

'Tried to resign four times'

3.07pm Earlier Schembri was asked questions about regrets. He said the only thing that he regrets is staying so long in politics.

He claims he offered his resignation four times, first in 2016, again in 2017, and the following year, right up until 2019. He finally left amid the political fallout from Yorgen Fenech's arrest in connection with the murder of Daphne Caruana Galizia.

---

Egrant 'not owned by anyone'

3.05pm Schembri adds that this means Egrant was not owned by a specific person. Schembri acknowledged that 17 Black “could have” been one of his Panama company’s target companies.

The ex-OPM chief of staff strikes an annoyed tone about the continued line of questioning. “I cannot use a bank account. I cannot use a credit card. I cannot carry out a bank transfer,” Schembri says.

In 2021, Schembri was charged with money-laundering, with all his bank accounts being frozen.

---

Who owns Egrant?

3pm Things are heating up now. Schembri is asked about the infamous Egrant. He says Egrant would have been owned by Nexia BT, as the entity that set up the company. “You should know very well how these things work,” he tells Carabott.

---

Panama Papers e-mails

2.52pm Darren Carabott reads out a series of Panama Papers e-mails detailing plans to set up the companies for Schembri and Mizzi. In one e-mail, Nexia BT’s Karl Cini says he had “spoken to the clients” about the process.“I was not copied in those e-mails. Ask Karl Cini”.

Easier said than done. Cini has steadfastly refused to answer any questions about the matter. 

---

That email

2.49pm A leaked Nexia BT e-mail address had identified 17 Black as the company that would pay in millions to Schembri’s and Mizzi’s Panama companies. 

“I did not write that [e-mail],” Schembri says. “So didn’t you know where the money was going to come from,” PAC chairman Darren Carabott asks. 

Times of Malta had revealed the existence of the e-mail in April 2018. On the same day, Schembri had issued a statement acknowledging that he had “draft business plans” with 17 Black.

---

17 Black scandal

2.45pm On to the 17 Black scandal. Times of Malta and Reuters had revealed in November 2018 how Electrogas businessman Yorgen Fenech was behind the secret company. Asked if he had spoken to Muscat about the revelations, Schembri claims not to remember. He similarly cannot remember whether he spoke to Mizzi about it.

A year on from the revelation, Fenech would be arrested and charged with the murder of journalist Daphne Caruana Galizia. 

---

'There was no kitchen cabinet'

2.42pm Schembri dismisses claims that there was an inner circle within Castille that took certain decisions. Ex-finance minister Edward Scicluna had described this inner circle as a “kitchen cabinet”. Schembri says that as finance minister, Scicluna would have been involved in major decisions. “There was no kitchen cabinet”.

---

---

Nexia BT's services

2.36pm Schembri says he never acted behind Joseph Muscat’s back, but he felt no need to inform Muscat about Mizzi’s enquiries about his “golden touch”. He says Muscat too used Nexia BT’s services, during his time as an MEP. Last time round, Schembri told the committee that it was therefore “obvious” that Mizzi too would use Nexia’s services. Schembri refuses to be drawn in on whether it is acceptable for a minister to engage in outsider business interests.

---

'Normal to be asked for financial advice'

2.31pm Schembri says it was normal for people to seek financial advice from him. He says he saw nothing strange in a minister asking for such advice. “For me, it was run of the mill. I never wanted to make money from government”.

---

That Midas touch

2.29pm During the last sitting, Schembri told the committee that Mizzi wanted to replicate the chief of staff’s golden touch. Questioned further about his golden touch today, Schembri says he cannot remember where the conversation he had with Mizzi had taken place.

It happened about 10 times, Schembri says to fits of laughter.

“Did you tell him 10 times to go to Nexia BT?”, PN MP Darren Carabott asks. Nexia BT was the financial advisory firm used by Schembri and Mizzi to open secret companies in Panama.

---

Details, details

2.25pm Schembri remains vague on the precise details about whose idea the gas power station was. Ex-energy minister Konrad Mizzi and his associate David Galea were involved in the details. Louis Grech, the former deputy prime minister, was also involved in the number crunching.

---

And we're off

2.22pm PAC chairman Darren Carabott kicks the grilling off by asking Schembri to explain the origins of Labour’s 2013 proposal to build a gas-fired power station.

How did this proposal end up in Labour’s election manifesto?

“Gas was the obvious choice,” Schembri says. The major focus was always on reducing energy bills by 25%.

---

What did Schembri say in his previous appearance?

2.11pm. While we wait for the sitting to start, here's a summary of Schembri's previous testimony when he:

• Repeatedly downplayed the extent of his knowledge of the controversial power station project and those behind it;
• Said he had left politics poorer than when he started it;
• Described how former energy minister Konrad Mizzi thought Schembri had 'the Midas touch' and so chose to use his auditors Nexia BT;
• Said it was a coincidence that he and Mizzi both opened the exact same offshore company structure at the same time;
• Insisted he had no idea that his auditors sat on the evaluation committee that chose Electrogas as the consortium;
• Defended holding secret Panama companies as "run of the mill" and the only way to avoid leaks from Bank of Valletta.

---

Keith Schembri arrives (after greeting Konrad Mizzi's father)

2.05pm Keith Schembri entered parliament a short time ago, flanked by his lawyers, Edward Gatt and Mark Vassallo.

Schembri paused to shake the hand of a passer-by, who turns out to be former energy minister Konrad Mizzi's father.