Head of Malta investigation into Dalli case withdraws from OLAF supervisory role

The director-general of the Prime Minister's internal audit watchdog, Rita Schembri - who also heads the anti-fraud coordinating service (Afcos) that liaises with OLAF in Malta - has "withdrawn" from the work of the supervisory committee of OLAF, the EU's anti-fraud office, as it prepares to examine the way the Dalli investigation was handled.

The news was followed by a statement by German MEP Inge Graessle (EPP), who is a European Parliament rapporteur on OLAF, demanding to know why OLAF's supervisory committee chairman Christiaan Timmermans had resigned in the wake of the resignation of European Commissioner John Dalli at the hands of an OLAF investigation, whose report is so far unpublished.

"The OLAF Supervisory Committee must demonstrate that John Dalli's dossier was handled in full respect of the procedural and legal requirements of OLAF," Graessle said in a statement.

Rita Schembri, who is the director of the Internal Audit and Investigations Department inside the OPM, also heads Afcos, the unit which conducted part of the Dalli investigation in Malta.

Schembri is also a member of the five-man supervisory committee of OLAF which oversees that investigations carried out by the anti-fraud unit are done according to the established rules.

As head of Afcos, Schembri communicated information about the Dalli investigation as early as 5 July to the Office of the Prime Minister.

A statement by Johan Denolf, the president of the OLAF supervisory committee, confirmed that Schembri had withdrawn from any of the work of the supervisory committee on the 'Dalli' case on 17 October, a day after the investigation was referred to Malta's Attorney General.

"Schembri withdrew from any of the work of the Supervisory Committee which might refer to that case in order to avoid any potential conflict of interest due to the fact that the Maltese Internal Audit and Investigations Department (IAID), which falls under her portfolio as the Permanent Secretary, had assisted OLAF in a part of that investigation conducted in Malta, as required by the Administrative Cooperation Arrangement between the IAID and OLAF (a standard arrangement signed between OLAF and the respective authorities of the countries acceding the EU in 2004)," Denolf said in the statement.

"In accordance with its competences, the Supervisory Committee requested and obtained full access to the case file. The Supervisory Committee is currently examining the case."

Denolf became chairman of OLAF's supervisory committee on 22 October after the resignation of Christiaan Timmermans, whom he said had resigned for personal reasons but continues to be a member of the Supervisory Committee.

Earlier reports in the Frankfurter Allgemeine Zeitung claimed Timmermans had stepped down over the handling of the investigation into former EU commissioner John Dalli. Dalli resigned after Commission president Jose Barroso read him the covering letter of an OLAF investigation, which claims there is circumstantial evidence confirming he was aware of an attempt by a Maltese businessman to solicit a bribe from Swedish snus producers Swedish Match, in a bid to influence tobacco legislation.

The statement by OLAF was followed up by comments from German MEP Inge Graessle (EPP), who is a rapporteur on OLAF's operations: "The OLAF Supervisory Committee has to disclose the real reason for the resignation of its Chairman in the immediate aftermath of the resignation of Commissioner Dalli," Graessle said in a statement yesterday.

"In light of [the] statement by OLAF, the EPP Group Coordinator in the Budgetary Control Committee of the European Parliament, Inge Graessle MEP, has demanded full transparency on the reason for the resignation of the chairman of the OLAF Supervisory Committee, Christiaan Timmermans, in the wake of the resignation of European Commissioner John Dalli.

"In addition, the members of the OLAF Supervisory Committee must demonstrate that John Dalli's dossier was handled in full respect of the procedural and legal requirements of OLAF and the OLAF Supervisory Committee, and in full compliance with the rights accorded to persons under investigation by OLAF, also in the light of the court ruling in the Franchet/Byk case."