A Pakistani national behind suspicious payments to former prime minister Joseph Muscat is facing a million-dollar fraud lawsuit in the United States.
Wasay Bhatti is at the centre of a web of Swiss companies that have both received and made notable payments to players in the Vitals Healthcare hospitals scandal, including Muscat.
Last month, Bhatti was accused by a US medical company of making “false representations” and, consequently, running off with $1.47 million (€1.49 million) meant for the supply of COVID-19 antigen tests.
According to a claim filed by Premier Biotech in a Minnesota court, Bhatti reneged on the deal to supply the tests and failed to return the $1.47 million down payment given to him.
The lawsuit was filed against Bhatti personally as well as Swiss company Spring Healthcare, which he runs.
Spring Healthcare describes itself as a partner of Steward International, the US company that took over the Maltese hospitals contract from Vitals in 2018.
Muscat signed up as Bhatti’s “consultant” mere weeks after resigning as prime minister in January 2020.
Times of Malta revealed last year how he went on to receive €60,000 worth of payments from two of Bhatti’s Swiss companies – Accutor and Spring X Media.
Investigators suspect the payments could be a cover for kickbacks linked to the Vitals deal, though Muscat insists they were for legitimate work he carried out for Bhatti.
Muscat’s home and office were searched by police officers in January in connection with the payments and consultancy deal with Bhatti.
Bhatti, via Spring Healthcare, agreed to supply Premier Biotech with the antigen tests within 14 days of receiving the $1.47 million down payment for the products.
The lawsuit says Bhatti assured Premier Biotech in January this year that the antigen tests had already been manufactured and awaiting shipment.
Premier Biotech claims that, unbeknown to it, the antigen tests had been neither manufactured nor shipped by Spring Healthcare.
The lawsuit says that Bhatti continued to delay, claiming that the “finished product” was only awaiting “export release” before being shipped to Premier Biotech.
Premier Biotech says it subsequently cancelled the contract over Bhatti’s failure to supply the antigen tests in time.
The company further claims that Spring Healthcare agreed to return the $1.47 million deposit Premier Biotech paid for the antigen tests.
Premier Biotech says Bhatti agreed to a repayment schedule and made the first agreed repayment of $25,000.
“Spring Healthcare failed to make every other agreed-to repayment and the current amount owed as repayment to Premier Biotech is $1,445,000.00,” the lawsuit says.
It further claims that Bhatti assured them the wire transfer for the return of the deposit transfer had been arranged. However, no such transfer was ever made.
Premier Biotech said if it had not been for Bhatti’s “misrepresentations” about the antigen tests already having been manufactured and shipped, it would have immediately cancelled the contract.
When contacted, Bhatti said Spring Healthcare “rejects the fabricated allegations of Premier Biotech as unfounded in fact and at law”.
He said the “defaulting party” in the contract is Premier Biotech, not Spring Healthcare.
Bhatti said Spring Healthcare has always honoured its obligations and responsibilities and has confidence that any proceedings will show the company acted in good faith.
“Spring Healthcare will, to the full extent that the law allows, defend itself and its reputation. We strongly urge you to not allow yourselves to be used as an instrument of unlawful extortion by publishing such defamatory and baseless allegations,” Bhatti said.
Two of Bhatti’s former business partners last year raised red flags about his activities.
Kamal Sharma and Tyrone Greenshields resigned as directors of Swiss-based company Accutor AG in 2019 after growing suspicious about Bhatti.
In the summer of 2019, the pair say concerned Accutor employees in Malta and elsewhere brought details about many large payments made into and out of Accutor AG between 2017 and 2019.
These transactions, they say, had not been recorded in the customer relationship management system and records were missing from the usual shared file folders that they accessed regularly.
Upon investigating the transactions, Sharma and Greenshields confronted Bhatti about the payments as well as two other Accutor officers, who were authorised to process transactions.
“They had no reasonable explanations for the concerning financial activities and it was clear that, in their minds, neither Tyrone nor I were supposed to know about these transactions,” the two former directors told Times of Malta.