Updated 2.45pm

Keith Schembri, Konrad Mizzi, Yorgen Fenech and others all pleaded not guilty to a raft of serious criminal charges linked to the Electrogas power station project on Wednesday. 

Prosecutors pressed charges against seven individuals and four companies linked to the Electrogas power station, of which Fenech is a shareholder. The charges follow a years-long magisterial inquiry into allegations concerning illicit payments linked to the Fenech-owned offshore firm 17 Black. 

Defendants stand accused of corruption, trading in influence, criminal association and perjury. They all pleaded not guilty.  

The magistrate also approved a request to freeze the assets of the accused, with freeze orders ranging from €18 million to roughly €200,000. 

Clockwise from top left: Paul Apap Bologna, Keith Schembri, Konrad Mizzi, Yorgen Fenech, Mario Pullicino, Karl Cini and Brian Tonna were arraigned on Wednesday.

Fellow Electrogas shareholder Paul Apap Bologna was also charged, as was Mario Pullicino, the local agent for the floating storage tanker fuelling the power station. 

So too were Brian Tonna and Karl Cini, the accountants who are alleged to have planned the money transfers involved. Tonna was also on a key committee that selected the Electrogas bid for the lucrative power station project.

All the accused were charged under summons rather than arrest, meaning they did not have to request bail and were free to return home following the court sitting. 

Companies accused of crimes

Nexia BT, the accountancy firm that Tonna and Cini led, was also charged separately. BTI Management Limited, which is owned by Tonna, New Energy Supply Limited - a Fenech-owned firm - and OEGP Limited, owned by Pullicino, were also charged. 

Four other companies - the Fenech-owned Wings Developments and Wings Investments, Apap Bologna's Kittiwake and Pullicino's EN 3 - are being criminally charged in a separate case. 

Under Maltese law, companies can be held criminally liable if a company director, secretary or top manager commits an offence for the benefit of the company. 

While individuals can be jailed if found guilty, companies convicted of crimes can be fined anything between €20,000 and €2 million. The courts can also impose sanctions on companies or suspend or cancel any licences they may possess. 

What is the case about? 

Times of Malta first revealed that prosecutors would be pressing charges against those involved last month, following the conclusion of a years-long magisterial inquiry into allegations surrounding 17 Black.

Leaked documents indicated Fenech intended to use the offshore company to send millions of euro to Schembri and Mizzi via secretive offshore structures in Panama.

At the time, Fenech was leading the Electrogas consortium that won a €450 million deal to build and operate a gas-fired power station in Delimara. Mizzi was Energy Minister and Schembri was the chief of staff at the Office of the Prime Minister. 

Apap Bologna and Pullicino also had secret offshore structures similar to 17 Black. 

Millions in suspicious transactions 

Investigators found a complex web of transactions running into the millions between companies owned or controlled by the defendants, the court heard on Wednesday.

Police Inspector Brian Camilleri cited some examples during his testimony: €3 million went through Cifidex in November 2015, while 17 Black received over €300,000 from OEGP and then €3 million just a few days later.

17 Black sent three separate payments amounting to roughly €1 million to a company linked to Chinese national Chen Cheng, Macbridge, while Fenech’s Wings Investment sent €620,000 to New Energy Supply Limited.

Times of Malta had exclusively reported on many of these deals in the previous years. Fenech was exposed as the owner of 17 Black through a joint investigation between Times of Malta and Reuters.

Schembri, Fenech and Mizzi had "weekly" discussions on WhatsApp, the inspector said, describing one message in which Fenech sent Mizzi and Schembri a photo of two men, one who turned out to be part of a prominent family member in Dubai. 

"Dan hu ir-re ta' Dubai [this is the king of Dubai]", Fenech wrote.

Under cross-examination, the inspector confirmed that no transactions between 17 Black and the offshore companies owned by Schembri and Mizzi were found. Nor were any transactions between 17 Black and any MP or public official found, he said. 

Police began investigating in March 2018

Police began investigating the case in March 2018 and formally requested an inquiry into it in September of that year, Inspector Camilleri said while testifying. 

The inspector cited “intelligence” about the various offshore structures owned by the accused as well as an email naming 17 Black as the “target client” of Mizzi and Schembri’s offshore firms. 

Inspector Camilleri told the court he was put on the case in April 2020. 

The Electrogas power station in Delimara. Photo: Mark Zammit Cordina

Millions in assets frozen 

Prosecutors were successful in their bid to have freezing orders placed on the assets of the various defendants. 

Fenech is subject to an €18 million asset freeze, Apap Bologna had €390,000 frozen and Pullicino subject to a €200,000 freeze. 

All the other defendants, including the companies cited, are subject to asset freezes of €12 million each.  

Fenech’s lawyers sought to have the case against their client dismissed, arguing that the facts were identical to those in another case Fenech is being charged in, concerning the alleged leaking of confidential information by a former police superintendent. 

The magistrate dismissed that application following a five-minute deliberation.

Lawyers representing other defendants in the case also raised objections about court experts used in the magisterial inquiry and asked for their evidence to be discarded. 

They cited Serbian forensic accountant Miroslava Milenovic and UK-based forensic analysis firm Harbinson Forensics - both of which were used in other magisterial inquiries into offshore company Egrant and the deal to privatise three state hospitals. 

Defendants in the latter case, among them Schembri and Mizzi, have questioned the validity of those experts. During Wednesday's hearing, defence lawyers asked for the experts' conclusions to be discarded as evidence. 

Following deliberation, the magistrate also dismissed that request. 

The case continues on February 19.