Issue link: https://maltatoday.uberflip.com/i/661117
maltatoday, SUNDAY, 3 APRIL 2016 News 11 Finance ministry insists 'defrauded' man should repay taxman JURGEN BALZAN THE tax department could soon provide people the option to pay their bills directly without involving a notary in the transfer of money, the finance ministry has said. Reacting to the MaltaToday report on a man who claims to have been defrauded by a notary whom he entrusted with paying his deceased brother's succession tax, the min- istry said the Inland Revenue Department (IRD) is looking into the possibility of allow- ing customers to make duty and tax payments directly themselves. Despite providing evidence to the IRD and filing a police report that the money he gave to his notary, Philip Said, to pay the succes- sion tax was used to pay somebody else's tax, Albert Mamo has not been given the money back and the tax department insists that he should make the payment anew. The finance ministry told MaltaToday that "any allegations for the payment of damages incurred by the client should be directed by the client against the notary and not against the government," adding that any damages incurred by the client "have to be borne solely by the notary." Mamo has raised the issue with Prime Min- ister Joseph Muscat, finance minister Edward Scicluna and justice minister Owen Bonnici. However, while everybody acknowledges that Mamo has been defrauded, the finance min- istry said "the amounts are still due to the gov- ernment and from the government's point of view, it is up to the client to pay such amounts and then to claim such amounts from the no- tary." The ministry argued that a notary has a dual function, a public official who at the same time acts as an independent and free profes- sional. These functions and responsibilities are separate but a notary must safeguard both the public and private interests, the ministry added. In reaction, Mamo told MaltaToday "a no- tary is a public official who acts on behalf of the government and therefore the govern- ment should assume responsibility for what- ever a public officer does." Mamo was told by finance minister Ed- ward Scicluna 'Albert, it seems you have been robbed on the way to pay the IRD. We are prosecuting the robber for fraud. You have to get the money from the fraudster by a civil case. In the meantime you owe the IRD mon- ey. These are the facts. If there was a legal way to get you the money back, we would. There isn't.' "However," Mamo told MaltaToday, "the IRD commissioner, Marvin Gearty, told me that I should be rightfully given my money back, but this he said would create a prec- edent and the department did not want to go there." Mamo is adamant that he will not make a new payment before the "stolen" money is re- turned to him, especially since "this was not a mistake done in good faith." The notary involved, Philip Said, has faced multiple charges of misappropriation, and the finance ministry has confirmed that "we had reported Notary Said on other cases." Following Mamo's complaints in 2014, the head of the Capital Transfer Duty Depart- ment, Patrick Grima, wrote to former inspec- tor Daniel Zammit, son of the former acting police commissioner Ray Zammit, who at the time was a member of the Police's fraud squad. Daniel Zammit was himself embroiled in controversy last year, when the Attorney General said he was "unethical" in his role as co-prosecutor in the murder charges against Stephen Caruana, the son-in-law of Joe Gaf- farena, with whom Zammit and his family are in business. Zammit was controversially medically 'boarded out' of the police corps in May 2015. Moreover, the ministry added, notaries who fail to pay duty or are in breach of the Duty on Documents and Transfers Act, are liable to a penalty of between €11 and €465. Mamo had used the services of his long- time friend, Said, to pay the succession tax or causa mortis on the property inherited by his deceased brother and gave the notary a bank draft for €4,195, payable to the Commissioner of Inland Revenue. After seeing that the monies had been with- drawn from his bank account but the deed had not been registered, Mamo paid a visit to the department's offices in Valletta and was shocked to discover that Said had used the bank draft to pay a stranger's withholding tax bill. After presenting all the evidence that his bank draft had been cashed by the Commis- sioner, the IRD's cash office in Floriana issued a new receipt after replacing the stranger's details with Mamo's. The finance ministry argues, however, that the fact that an IRD of- ficial manually changes the receipt and later reverses the decision, does not entitle or give the client any legal basis to claim any damages from the government. Said's daughter, Jessica, offered to register the deed but she was stopped from doing so by the head of department, Patrick Grima. In a meeting with Grima, Mamo was told that despite the money being cashed by the IRD to pay somebody else's tax, the depart- ment would not be returning the money or transfer the payment to cover his brother's succession tax. Mamo has reported the matter to the police and legal action is under way. Said still appears on the notarial council's official online list of enrolled professionals and the council has so far failed to answer questions on whether any action was taken against the notary. Clients could be offered option of paying tax bills directly without involving a notary, finance ministry says Minister claims 'PN loans' artfully bypass party financing rules MAT THEW AGIUS JUSTICE minister Owen Bonnici has attacked the PN's recently-announced 'Cedoli' fundraising scheme, saying the loans scheme raises more questions than it answers. In a press conference with lands par- liamentary secretary Deborah Schembri, Bonnici said the PN's system of €10,000 loans raised "serious suspicions" that these had been designed to evade the con- trols introduced by the new party financ- ing law, which caps donations from indi- vidual sources. "Best practice dictates that a public con- tract is necessary to regulate loans of over five years, but this scheme is anything but transparent. Does the PN want to evade this by hiding the identities of its benefac- tors?" asked Bonnici. "Is this transpar- ency? Is the party ready to tell people that they are safe in making loans by private writing?" The minister claimed the PN's loan scheme, which will pay a 4% interest on a 10-year loan period, was a coordinated ef- fort to get around the new restrictions. "It was clear that the PN sat down and ana- lysed the party financing law with a view to circumventing it." Schembri said the loans scheme was an opaque and precarious system of financ- ing that kept donors secret. "The PN is not being truthful with the public and those who may be prepared to help fi- nance them. Here we have a party saying that its first contract, as an Opposition, is a secret one. It is trying to deceive the people." Schembri said the loans system provid- ed an opportunity for illegality since the amount being loaned already exceeded the maximum specified under party financing laws. "What if the loan is not repaid? Will we know who these people are?" Asked whether opening an offshore ac- count in Panama would give rise to suspi- cion, Schembri said that it was not a ques- tion pertinent to party financing. "The PN is using transparency as its battle-cry. The law is written, but there is also the spirit of the law, which is being breached in a rampant manner," Schem- bri said. The two speakers laughed off questions as to why energy minister Konrad Mizzi, embroiled in the Panamagate scandal on an offshore company he opened, had been absent from the public eye for the past month. "Mizzi was present at a public event on the 31 March," Bonnici said. 'A coordinated effort to get around the new restrictions'