Two company directors of a Pietà restaurant, pleading not guilty to money laundering charges, are challenging the law that allows a blanket freeze of assets which they claim to be “draconian, extreme and disproportionate”.
Keith Testa, 29, and Carlos Dimech, 27, were charged last year in their personal capacity as well as in their role as directors of Pietà Marina Caterers Ltd operating Onda Blu fish restaurant at Sa Maison.
Those charges had followed investigations into suspected financial crimes by former footballer Darren Debono.
While criminal proceedings continue, lawyers for the two accused have filed a constitutional case challenging the law that allows the prosecution to request a freezing order over all assets of persons charged with money laundering, making no distinction between proceeds of crime and other assets derived from legitimate sources.
Defence lawyer Stefano Filletti had immediately argued that such distinction needed to be made when the criminal case kicked off in June last year.
But the prosecution had rebutted that the law made no distinction and the court had proceeded to issue the blanket freezing order, save for a monthly allowance of just over €13,000 for each of the accused.
Filletti had pointed out that redress would be sought “elsewhere”.
Seven months down the line, those arguments were reiterated even more forcefully during a first hearing in separate proceedings filed by Testa and Dimech before the First Hall, Civil Court against the State Advocate, the Attorney General and the Police Commissioner.
When making preliminary arguments before Madam Justice Anna Felice on Tuesday, Filletti did not only challenge the law on freezing orders, but also questioned the “diametrically opposed” stance that seemed to have been adopted by the AG and the State Advocate in their replies to the applicants’ claims.
Whereas the AG is arguing that the law precluded the courts from limiting a freezing order, the State Advocate argued that this was a court order and subject to court discretion.
Freezing orders were intended as a precautionary measure to prevent money laundering suspects from disposing of assets derived through criminal activity, argued Filletti.
But this measure was never intended to uselessly frustrate the persons whose assets were affected by the freeze, argued the lawyers, pointing out that that was precisely what such orders were doing.
Besides immovables, the freezing order also impacted pensions, life savings, inheritances and other assets legitimately acquired, wreaking havoc in people’s lives.
By failing to distinguish between “the good and the bad” the law meant that people could not pay taxes, insurance policies, car insurance covers, VAT and other ordinary expenses, having to get by on the statutory monthly allowance.
The current law on freezing orders failed to provide an effective mechanism to limit such orders to the proceeds of crime and was thus “draconian, extreme and disproportionate”.
This resulted in an unjustified and disproportionate interference in a person’s right to enjoyment of private property and consequently breached fundamental rights, argued the lawyers, calling upon the court to provide an adequate remedy.
Lawyers Stefano Filletti and Nicole Galea are assisting the applicants.