Shaukat Ali put on hospitals concession payroll on Keith Schembri’s insistence

Shaukat Ali, a Pakistani businessman considered to be one of the brains behind the fraudulent multi-billion-euro hospitals concession, was put on the Vitals Global Healthcare (VGH) payroll on the direct insistence of the Office of the Prime Minister, the most recent National Audit Office report into the concession shows.

In his deposition to the NAO, VGH co-owner Ram Tumuluri said it was former prime minister Joseph Muscat’s right-hand man Keith Schembri who, in 2015, recommended Shaukat Ali be placed on the concession’s payroll.

“The Director VGH (Tumuluri) indicated that when the concession was awarded to VGH in 2015, Shaukat Ali was employed as a general consultant to VGH following a recommendation by the Chief of Staff OPM (Keith Schembri). According to the Director VGH, Shaukat Ali then recommended his son, Asad Ali, to VGH, who was employed as a public relations and marketing consultant by VGH.”

Shaukat Ali, who resides in Malta and has a Maltese passport, was one of the signatories of a sketchy Memorandum of Understanding in 2014 that preceded the concession by a year.

Together with the eventual investors of VGH, Ali signed the deal with Economy Minister Chris Cardona and Malta Enterprise, headed by Mario Galea.

The MoU was one of the main sticking points that led the court to annul the eventual 30-year concession with the government of Malta, declaring it fraudulent last February.

The NAO noted its “concerns regarding the integrity of this concession resonate with the ample press coverage alleging the substantial payments that Shaukat Ali, Asad Ali and other family members, directly and through companies that they were involved in, reportedly received from VGH and the Steward Health Care.

“The central role of the Chief of Staff OPM (Keith Schembri), as highlighted by the Director VGH (Ram Tumuluri), would aggravate these concerns.”

‘I reluctantly complied’ to appoint Ali – Tumuluri

Tumuluri appears to have gone even further in his whistleblower complaint to the US Securities and Exchange Commission recently reported by The Shift and its investigative partners, The Times of Malta and the Organised Crime and Corruption Reporting Project (OCCRP).

Apparently, he could do so because the SEC offered him legal safeguards that the NAO was not empowered to give.

In his affidavit to the SEC, Tumuluri claims that once the concession was awarded, Schembri “demanded that I appoint Mr Shaukat Ali as a consultant of the VGH companies”.

He said the reason behind the request was for Ali “to bridge the process” between the government of and VGH.

“I was reluctant to have Mr Shaukat Ali appointed to fulfil such role however to safeguard the Concession and for the benefit of the VGH companies, I reluctantly complied,” Tumuluri says in his disclosure.

He says that once Shaukat Ali was appointed, he started pressuring Tumuluri to appoint his two sons Wajid Ali and Asad Ali “and other individuals known to him to occupy various roles within the VGH Companies.

“It was clear that these requests were coming from Mr Keith Schembri.”

Tumuluri says that he also needed to comply with those requests “to safeguard the concession and for the benefit of the VGH Companies.”

Schembri pressured Tumuluri to give Ali VGH shares

According to Tumuluri’s account to the SEC, matters continued to degenerate from there.

“As time went by both Mr Keith Schembri and Mr Shaukat Ali were pressuring me to issue shares in the VGH Companies to Mr. Shaukat Ali,” Tumuluri told the SEC.

“I could not comply with this request, but due to the mounting pressure, I gave an option on the shares in the top tier company held in Jersey to Mr Shaukat Ali’s company. This option was for 40% of the ultimate shares held in Jersey.”

The Shift and its investigative partners have reported financial transactions showing a payment of €1.7 million for Shaukat Ali and his family members and another €5 million for Mount Everest General Trading LLC company, in which Shaukat Ali was the sole shareholder, for ‘consultancies’ and ‘loans’.

Mount Everest Investments Ltd, another company owned by Shaukat Ali, was among a chain of 12 Vitals-related companies first set up in Jersey in October 2016, as revealed by The Shift.

Insiders claimed with the investigation that Mount Everest was established to make payments to Shaukat Ali’s family. Ali confirmed that he received money to pay for properties and bonuses in addition to his salary.

One son, Asad Ali, saw €635,000 in payments as a salary, consultancy fees and reimbursements, while another, Wajid Ali, received €500,000 in salary and expenses from VGH.

According to the financial records, Shaukat Ali received another €313,000 in personal payments for ‘consultancy’ and ‘marketing’.

In his affidavit, Tumuluri says that in September 2017, he was called into Schembri’s office at the OPM, where Shaukat Ali and his son Asad Ali were present along with Schembri.

“During this meeting, Mr Schembri demanded that the shares in the VGH Companies be allocated to Mr Shaukat Ali (despite the share option having already been granted) and also that the in-house legal counsel, Deborah Chappell, and head of PR, Alessandra Pace, be terminated.

“I was clearly told that if I would not comply with these demands, the Government of Malta would throw me out and replace me with someone else who would comply with their demands.”

Tumuluri says he refused to comply with those demands “as it was not in the benefit of the VGH Companies nor the concession”.

Tumuluri says he was eventually forced to sell the concession to Steward Health Care after several death threats and other ominous warnings made to him by Schembri and Ali.