Issue link: https://maltatoday.uberflip.com/i/598356
maltatoday, SUNDAY, 8 NOVEMBER 2015 6 CONTINUED FROM PAGE 1 The new emails show that George Farru- gia organised trips for a key of- ficial at the Malta Transport Au- thority to visit Austria to discuss traffic lighting systems. The Austrian company, Swar- co, which Farrugia represented, was later to win lucrative ten- ders for lighting systems along kilometres of roads in Malta and Gozo. This is revealed today by Mal- taToday, supported by a number of emails that are in the posses- sion of this newspaper. It all started with the setting up by George Farrugia of a new company known as ATMS Com- pany Limited. The company was struck off in 2012 after it was discovered that Farrugia had been defrauding his brothers – of family firm John's Group – by siphoning off the profits on the sale of fuel oil from subsidiary firm Powerplan, to his personal company Aikon Limited. ATMS was set up in 2007 after George Farrugia made contact with an Austrian company for the provision of traffic signs and lighting. It appears that the Aus- trian company had already made some sales to ADT. The contact from transport authority ADT (Awtorità Dwar it-Trasport) who worked with George Farrugia was Kenneth Spiteri, a senior official. The emails in fact show that Spiteri kept Farrugia informed of most tendering pre-developments at ADT. Emails sent from Spiteri's Gmail account and work account to George Farrugia included spe- cific details of upcoming tenders or projects. Farrugia would also be kept in the loop with emails sent to foreign suppliers. The emails expose the lack of respect for tendering procedures between the regulator, and com- mercial suppliers. Spiteri also seems to have been the adjudicator in many tenders: in one email written to a certain Morten Sondergaard of the Aus- trian lighting company Swarco, Spiteri informs him: "PS., the other cheaper option was 14,415 euro with VAT and freight in- cluded please try not to exceed it because then I need choose the cheaper option. Thanks Ken- neth." The email was dated 8 Janu- ary, 2008, sent two months after George Farrugia set up the com- pany ATMS. Apart from knowing Kenneth Spiteri, Farrugia also was very well acquainted with Ray Sta- frace, who was not only the chief financial officer at Transport Malta but also the accountant who offered his office address for Farrugia's Aikon Limited, the secret company he used to transfer the money made off Powerplan's sales of fuel oil, and into his Swiss bank account. Today Ray Stafrace, a Certified Public Accountant, holds the post of director of procurement at Transport Malta. In the investigations that kicked off fol- lowing MaltaToday's reports into bribery at Enemalta in January 2013, the police only skimmed over Sta- frace's involvement, simply noting that he had once served as ac- countant at the Medi- terranean Offshore Bunkering Company Ltd (MOBC) – where Frank Sammut was ex- ecutive director. It was an invoice for the payment of a kick- b a c k from Trafigura to Sammut that blew wide open the scale of cor- ruption inside Enemalta. Farrugia, who has admitted to the kickbacks that were for- warded to the petrochemist Frank Sammut, maintained an extensive network of contacts inside government regulators. Among these were Malta Re- sources Authority official God- win Sant, who has also been arraigned in court by police for having received gifts from Far- rugia. Farrugia was involved in the construction of petrol stations and Sant now faces criminal charges for allegedly aiding George Farrugia by providing him with crucial information on petrol pump tenders. The latest revelations point to more potential insider informa- tion being passed on to Farrugia but never disclosed by the busi- nessman when he was obliged to reveal all as a condition for his presidential pardon in 2013 – a pardon awarded days after MaltaToday broke the story of Frank Sammut's kickback from Trafigura. News Revealed: Farrugia's insider knowledge at Transport Malta post of director of procurement It was an invoice for the payment of a kick- b a c k Email sent from Swarco to George Farrigia asking for details on bidders Email sent by Kenneth Spiteri to George Farrugia from his Hotmail account about a tender on Pelican Crossing Controllers Email from Kenneth Spiteri to George Farrugia about his flight to Austria Simon Busuttil replies on Shell settlement statements THIS right of reply is accorded to PN leader Simon Bu- suttil in reference to the claims made by Saviour Balzan in the Public Accounts Committee in his regard. "My name was dropped in his testimony in order to associate it with the fuel procurement deals which are the subject of the PAC inquiry. Nothing could be fur- ther from the truth. "The facts are the following: 1. The fact that I was legal counsel for Shell's agents in Malta from 2004 until I won their claim in 2011 was always in the public domain. Throughout these years I publicly represented my clients in a seven- year-long legal battle during which recourse was made to the MRA, the MRA Appeals Board, the Court of Appeal, the European Commission and the Office of Fair Competition, where my legal ar- guments were upheld. It is because these legal argu- ments were won that a claim for damages arose. 2. I did not represent the clients in the legal proceed- ings for damages that followed in court, still less was I involved in the out-of-court settlement. This too can be established from the legal acts. 3. The case was heading to the European Court of Justice because of the absence of competition in the aviation-fuel sector in Malta, were it not for the case that I pursued. 4. The Shell case concerned access to the aviation fuel market at the airport and was not connected in any manner whatsoever with the fuel procurement that is the subject of the PAC inquiry. The impression bandied about that the two are connected is there- fore completely false and pure spin intended to link my name with something in which I was never, even remotely, involved." Saviour Balzan replies In the PAC I made reference to the fact that just weeks before MaltaToday broke the Enemalta oil scandal, the Nationalist Cabinet of ministers in 2013 was very much aware of problems with fuel procurement and access to the fuel market. The reason for this was a decision to award a tax- free €5 million settlement to the Maltese represent- atives of the Shell group in Malta, after the Malta Resources Authority concluded that the group had been barred from accessing the aviation fuel mar- ket in Malta. The European Commission had decided to refer Malta to the European Court of Justice (ECJ) for allegedly breaching EU rules about fuel ground handling services at Malta International Airport. Aviation fuel was supplied by Enemalta which also owns storage facilities. Following the liberalisation of the market, Shell had also tried to start distribut- ing fuel but it claimed that Enemalta was prevent- ing it through uncompetitive measures to carry on with its business. I told the PAC that the administration knew that something was amiss in fuel procurement, so MaltaToday's story should not have been met with much amazement. The Cabinet accepted the MRA's reasoning that Shell did not get a fair deal. Certainly there was a feeling in the government that something was wrong. Not to forget that al- though parliament had been dissolved on 7 January 2013, the Cabinet had decided to go ahead with a tax free payout of €5 million on 15 January. The payout underlined the serious problems with fuel procurement at Enemalta.