A magistrate has demanded proof from the prosecution in a money laundering case involving an auctioneer, a financial service provider and a Ukrainian oligarch with business links to the US President elect's son.
Pierre Grech Cumbo Pillow, 44, an auction firm owner from Ta’ Xbiex and financial services practitioner Jason Vella Tabone, 37, from Qormi, stand accused of laundering millions of euro.
The case centres around the sale of an oil rig and was before Magistrate Donatella Frendo Dimech, who heard submissions on Thursday over whether there is enough evidence for the men to be placed under a bill of indictment.
“Show me the proof,” she demanded, warning police and the prosecution not to base the case on suspicions.
What is the case about?
It emerged in court that the police investigations began over an allegedly suspicious transaction over the sale of a disassembled oil rig.
The transaction involved Ukranian energy giant Burisma Group, which had US-President-elect Joe Biden’s son, Hunter, on its board of directors until April 2019.
It passed due diligence tests including one by Malta-based Satabank, which processed the transaction and has since lost its licence to operate.
The court heard how the police investigation began over the involvement of Burisma's founder, Mykola Zlochevsky, a Ukrainian oil and natural gas businessman, politician and oligarch.
Zlochevsky was Minister of Ecology and Natural Resources between 2010 and 2012. He was investigated for several offences in the past over embezzlement but was never charged.
It also emerged that in 2014, Zlochevsky rented Grech Cumbo Pillow’s Ta’ Xbiex apartment when he was applying for Maltese citizenship through the golden visa programme, the IIP.
What are the magistrate's concerns?
Magistrate Frendo Dimech said she needed to see evidence of "actual criminal activity".
“I need to see evidence that the money allegedly involved in the transaction over the sale of this oil rig was dirty money," she told the prosecution. "Your case has to be based on evidence on the tainted origin of the funds and not the money laundering set up you’re saying you saw or were informed about. It is pivotal to the case."
Police Inspector Brian Paul Camilleri told the court that letters rogatory had been sent but the replies have not yet been received.
To this, the magistrate replied: “Then why all this urgency to prosecute? Why did you tell the magistrate presiding over the inquiry to close the inquiry so that you could prosecute if this information was still lacking? What evidence is there on the predicate offence?”
A predicate offence is the illicit source of funds - the reason the money had to be laundered, such as for prostitution or the sale of drugs.
What does the prosecution say?
Lawyer Cinzia Azzopardi Alamango, from the Attorney General’s office, replied that the prosecution contends it is embezzlement and that the pair were third-party money launderers.
“But you’re not answering my question: where is the proof?” the magistrate asked, to which the lawyer replied: "There are three reports in the inquiry which clearly state there is a case. It’s all there”
Inspector Camilleri said that the structure fits within the scheme of a money laundering operation and insisted the money was dirty money.
“Then give me the proof,” the magistrate replied.
“There's enough evidence in the inquiry," the inspector responded.
"Zlochevsky was a suspect with Interpol. In a statement, Vella Tabone said he knew that Zlochevsky was being investigated abroad so even the fact that he knew he was suspicious was enough,” Azzopardi Alamango said, prompting an uproar from the defence.
What happens next?
The defence team, composed of lawyers Giannella de Marco and John Refalo for Grech Cumbo Pillow and lawyers Michael Sciriha, Albert Zerafa and Matthew Xuereb, insisted that they were contesting what is known as prima facie – that there was enough evidence for the case to be heard.
“We are contesting it. We think there is absolutely nothing. The police did not even do the basic investigations, such as to see whether the sale of the rig really happened or check where the money was coming from. The prosecution had documents in Ukranian and did not even bother translating them. This was a simple transaction through a Maltese company. Due diligence was done and it was approved by a bank," de Marco said forcefully.
The magistrate deferred the case for a decree to January 11. However, she ordered the prosecution to attend another short sitting planned for January 5 to show the court “admissible evidence” on the predicate offence.