An anti-corruption commission has absolved former junior minister Michael Farrugia over a meeting with business magnate Yorgen Fenech, almost four years after it was asked to investigate the matter. 

The  Permanent Commission Against Corruption said it was "satisfied" that the two had discussed Portomaso during a 2014 meeting, and not plans to allow high-rise developments in Mrieħel.

The commission ruled that Farrugia had not gained anything from his sudden order to include Mrieħel in a government policy on high-rise buildings on March 5, 2014 - the same day he met Fenech, at the time a Tumas Group executive director, at the Office of the Prime Minister.

Fenech, who was politically responsible for planning at the time, was therefore absolved by the commission.

The commission had been asked to probe the matter by MEP candidate Arnold Cassola, who filed a complaint in December 2019.

Cassola wanted the commission to look into Fenech’s close relationship with top officials, including former prime minister Joseph Muscat. 

His complaint cited reports that Fenech had gifted Muscat expensive watches and bottles of Petrus wine, and asked the commission to see whether those gifts and relationships influenced policy decisions.

Months after Fenech met with Farrugia, the Tumas and Gasan groups filed an application to build four towers in Mrieħel.

The commission’s report was tabled in Parliament on Monday by Justice Minister Jonathan Attard in reply to a parliamentary question.

What Farrugia told the Commission

The commission heard the testimony of various people involved, including that of Farrugia, who now serves as a Labour backbench MP. 

Farrugia told the commission that Fenech was one of the many investors, contractors and NGOs that he met at Castille, where his office as junior minister was based.

He said they had discussed land reclamation during the meeting, as one of the 23 projects proposed by the Tumas Group was to extend its Portomaso development in St Julian's. They never discussed Mrieħel, Farrugia insisted. 

Farrugia told the commission that the new high-rise policy actually ended up reducing the value of the Four Towers project - now the Quad - by around €12 million. He insisted that Fenech never asked him to delay the new policy and never discussed Mrieħel with him. This was the only time he ever met Fenech, he said. 

What Muscat told the Commission

The commission also heard the testimony of Joseph Muscat, who confirmed that he had received three bottles of Petrus wine worth around €2,000 each from Fenech, as well as a watch. 

He however insisted that the wine was always kept in the state's possession and that he never wore the watch, and vehemently denied ever being the recipient of corruption. 

When asked about the legal notice issued shortly after Farrugia met Fenech, Muscat told the commission that processes to introduce new laws take weeks, and he could not imagine something being introduced "on the day". 

The commission, headed by former judge Lawrence Quintano, with former police chief John Rizzo and lawyer Philip Magri as members, concluded that there was no evidence to conclude that the watch and expensive wines were sent in exchange for Fenech to obtain any economic advantage in Mrieħel.

"If anything the consortium proposing the project stood to lose from the change in policy," the commission said. 

Moreover, it found no evidence of trading in influence since it did not result that there had been any “go-between”.

“The Commission is satisfied with the explanation provided by Dr Farrugia on the Mriehel towers and that the meeting with Yorgen Fenech was not about Mriehel but about Portomaso. The Commission is therefore closing the case based on evidence it had collected,” it said in the conclusion of its report.

In August, parliament's Standards Commissioner found that Farrugia breached ethical standards by giving the wrong information to Times of Malta about the way Mrieħel was included as a high-rise building zone. 

It was Times of Malta that revealed how Farrugia ordered the Planning Authority to allow high-rise developments in Mrieħel on the same day of a meeting between himself and Tumas magnate Yorgen Fenech in 2014.

In a letter to the authority’s CEO, Farrugia instructed: “Mrieħel is to be considered as an appropriate location for tall buildings with the intention to create a strategic employment node.”

In his report about the issue, Standards Commissioner Joseph Azzopardi concluded that Farrugia had misled Times of Malta when he claimed that the decision to include Mrieħel as a high-rise zone was taken by a committee.

Azzopardi made it clear in his report that the probe was not about whether there was wrongdoing in Farrugia's 2014 meeting with Fenech, as the law precluded him from investigating matters that took place prior to the setting up of the Standards Commissioner's office. 

Rather, it was based on claims made by Cassola in 2020 that Farrugia had lied about the meeting and about how the decision to include Mrieħel as a high-rise zone came about.