Mabel Strickland’s heir says Allied Group must recover millions lost to graft

The ‘sole heir’ of Mabel Strickland, her nephew Robert Hornyold-Strickland, has reacted to the scandal related to the arrest of the former prime minister’s chief of staff Keith Schembri in connection with bribes given to the management of Allied Newpapers and Progress Press, publishers of The Times of Malta, saying he was seeking legal advice on how to recover the millions mentioned by police investigators in deals related to printing machines the company purchased.

As a 13% shareholder in the company, he said he has not been given access to the internal investigation on former Allied Newspapers Managing Director Adrian Hillman. “We, as minority shareholders, have never been allowed to see the internal Adrian Hillman report although we were expected (indirectly) to pay for it. This is a scandal.”

The nephew of the founder of Allied Newspapers said that if the allegations are proven, then all those who sat on the board of Allied Newspapers and Progress Press at the time these decisions were taken should be tendering their resignations, as should the Council of the Strickland Foundation “who elected Mr Hillman in the first place”.

“Seen from outside, as a mere minority shareholder in Allied at the moment, the method by which directors are chosen and the purchase of the printing machinery are merely two of a number of issues that I had raised questions about.  I have also questioned the financial probity of some past directors of Allied and members of the seemingly arcane Strickland Foundation that controls the newspaper group,” Strickland said in a statement.

Saying he was “disgusted and angry” that Allied’s workers and editorial staff have been so betrayed and now having to work under such stress as a result of these allegations, he said he believed The Times would “survive this scandal”.

Strickland has been in conflict with the organisation for a number of years. “What people will not know, is that following my Aunt Mabel’s death in 1988, Allied Newspapers fell under the effective control of her two executors Guido De Marco and Prof Joseph Ganado for 22 years, until their own deaths in 2010 and 2016 respectively.   These two executors’ self-serving interpretation of my aunt’s will is now well documented in the court case I filed in January 2010 and is currently under appeal.”

The Shift followed the last hearing on the case in November. The company secretary of Allied Newspapers, Clinton Calleja, was asked to explain why it took 22 years after Mabel Strickland’s death to have the transfer of shares registered. He failed to provide a clear answer.

Calleja told the court the Board of the company decided to proceed with the transfer of shares following a letter dated in 2010 by De Marco and Ganado saying that he “can proceed with the recording of the shares”.

The letter, seen by The Shift, also refers to the filing of a Form T which, according to Robert Strickland, does not constitute an instrument of transfer.

Mabel Strickland’s nephew is arguing that when the transfer took place, Maltese company law did not allow The Strickland Foundation to be a shareholder of Allied Newspapers Ltd because it is a “body corporate” and thus registered with its own legal identity.

By law, and also according to Allied Newspapers’ articles of association, a body corporate is not permitted to be a shareholder of the private exempt company.

According to the heir’s website, an amendment in Maltese law was enacted in 2013, “disguised as a budgetary amendment” by the outgoing Nationalist administration.

During the previous testimony in court by the former Managing Director of Allied Newspapers Vince Buhagiar, now among those facing a number of charges related to financial crimes, it emerged that a new registry book started being used after the transfer was made. This had surprised Judge Francesco Depasquale.

“You did not feel it had any historical or sentimental value at least?” the Judge asked. He got no reply.

Strickland’s nephew has criticised the lack of coverage in The Times of Malta on the issue, despite the fact that this is a matter of public interest involving Malta’s largest newspaper. He insists this is denying the public knowledge of the actual facts.

In his statement yesterday, Robert Strickland said that two weeks after he filed his court case against the executors, they “hurriedly transferred” the controlling 78% shareholding in Allied to the Strickland Foundation. “Until this time the executors held these shares in their personal names (on behalf of Mabel’s estate) for an astonishing 22 years.  This situation, of course, gave them de facto control of the Strickland Foundation and thus indirectly of the newspaper group because dividends from Allied represented the main source of income to the Strickland Foundation.”

Just before making this “highly irregular” 2010 transfer, the executors elected themselves onto the Board of Allied and saw elected their own two sons onto the Council of the Strickland Foundation, Strickland added, saying itt was illegal because the Strickland Foundation (as a registered body corporate) cannot be a shareholder since Allied is a private exempt company which only allows private individuals to be shareholders.

The shares were supposedly transferred by the company secretary (a De Marco employee) even without a valid instrument of transfer as noted by the Court.  “This transfer is not valid, and resulted in my second court case challenging this transfer”.

Strickland insists his aunt set up the Strickland Foundation “for herself and her heirs in perpetuity”. Yet those who took over refused to allow him to participate in the management of the newspaper group or in the Strickland Foundation ever since she died.

“Clearly, the irregular 2010 transfer gave the two executors (and now their sons and friends) real control over not just the Strickland Foundation, but also indirectly the newspaper group. There has been no Strickland on the Strickland Foundation since my aunt died in 1988 (33 years ago) let alone me (her carefully chosen heir).  My aunt would be rolling in her grave,” her nephew said.

The Strickland Foundation still managed to obtain several million euros in dividends from Allied before 2010 even though it was not and never could be a shareholder, Strickland said.  Allied Newspapers also owns 99% of Progress Press.

“Ever since my Aunt Mabel’s death, the majority of the directors and thus senior editorial staff at Allied Newspapers have been, directly or indirectly, chosen by the late executors and now the Strickland Foundation which is, I believe, arcane and unaccountable.   Their choices of personnel and decisions have now led to this sorry state of affairs.”

He said every attempt he has made to be elected onto the Board of Allied or the Council of the Strickland Foundation was blocked by either her two original executors or, after 2010, by the Strickland Foundation.

“People who my aunt placed into positions of trust have competed with me and blatantly disrespected Mabel’s sole heir. This is even more ironic since, before I became a Maltese national in 2013, I was trained as a forensic accountant in the UK.  Perhaps this was the main reason why I have been blocked by the Council of the Strickland Foundation whose vote decides all Allied board appointments.”

Reacting to the statement, the Strickland Foundation said it was “saddened” by the facts emerging in court related to the alleged involvement of ex-senior officials of Allied and Progress in suspected criminal activity.

“As the largest shareholder of Allied Newspapers Limited, the foundation is actively following the proceedings, to ensure that the rights at law of all shareholders are protected and safeguarded,” the Foundation said in a statement.