Enough evidence has been found for four officials from auditing firm Nexia BT to be indicted for financial crimes, a court decided on Thursday.
At the end of a two-hour session, Magistrate Donatella Frendo Dimech said there is sufficient evidence for the four to face prosecution under a bill of indictment.
Nexia BT managing partner Brian Tonna, his business partners Karl Cini and Manuel Castagna, and office manager Katrin Bondin Carter face charges of money laundering, forgery and other crimes in relation to inquiries into former OPM chief of staff Keith Schembri. They are all pleading not guilty.
During Thursday's session, police chronicled a series of accounting transactions, often going into six figures, connected with the four officials as well as offshore companies. In one exercise, the police traced money funneled from Kasco Group, headed by former OPM chief of staff Keith Schembri.
A number of bank officials as well as financial and tax officers were also called in to present evidence.
In the last case on April 6, all four were granted bail following an unprecedented sitting in court on March 20, which saw 10 people jailed for financial crimes, pending their next hearing.
As it happened
Bill of indictment
11.15am There are no more witnesses for today.
The magistrate asks all four Nexia BT officials to stand.
She reads out her decree saying that there is sufficient evidence for the four to face prosecution under a bill of indictment.
The next sitting is on May 25.
Companies registered in BVI
11.10am Joseph Debono, representing the Commissioner for Inland Revenue is next.
He says that SPX Services Ltd and Willerby Ltd are not registered in Malta for tax purposes. The two companies are registered in the British Virgin Islands.
Joseph Saliba from JobsPlus takes the stand and presents employment histories for Tonna, Castagna, Cini and Bondin Carter as well as their companies.
KBT holdings, SPX and Willerby had no records of registered employees.
20 property transfers in name of four
10.55am Josette Galdes, director of Capital Transfer is the next witness.
She says information was traced on all four of the accused as well as a number of companies linked to them. There were five cause mortis transfers, 16 share transfers, three allotment shares and 10 property transfers related to Tonna.
Three property transfers were found related to Manuel Castagna, two transfers were related to Karl Cini, while five were connected with Katrin Bondin Carter.
Galdes ends her testimony.
Company accounts terminated
10.35am Dr Jan Camilleri from Me Direct Bank is next on the podium.
He says the accused were not bank clients, but some of them were involved in a number of companies: Spectrum, Eximus, Gladiator Ltd, BTA Ltd. All these company accounts were terminated.
The witness again comes along with password-protected CDs.
The magistrate asks him to return with new copies - there was no need for a password.
'We need to amend the law'
10.20am Rebecca Micallef from APS Bank takes the witness stand.
She says she will present financial information about Tonna, Cini, Castagna, Bondin Carter and all companies associated with them.
She presents statements dated 2015 to 2020.
David Spiteri from HSBC is the next witness. He is presenting bank documentation related to Brian Tonna as well as Caroline Tonna, Castagna, Cini, Bondin Carter, KBT Holdings, Nexia BT and BT international.
All documents are in boxes - this must be a logistical nightmare for both the prosecution and the courts.
Magistrate says it is impossible to number each document.
"We need to amend the law. Please get the message across."
Bank official's non-testimony
10.10am Silvio Chetcuti on behalf of Bank of Valletta takes the stand next. He presents a report containing relevant documentation, including due diligence forms.
There are volumes of transactions, he says, and so would have to be given direction on what to focus on.
The bank representative presents CDs with passwords. Magistrate says this is not acceptable - the CDs presented in court must be accessible to all.
Chetcuti says the bank was not told about this.
The court asks him to return with soft copies that are not password protected. And possibly hard copies too.
His testimony is suspended for today.
More figures and names
10am The Attorney General's lawyer says there is more to explain so the witness is authorised to proceed.
He cites more figures and names: Black Rock Energy Agency, Mossack, Nexia, EXIMUS Business Malta Ltd, Shanghai Energy...
The magistrate again intervenes: "just an overview please."
The witness now speaks of bulk payments and other dollar accounts - the name Black Rock Energy Agency is one that crops up frequently. Some of the transactions feature Keith Schembri.
Magistrate intervenes as figures read out
9.45am Transactions from local and foreign companies amounted to over €13 million.
