This is the fourth part of a series arising from an interview with an ex-staff member at the AUM. Part 1 is here.
John Ryder, Provost at the AUM, is, according to the ex-staff member interviewed, ‘making a shitload of money.’
A shitload of money was certainly invested in the AUM project which began to take shape in 2014, shortly after Muscat’s Partit Laburista came to power. In January that same year, Pilatus Bank was officially opened by the Prime Minister in Ta’ Xbiex. The vast majority of its clients happened to come from Azerbaijan – a country where Ryder had previously worked – and most were politically exposed companies or persons with links to the ruling Aliyev family.
Shitloads of money were spun through this bank, some of which made its way into the illegal offshore accounts of people and entities named in the recent CoE report. Keith Schembri, Adrian Hillman (the government’s representative on the AUM’s Trustee Board) as well as Egrant whose ‘mysterious’ owner remains sealed behind Karl Cini’s lips. Strange that he wasn’t requested, let alone legally required, to reveal the name as part of the inordinately expensive (thanks to us taxpayers) and still unpublished Magisterial Inquiry.
By chance, 2014 was also the year when Muscat, Schembri, Mizzi and Farrugia made their way to Baku (the same city where Ryder worked) for that secret meeting with President Aliyev.
In the same year, too, Muscat’s government signed a secret memorandum of understanding with Vitals Global Healthcare, 5 months before Projects Malta put out a public call for proposals of interest for the running of 3 hospitals. Shitloads of money were involved when Vitals (also mentioned in the CoE report) received a 2 billion euro concession to run Karen Grech, St Luke’s and Gozo hospitals for 30 years, paying 1 euro for all their contents.
Shitloads of money got reduced to 1 euro, the price paid by Steward Healthcare for all the shares in Vitals as well as the concession worth 70 million euro per year for the 3 hospitals. At the same time, millions were transferred to hidden investors while Vitals was busy negotiating international deals with other governments just as they had in Malta.
The NGO Repubblika instigated a request for a criminal inquiry into the possible complicity of the Finance Minister, Edward Scicluna, Mizzi (again), Cardona (again) and Ivan Vassallo in the VGH deal. As if on cue, Ram Tumuluri, one of the owners of Vitals, decided to place nine of the previously hidden Jersey companies involved in VGH into liquidation, companies which seem to have been set up for the purpose of extracting ‘commissions’ from the companies holding the healthcare concession in Malta.
In the recent CoE report, similarities are cited between the Vitals deal and Electrogas (Point 43). Ongoing and extensive investigations conducted by The Shift News show vast amounts of money being sloshed around in the various shady deals struck between Malta Government, Vitals, Steward, Technoline, Mtrace plc, and taxpayer’s money at that. The sums involved make the stated original investment of over 115 million euro in the AUM project look somewhat paltry in comparison. Incidentally, the reference used here comes from the AUM Wikipedia page, not the government’s official website, as the original ‘source you are looking for does not exist.’
Back to the land of smoke, mirrors and that eerily empty Mary Celeste.
Money Laundering, Lawyers and Accountants
Shitloads of money that disappears before your eyes conjure up that magical act known as money-laundering, something for which Malta is now infamous. Scrutinised and held to account by the European Parliament, the European Commission, the European Central Bank, MoneyVal, Greco, the Venice Commission and now the damning CoE Report, Malta has been officially designated as having all the characteristics of a tax haven. Even before this was declared last March, a report from Malta’s own National Statistics Office last year showed tax evasion is rife.
While tax evasion and money laundering are not the same thing, a tax haven is the most common place to hide and/or launder money, an activity which is in itself an evasion of tax. Those who engage in such activities rarely work alone, they necessarily operate in secrecy, and they infiltrate otherwise legitimate areas of business such as law.
There are a lot of lawyers in Malta, Pawlu Lia being one example. Muscat’s personal lawyer in the Egrant inquiry, the main legal counsel for the Labour Party, he was also appointed by Muscat to sit on the Commission for the Administration of Justice. http://www.independent.com.mt/articles/2019-03-10/local-news/Pawlu-Lia-s-multiple-roles-Chamber-of-Advocates-President-sees-no-conflict-of-interest-6736204792
Lia’s daughter in law, Nadine, faced misconduct proceedings over ‘shameful’ and ‘appalling’ altercations in court in 2010 https://www.timesofmalta.com/articles/view/20190414/local/soon-to-be-magistrate-had-faced-the-justice-commission.707262. Nevertheless, she was apparently deemed fit to continue her legal career following a hearing in front of the same Commission for the Administration of Justice on which her father sits and which operates in secrecy. She became one of the three newly appointed magistrates rushed along for a swearing-in ceremony minutes after the NGO Repubblika filed a court application to prevent the further appointment of any judiciary prior to the implementation of the Venice Commission recommendations. https://www.tvm.com.mt/en/news/three-new-judges-and-magistrates-sworn-in/
It’s important to remember that Aaron Bugeja, the magistrate leading the Egrant inquiry, was also promoted to judge at this same ceremony.
