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Christian Borg of the No Deposit Cars scandal, his girlfriend Monique Mizzi and the company’s directors Joe Camenzuli has been formally charged, Multiple companiesdefrauding “millions” in VAT and other taxes.
Also charged along with them are Princess Construction Ltd, Princess Holdings Ltd, Princess Operations Ltd, Zing Rental Ltd, No Deposit Cars Ltd and Lion Funding Ltd.
Borg, 31, and Mizzi, 26, appeared in court with attorneys Stephen Tonna Lowell, Albert Zerafa and Ana Thomas. Also in court was Joe Camenzuli, who represents the companies.
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Police officers Tonjoe Farrugia and Robert Azzopardi, assisted by prosecutors Francesco Refalo, Rebekah Spiteri and Mauro Abela of the Attorney General’s Office, charged the defendants with money laundering and criminal conspiracy. Borg and the companies were also charged with defrauding the tax commissioners, obtaining benefits by fraudulent means prejudicial to the interests of the Maltese government, false accounting and other fraud-related offences.
Police officer Tonjoe Farrugia explained that the charges were laid following an investigation into VAT fraud and tax evasion by Borg, not only in his personal capacity but also in the capacity of various companies in which he was a director or shareholder.
He said the VAT department first asked the police to investigate because there were “indications that Borg had issued false invoices for hundreds of thousands of euros” that were classed as expenses and for which he received VAT refunds.
The inspector added that there was also an element of money laundering involved.
When cross-examined by Tonna Lowell, Inspector Farrugia confirmed that the District Court investigation had concluded and a warrant had been issued for his arrest.
The lawyer questioned the information on which the arrests were based, pointing out discrepancies in the amounts recorded by auditors.
Inspector Farrugia clarified that the discrepancies were only in the financial records for one of the years under review, but the audit covered much more than that.
The inspector confirmed that the investigation is still ongoing, which led Tona Lowell to ask, “Why was the defendant arraigned today when the case could have been resolved administratively?”
“How can financial crime be solved administratively?” the inspector replied. “Our investigation concluded that the VAT department had defrauded millions of dollars.”
Officer Farrugia insisted that if there were any problems, only some of them could be resolved administratively.
The defense attorney suggested that “there are other multi-million euro frauds out there, but this person just happens to be called Christian Borg.”
The prosecution requested the freezing of all the defendant’s assets on the charge of money laundering and said it would submit the specific amount to be frozen within 90 days.
Toner Lowell acknowledged that once prosecutors requested a freezing order, the court was helpless, but said negotiations had been ongoing for some time. Now that a freezing order will be issued on all assets for at least 90 days, “everything is going to be a mess.”
The measure would also overlap with similar court orders already in place in other proceedings, lawyers noted.
The defendant pleaded not guilty to the charges and requested bail, but the prosecution opposed it.
“This investigation has been going on for several years. It didn’t just start yesterday,” Refalo said. Evidence the court will eventually hear will include “testimony from a number of civilians who assisted Mr. Borg in committing these crimes,” prosecutors said, warning that evidence could be lost if witnesses were contacted.
The prosecutor added that not all civilian witnesses testified during the investigation. “This case is VAT fraud, the defendant issued multiple receipts, but the defendant should not have claimed VAT.”
“We are not opposed to unprovoked bail,” Refalo added. “It is important to protect the proceedings.”
Tona Lowell asked whether those named as assisting Borg would also face charges or be pardoned, noting that otherwise they would be barred from testifying.
“When we say assisted, we mean they did it without knowing it,” the prosecutor clarified.
Defense attorneys argued that Borg and Mizzi must have known they were under investigation for “months and possibly years,” and told the court that Borg had been on bail at the time and had “never violated his bail conditions.”
“Boger and Mitzi had ample time to tamper with evidence, but they did not do so. The prosecution’s objection was that the fear was a phantom on paper,” the lawyer said, adding that Mitzi also has a young son and has never been in legal trouble before.
After adjourning to consider the bail plea, the court returned to the bench and upheld the bail plea considering the evidence already preserved in the investigation.
Miz’s bail consists of a €15,000 deposit and a €40,000 personal guarantee, while Borg was required to deposit €35,000 and provide a €60,000 personal guarantee as bail security.
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