Updated | Smart meters’ safety features ‘inexistent’, Grima denies misleading NAO

Updated with reaction from Peter Grima, Wednesday 11 June at 7:34pm

Enemalta’s former chief technical officer, Peter Grima, had mentioned several technical specifications as proof of the impossibility to tamper with smart meters, but the specifications simply did not exist, MaltaToday can confirm.

The mentioned specifications gave the National Audit Office a false sense of security when investigating claims of tampering with Enemalta’s smart meters way back in 2012. Based on the responses given by Enemalta Corporation and Grima, the NAO had concluded that the smart meter technology was robust and tamper-proof, only for the truth to come out in 2014.

Faced with media reports in 2012 claiming that it was possible to tamper with the smart meters, the Corporation had shot down the claims as “untrue” and “impossible”.

In one instance, Grima told audit investigators from the NAO that the meters had a built-in device that tripped automatically if someone attempted physical tampering. This technical specification now turns out to have been non-existent.

In a letter to MaltaToday sent by his legal representative, Grima denied that he had misinterpreted the facts to the NAO or in any way attempted to mislead the inquiry.

“All the replies given to the NAO in their 2012 questionnaire were based on information that was available to Enemalta and my client at the time,” Grima’s lawyer said.

But government sources insist that when interviewed by the audit office, Grima either deliberately lied or was fed incorrect information.

“In view that some of the information given to the NAO was based on very basic meter technology properties, one finds it hard to believe that he was fed wrong information. It is also inconceivable that the Chief Technical Officer would not be familiar with the basic properties of the meter technology being installed,” sources told this newspaper.

Grima denies latest report

On Wednesday evening, Grima once again categorically denied that he either lied or provided misleading or incorrect information to the NAO, or that the technical specifications described to the NAO were non-existent. "In particular, and unlike your unnamed sources, my client feels that rather than divulging confidential and potentially sensitive technical details of the meter anti-tampering protection to the media in response to these totally unfounded allegations, these should be discussed with the authorities concerned," Grima's lawyer told MaltaToday on Wednesday evening, in reaction to the report published earlier in the day in MaltaToday Midweek.

The smart meters used by Enemalta were procured from IBM and ENEL in 2009, equipped with security features and anti-tampering devices which were believed to make them difficult to tamper with.

“These numerous features were described in detail to the NAO by Grima and it was obviously underlined that these protection features were only operational once the meter was installed at the consumer’s end, and communicating with the central meter management system,” Grima’s lawyer said.

But informed sources told MaltaToday that no such issue was ‘obviously underlined’ since the way the information was provided to the NAO showed the protection was already functioning.

This may be confirmed by the NAO’s 2012 report on smart meters, which on page 19 refers to ‘built-in protection’ – ‘built-in’ implying a feature already in being in stand-alone mode, without needing the back-end connection.

Furthermore, in his letter Grima defends himself by saying that there was no attempt made to downplay the possibility of meter tampering, despite opting to shoot down detailed media allegations without conducting any investigations. 

Grima tries to shift responsibility by saying that he was responsible only for the Enemalta distribution section, including the meter section, until June 2012, after which, following an internal reorganisation, the responsibility was no longer held by him.

“After June 2012, Grima no longer held the responsibility to ensure the implementation of such an approach following the internal reorganisation,” Grima’s lawyer told MaltaToday.

However, MaltaToday is informed that the audit commenced while Grima was still CTO and it was he who supplied the technical response to the audit.

Timeline

In 2012, alarm bells rang at the finance ministry over allegations of the massive fraud taking place due to tampered smart meters. The Auditor General was tasked with a report into ARMS Ltd’s operations in 2012, as a follow-up to a report commissioned in 2011.

In April 2012, Labour Party e-paper MaltaStar.com, published a detailed article claiming tampering of smart meters meant that consumers were being billed 75% less than the actual amount owed.

Enemalta had obtained information about tampered meters in the summer of 2013, and by October it hit upon the first evidence that tampering had occurred.

The investigation was run jointly by Enemalta Corporation and the police, with the scam being finally revealed in 2014. Several Enemalta employees were fired in February 2014 in relation to this case.

By May 2014 it was clear that the NAO’s 2012 report, in which Enemalta’s technical superiors had discounted the possibility of tampered smart meters, had been extremely inaccurate and that the NAO had been misled.

The estimated theft ran into millions of euros, according to the energy ministry, although this has not yet been established. But the government claims the racket was organised within a formal framework that included professional middlemen.