Yorgen Fenech could cost his family more than €50 million should he breach his bail conditions, according to calculations by Times of Malta.
While Malta’s court system does not have any publicly available data about past bail orders, criminal lawyers who spoke to Times of Malta described it as the largest bail order in Malta’s history.
Fenech was granted bail at a hearing on Friday morning but will only be allowed out of Corradino Correctional Facility once a court confirms that his aunt has temporarily deposited her share of the family business with the government.
Moira Fenech told a court earlier this month that she was willing to serve as a guarantor for her nephew and that he would live in a property close to hers belonging to the family-owned Tumas Group.
According to the Tumas Group’s audited accounts for 2022 – the most recent it has filed – the group’s total equity stood at €339 million that year. Company CEO Ray Fenech testified that Moira holds a 15.46% share of the business. That means her share was valued at just over €52 million in 2022.
The court's bail decree makes it clear that it intends to seize Moira Fenech's share should Yorgen Fenech breach bail. Noting prosecution concerns about the unusual provision, the court said it “sees no obstacle” to the government seizing the shares permanently.
Breaching bail conditions would also cost Fenech an €80,000 deposit and €120,00 personal guarantee - relatively minor losses compared to what his aunt has on the line.
Those conditions include a requirement to stay away from the coastline and airport, steer clear of any witnesses and stay indoors between 5pm and 11am every day.
Even if Fenech falls foul of those rules and Moira Fenech loses her share, she is likely to continue being a major Tumas Group shareholder: her brother Ray Fenech told the court that she will be inheriting her late sister’s share of the business, as she named Moira her sole heir.
Lawyers who spoke to Times of Malta said they could not recall any other instances in which a court required shares to be put up as collateral for bail. They were also unable to cite any previous cases with comparable sums required for bail.
The scale of the order is only comparable to bail orders made in some high-profile US cases.
Bernie Madoff, who ran a notorious $65 billion Ponzi scheme, was allowed out on bail in 2008 after posting a $10 million bond. Another conman, crypto guru Sam Bankman-Fried, satisfied a $250 million bail requirement by posting his parents’ home and assets as collateral.
In a handful of other cases, US judges issued bail orders running into billions of dollars. But in all those cases, bail was subsequently reduced to six-figure amounts.
Fenech is pleading not guilty to complicity in the murder of journalist Daphne Caruana Galizia. He was arrested in November 2019 as his yacht exited the Portomaso Harbour and has been in police custody since he was formally charged some weeks later.
Two brothers who confessed to carrying out the Caruana Galizia assassination were sentenced to 40 years each in 2022. A third hitman received a 15-year prison sentence after pleading guilty in 2021.
Since being charged, Fenech has also been charged with other crimes related to that case. In one such case, the self-confessed murder middleman, Melvin Theuma, was given a phantom government job. In another, a former top police officer is suspected of leaking secret investigation information.
Fenech's bail request hinged on a legal requirement entitling defendants to bail if 30 months have passed since a bill of indictment against them has been issued.
Daphne Caruana Galizia's son Matthew said he was "shocked but not surprised" by the bail decision. He placed the blame on the prime minister and justice minister for having failed to reform a criminal court system that is plagued by years-long delays.
The Tumas business empire
The Tumas Group is one of Malta’s biggest companies, with interests in the real estate, hospitality, energy, cargo and casino sectors.
Founded by Tumas Fenech in the 1970s as a furniture and household goods importer, the company now owns major hotels like the Hilton and Dolmen, two casinos and a swathe of residential and commercial real estate. It is also a shareholder of the Electrogas power station in Delimara and The Quad development in Mrieħel, with other interests in cargo handling at Valletta and a hotel in France.
Its audited filings shed light on the scale of its operations.
In 2022 the company reported total assets of just over €493 million against liabilities of roughly €154 million. Revenues topped €97.5 million and the group ended the year with net profits of €47.5 million, rebounding after a difficult few years due to the COVID-19 pandemic. In recent years, the company has paid out roughly €4.5 million a year in dividends to its shareholders.
Given that it is privately owned, calculating the Tumas Group's acquisition value is tricky, as there is no publicly listed share price to establish a baseline for how much investors believe it is worth.
However, two accountants who analysed the company's balance sheet for Times of Malta separately concurred that its overall equity - which equates to the group’s total assets when all its liabilities are deducted - was a fair measure of the firm's value.
Equity calculations do not take into account what in business terms is described as goodwill – intangible assets such as the value of a company’s workforce and existing customer base, intellectual property and brand value.