Issue link: https://maltatoday.uberflip.com/i/1498223
ANYONE who has ever tried to buy or sell a property knows that, these days, there is a lot of red tape and bureaucracy involved when it comes to the actual transfer of funds. Because Malta has been tarnished by so many mon- ey-laundering scandals, filling out the Know Your Client form has become obligatory before the actual transaction takes place in order to divulge one's source of funds. If you have nothing to hide, this form is a mere formality, but it also means that ordinary citizens who have obtained their money in a way which is above board and completely transparent, are being made to feel like they are under a mi- croscope. The default position seems to be that you are automatically being viewed with suspicion, basically like a potential crim- inal, unless you can prove oth- erwise. Which is why when reading last Sunday's report about the unexplained wealth of Chris- tian Borg, the owner of No De- posit Cars Malta (who, among other things, is being charged with kidnapping and threaten- ing a man), the average read- er could not help but wonder how his transactions could go by unnoticed, without being flagged. Where was the due diligence and scrutiny when he bought properties such as a villa and a luxury penthouse with no pa- per trail to speak of? According to investigators, there were no bank loans nor was any money transferred from his account to explain the purchases valued at a couple of million Euros. In stark contrast, mere mor- tals are given the third degree and have to practically hand over a kidney to the bank in order to obtain a loan to buy a property. According to a report in the Times: "The residential prop- erties were all registered in Christian Borg's name over the course of seven years, between 2013 and 2020. Documents (notarial deeds and other pub- licly registered documents) seen by Times of Malta show how Borg financed most of the investments without a bank loan, paying for large parts of the properties in exotic cars such as a Ferrari 458 and a top- of-the-line Range Rover SUV." Granted, during the time pe- riod quoted above, the due dili- gence on those buying property was not as strict as it is today. In fact, a guidance paper issued by the FIAU for the property sector is dated February 2020 and was published in terms of the provisions of the money laundering and funding of ter- rorism regulations. This paper clearly spells out the risk factors of those carry- ing out transactions using large amounts of cash: "Cash is a popular means of payment in the criminal world: cash pay- ments are anonymous and do not leave a trace, allowing per- sons to disassociate themselves from financial transactions carried out in cash. Similarly, the cash used by the purchas- er may have been provided by an unknown third person and a subject person might not be able to detect this and, more- over, will not be able to iden- tify the third person and their potential links with suspicious activity." The paper also details in plain terms why divulging one's source of wealth is crucial: Us- ing one's own funds without taking out a loan poses the pos- sibility that a person is seeking to launder a large amount of il- licitly obtained funds through a one-time transaction. We all know why the screws were only tightened relatively recently, especially after Malta was put on the Financial Ac- tion Task Force Grey List in 2021. However, this still does not explain how no one batted an eyelid when a 19-year-old was able to start wheeling and dealing in cars at such a young age (170 cars were in his name while another 1,500 cars were registered under his various companies). If the business it- self did not raise any eyebrows, his lavish lifestyle should have, not to mention the deposits of large amounts of cash in ATMs all across the country. How is it possible that no one noticed anything? Vat fraud by Borg on a ma- jor scale, which has been hap- pening since 2016, was only brought to the attention of the Police by the tax department a year ago and is still under in- vestigation. But the lid should have been lifted on Borg's en- tire operation years ago: the 26 people who have taken him to Court have spoken about ille- gal clauses in their hire pur- chase contracts, being made to pay for defective cars and find- ing out that the car they had bought had outstanding con- traventions. The dots, when connected, point to close ties with the Labour Party and people in power, which is a depressingly familiar, recurrent theme we have now become used to since 2013. In 2018, Borg was being au- dited by the Tax Compliance Unit and just two months lat- er, the then Tax Commissioner HIMSELF Marvin Gaerty went on a trip to Las Vegas with Christian Borg to watch a fight. Just how many times can we re- sort to the same mantra of "you can't make this stuff up?" And even though Robert Ab- ela was not Prime Minister at the time, the fact that he and his wife entered into a property deal in 2018 with someone like Borg does not look good at all. What is worse is that Abela was providing legal advice to both the Planning Authority and Borg at the same time. All these circles within circles can be seen everywhere you look, with lawyer-politicians wearing too many hats, one minute representing shady cli- ents and the next pounding the rostrum, talking about justice and rule of law. Make up your mind, you can- not please both masters, and you certainly cannot keep giv- ing these mixed messages to an already jaded, already highly cynical public. More recently, in another separate case which has similar undertones, five business peo- ple were arrested over money laundering, fraud and tax and VAT evasion to the tune of some €62 million. The crimes were carried out between 2012 and this year. That's over ten years during which these people have been basically doing what they like, with everyone turning a blind eye and either accepting it or resigning themselves to the fact that "Malta has always been like this". Our senses have been blunt- ed to such an extent by the frequency of these stories, that not everyone is capable of grasping the real implications and consequences to their own lives, preferring to avert their eyes and saying, "it has nothing to do with me". When corruption becomes so rife that it is endemic to the culture there is also the probability that people stop caring or (more dangerously) they stop seeing anything in- trinsically wrong with it: with everyone ripping everyone off, it becomes the survival of the fittest, and more fool you if you don't join the club. Some say that the Labour Government still manages to hold sway over its voters be- cause it flashes a couple of hundred Euros in vouchers or announces some new freebie scheme and everything is for- given. It could very well be that that is likely the reason that the stench of corruption has never really made a dent on the core diehard voters who are the backbone of Labour's support - but let us not forget that Labour swept to power with a huge majority because many floating voters made the switch. It is this crucial segment of voters which will tilt the bal- ance and will determine what happens next. 6 maltatoday | SUNDAY • 30 APRIL 2023 OPINION When corruption becomes so rife that it is endemic to the culture there is also the probability that people stop caring or (more dangerously) they stop seeing anything intrinsically wrong with it: with everyone ripping everyone off, it becomes the survival of the fittest, and more fool you if you don't join the club Josanne Cassar Due diligence and scrutiny… but only if you're a nobody