OPM director Rita Schembri was in close contact with Casinò di Venezia buyers

Correspondence seen by MaltaToday has confirmed that Rita Schembri, the head of the Prime Minister's internal audit and investigations department (IAID), was a trusted colleague of the chairman of Far East Entertainment Group plc and intimately connected to the details of an investment proposal for a 40% stake in Birgu's Casinò di Venezia back in February 2012.

While the Office of the Prime Minister stated earlier this week that Schembri had denied offering any consultancy or advisory services to any private business - ostensibly without official approval - correspondence seen by this newspaper shows the IAID chief being on familiar terms with FEE chairman Colin Perkins.

A meeting Schembri set up in mid-February with a local contact of FEE to hammer out an investment proposal for the casino bid had to be cancelled after Schembri's daughter was taken ill.

A month later in March, Schembri informed both Colin Perkins and Nigel Songhurst of FEE that everything was back to normal: "I thank you for your moral support during the past few weeks... I am back working full-time from the office," Schembri tells the FEE directors.

Schembri also informs Perkins that she has been in touch with Casinò di Venezia chief executive Ferdinando Orlandi, whom she says had asked her to keep discussions on the 40% stake sale "to ourselves".

Additionally, she asks Perkins to "guide [her] re my role" on the talks with the casino owners.

The correspondence goes a long way in suggesting that Schembri, who was then IAID chief and today is also a permanent secretary inside the OPM, was involved in the provision of consultancy or advisory services to Far East Entertainment Group plc (FEE) as revealed by this newspaper on 4 November.

Schembri has official approval from the principal permanent secretary Godwin Grima to hold a non-executive directorship in Brait SE, a private investment holding company based in Luxembourg, but this directorship is understood to be unconnected to the services she has given to FEE in their bid to acquire a stake in the Casinò di Venezia.

Negotiations for the 40% stake in the casino saw Schembri discuss with Maltese lawyers acting on behalf of FEE Group, the investment proposal for Vittoriosa Gaming Ltd's chief executive Fernando Orlandi. Schembri also appears to have come on recommendation of FEE Group chairman Colin Perkins, to meet up with other local representatives to discuss the company's investment strategy.

Most questionable of all is a meeting she set up at Valletta Buildings in South Street, Valletta - which happens to be the same address of the IAID offices.

The OPM has not confirmed whether Schembri has denied setting up this meeting at the government office of the IAID, but only said it was informed that principal permanent secretary Godwin Grima had given his approval for the Brait directorship. The OPM said Schembri has denied any other consultancy services. The OPM also specified that Prime Minister Lawrence Gonzi "was not cognisant" of either the Brait directorship or any other consultancy services, which would otherwise require the approval of the principal permanent secretary.

Approval from Grima for the Brait directorship was issued on 12 April after he was informed in late January 2012 that Schembri had been invited to become non-executive director and that her input would entail only four meetings a year. She was appointed director of Brait on 30 March 2012.

As required by the public service management code, Schembri formally asked for permission to hold this private interest on 13 March 2012.

Grima also said Schembri assured him that this work could in no possible way impinge on her duties. "She felt that being involved in such a function in the private sector would serve her in good stead in her audit and risk assessment duties in the public sector... she gave a commitment that she would avail herself of vacation leave in order to attend board meetings, whether these are held in Malta or abroad."

The public service's management code allows public officers to engage in any form of business or employment outside their official duties, as long as there is no conflict of interest with their official activities.

Schembri was appointed permanent secretary in September 2012, while serving as director-general of the IAID. A member of the supervisory committee of the EU's anti-fraud office OLAF, having been aware of the OLAF investigation into former commissioner John Dalli as early as 4-5 July, she withdrew from the committee's examination of the Dalli case a day after the former commissioner's resignation.