Perhaps we should note that Nadine Lia was legal advisor to the Economy Minister, Chris Cardona, who signed a heads of agreement at Castille with Hani Salah for the setting up of the AUM on 5th May 2015 http://www.independent.com.mt/articles/2015-05-05/local-news/Government-signs-heads-of-agreement-with-American-University-6736134942. This occurred over a year before the AUM was granted university status and seven months before the government transferred large swathes of public land to Sadeen Education Investments Ltd (otherwise known as Hani Salah) following an all-night parliamentary debate.
Clad in his academic gown, Chris Cardona was a proud guest where guests outnumbered students at the recent inauguration of the AUM on March 8th 2016. This coincided with International Women’s Day as remarked upon in the opening speech by the President of the AUM, ‘distinguished American academic leader’ Dr Lewis Walker. Indeed, he opens his speech with words from Malala Yousafzai: ‘Extremists have shown what frightens them most: a girl with a book.’ Antithetical to any form of feminism, he requests flowers be accepted ‘that we will distribute to the women.’
And what harm is there in a little patronising sexism when the AUM isn’t known for being overrun with books unless you count its eerily empty but ‘mostly digital library’?
Leaving aside the damning draft report by the Council of Europe in which judicial independence and the rule of law are jeopardised by the Prime Minister’s unfettered discretion to appoint judges and magistrates, leaving aside its indictment of magisterial inquiries as a means of investigating criminal offences, leaving aside its criticism of the FIAU and the Permanent Commission Against Corruption, and leaving aside its observation ‘that individuals such as Dr Mizzi, Mr Schembri and Mr Tonna seem to enjoy impunity, under the personal protection of Prime Minister Muscat’, let’s remind ourselves that money laundering infiltrates otherwise legitimate business operators such as accountants and financial advisors.
Working for the accountancy and advisory firm Nexia BT where the aforementioned Karl Cini also works, Brian Tonna’s name is singled out for attention in the CoE report. Chris Cardona who signed the original deal with the AUM is mentioned in it, too. Brian Tonna is the Prime Minister’s accountant. Both Tonna and Cini set up accounts for Schembri, Mizzi and whoever owns Egrant using the now defunct Mossack Fonseca in order to disguise their tracks.
None of this is secret any more. It is now public knowledge just as we know that 17 Black, a target company for Schembri’s Tillgate and Mizzi’s Hearnville, is owned by Yorgen Fenech, chairman and part-owner of Electrogas along with SOCAR. Shortly before Partit Laburista came to power, Mizzi, then Labour spokesperson for energy, spoke of his ‘roadmap’. Soon after Labour’s election victory, a call for expressions of interest in the power station project was issued by Enemalta, bypassing the Department of Contracts. Tonna was swiftly appointed to Enemalta’s selection committee.
Along with Brian Tonna and Chris Cardona, Adrian Hillman is also personally named in the draft CoE Report for his alleged money laundering ventures with Schembri in which Tonna and Nexia BT played a key role.
Last August, Hillman claimed the Panama Papers inquiry was making his life ‘difficult’ when he filed an appeal with Malcolm Scerri, his business partner, and Schembri against the recusal of Judge Mizzi despite conflicts of interests from his marriage to a Labour MEP. Hillman claimed his rights were being violated because he ‘found himself embroiled in a morass of allegations which principally arise from partisan politics in which he is not involved in any way.’
Yet last October, Hillman was revealed to be earning 4,000 euro a month as PR man at the Malta Gaming Authority which falls under the political responsibility of the OPM.
Despite money laundering investigations, Hillman was appointed to the Board of Trustees at the AUM in 2017 and, as announced at its Inauguration last March, he actually serves as the Malta Government representative.
According to the ex-AUM staff member, Hillman took an office there in November or December 2017:
‘He’s basically their public relations guy…It was right about the time of that huge negative publicity and he was brought in to save them, save the appearance of the university, and they had other consultants coming and going. They were bringing press in…giving them tours and telling them…positive things.’
Although speculating, the ex-AUM staff member has the first-hand experience of working at the AUM and so is privy to insider knowledge, in this case, knowledge that came from the Provost himself. Referring to Khazar University and Ryder’s claims that there were two sets of financial books, he says:
‘I wouldn’t be surprised if they were using the university as a front for money laundering…The financials, the books, weren’t real as they were presented to international bodies and to keep it accountable, accreditors would want to see the books and they never showed the real financials for the university. I wouldn’t be surprised if the same thing was going on at AUM and John is game for it…He doesn’t have any scruples. He’s not an ethical person at all.’
Ethical issues are integral to working (or not) in countries engaging in known violations of human rights, such as Azerbaijan and the UAE. Ethical issues are integral to definitions of legal and illicit. And ethical issues are integral to Ryder’s specialist area of expertise: philosophy.