The police offiical gives a breakdown of these transactions, explaining that some of them “had a different narrative”, though he doesn't explain what he means by that.
A transaction was also detected between the company and former Allied Group managing director Adrian Hillman.
He gives a breakdown of cheques received by BT, Cini, Castagna and Bondin Carter.
The magistrate tells the witness that it's useless reading from the report since it's duplicating certain issues... and the court reporters heave a sigh of relief!
545 transactions
9.40am Andre Farrugia from the police's FCID is the second witness. He was part of the task force and was engaged to analyse BTI Management Ltd's bank accounts.
Tonna, Cini and Castagna were directors at BTI Management Ltd. Castagna resigned from the post in December 2020.
BTI had a total of seven accounts at Bank of Valletta. Today it has four accounts.
There were over €2 million in deposits and 545 transactions from one account to the other.
The court places a publication ban over the account numbers he mentions.
Analytical work
9.30am Another analysis exercise on all bank accounts tracked money coming from Kasco Group (the company run by former chief of staff Keith Schembri).
It traced money going in and out.
"Do I need to go into them all," the witness asks.
Magistrate points out that all details are listed in the report and parties’ lawyers agree only request a copy.
Defence lawyer Stephen Tonna Lowell asks if the witness's work was purely analytical.
"I based my work on the transactions concerning these companies, based on bank documentation," the police replies.
Keith Schembri (left) has once again been linked to transactions with Nexia BT. On right is Brian Tonna.Nexia 'got almost €8 million, issued almost €2.1 million'
9.25am Police traced an invoice issued by BTI international to a UAE company. Another invoice collected during the magisterial inquiry conducted by magistrate Natasha Galea Sciberras was connected to a New Delhi company.
There were some €609,000 to savings account originating from Willerby Trading (whose ultimate beneficial owner is Tonna). There was another transaction of €200,000 from Karl Cini dated June 2016. Same day there was another transaction from Castagna.
Nexia BT got €103,000 in transactions from companies related to Nexia or Kasco group.
Nexia got total almost €8 million and issued almost €2.1 million, the police says.
We are finding it hard to keep up with the figures being cited by the police so bear with us please.
Transfer from Middle East
9.15am BT International Ltd received €130,000 in January 2015, originating from Swift transfer from Middle East in dollars.
These funds were transferred to MFSP day after and part of them moved to BTI account seven days later.
Keith Schembri's BVI company
9.10am Between 2015 and August 2020 there was an investigation into BTI Managements Ltd. There were monies emanating from Kasco Group and personal transfers from Brian Tonna and Keith Schembri.
The BVI company of Schembri had transferred some €70,000 to this account.
The witness is reading out a series of transactions in the form of cheques and transfers, each totalling tens of thousands of euros.
Transactions totalling €450,000
9.05am The first witness is Emanuel Schembri, a manager at the police's financial crimes unit.
In October 2020, he handled the analysis of the people investigated. Today he’s presenting a report about the transactions of various companies, focusing especially on Bank of Valletta accounts.
There were a total of 180 transactions totalling €450,000 to KBT from the company Zenith. Nine cheques were issued by MFSP/Zenith totalling more than €140,000. The reason for the payment of these cheques is unclear.
Good morning
9am Today's hearing is taking place in hall 9 but the press are following proceedings in hall 12 via video conferencing.
Who are the protagonists?
Brian Tonna: managing partner of Nexia BT and money man for Keith Schembri, Konrad Mizzi and others. Represented by lawyer Stephen Tonna Lowell.
Karl Cini: director at Nexia BT who handled a lot of the paperwork to open offshore structures for Schembri and Mizzi. An inquiry into secret company Egrant recommended that he be investigated for perjury. Represented by lawyer Stephen Tonna Lowell.
Manuel Castagna: a partner at Nexia BT who audited the accounts of Keith Schembri's company Kasco. Also sat on a three-person committee that awarded a deal to privatise three state hospitals to Vitals Global Healthcare. Represented by lawyers Michael Sciriha and Matthew Xuereb.
Katrin Bondin Carter: A manager at Nexia BT who backdated compliance documents for Nexia BT. Police told the court that she told them she was just following her bosses' orders. Represented by lawyer Franco Debono.