PN insists Falzon had 'early knowledge of Old Mint scandal'

The Nationalist Party today insisted that parliamentary secretary responsible for planning Michael Falzon had known early on about the government's controversial plans to expropriate half a property in Old Mint Street, Valletta, from Mark Gaffarena.

"Falzon has told MaltaToday that he had gone on a hunting holiday with with Mark Gaffarena back in 2003, when he was already PL deputy leader," shadow justice minister Jason Azzopardi told a press conference.

"Falzon and Gaffarena are closely acquainted and Gaffarena had told Falzon what he had wanted in exchange for the Old Mint property. Instead of telling him that there was no public purpose behind expropriating it and that doing so would be a waste of money, he referred him to the Lands Department.

"At Lands, Gaffarena was accompanied by Clint Scerri, a member of Falzon's secretariat. Falzon then personally signed two expropriation deals for the two quarters that were registered as a building site, shooting their value up."

He insisted that both Falzon and Prime Minister Joseph Muscat must shoulder political responsibility.

Azzopardi also had harsh words for the police, who had told MaltaToday that they haven’t started investigating the case as they haven’t yet received a report to do so.

"This is scandalous and absurd," Azzopardi said. "The police are legally obliged to investigate suspicious cases, even if they haven’t received a report."   

In January this year, the government paid Gaffarena €822,500 for a quarter of the property that he had bought in December 2007. A month later, Gaffarena bought another quarter of the property for €139,762, which the government subsequently expropriated for another €822,500 in April.

The money was paid in cash and lands that were of strategic and commercial importance to Gaffarena- land parcels at White Rocks, Ta’ Kandja, Handaq, Zebbug, and a property in Triq Manwel Dimech, Sliema.

The building at the centre of controversy houses the government offices of the Building Industry Consultative Council, and Falzon has said that the government had to expropriate at least part of it to avoid eviction by 2028.

However, Azzopardi insisted that governments should only expropriate land if it is in the public interest. In this case, he argued that the BICC offices could easily have been housed elsewhere.

“Governments rarely grant lands as compensation for expropriation and when they do it’s usually for large pieces of land,” he said. “Even here, the government has the legal right to choose which lands it wants to give out as part of the deal, and to choose those lands that make most sense to it.”

‘Granting of land was careless, reckless and abusive’

One of the properties granted to Gaffarena as part of the compensation deal was a shop at Manwel Dimech Street, Sliema, underlying a townhouse that he had bought two years earlier. Gaffarena has since applied with MEPA to demolish both townhouse and shop for the construction of five garages, ten apartments and a penthouse.

The Government Property Division Department had valued the shop at just €65,000 because it was not a freehold property and still under a temporary emphyteusis that is due to expire in 2016.

“This means that its value will shoot up next year,” Azzopardi explained. “Who in their right mind would sell a property whose value they know will increase in a year’s time? Granting the shop as part of the compensation was careless, reckless and abusive.”

The Times of Malta today reported that GPD architects had started assessing land at Bahar ic-Caghaq that Gaffarena would receive as compensation for the second expropriation while it was still on a promise-of-sale agreement.

Gaffarena actually purchased the second quarter ten days later on February 26.

The architects’ assessment of the Bahar ic-Caghaq land was dated February 16, only three days after Gaffarena had offered to sell the second quarter of the Old Mint Street building to the government.

“This is further proof that Gaffarena had inside information,” Opposition MP Ryan Callus said. “Everything fit in place for him too perfectly for it all to simply be a coincidence, and the whole thing stinks of corruption.

“It wasn’t a mistake either, but pre-meditated and intentional.”