BCA chief writes €55,000 cheque to himself following ‘fake termination’

Jesmond Muscat, handpicked by the government for the role of CEO of the Building and Construction Agency (BCA) only a few months ago, had issued an unauthorised €55,000 payment to himself when he was CEO of another government agency, according to court documents.

The situation had led to legal proceedings in court, which were somehow dropped by the government in a secret out-of-court settlement.

Court documents show the government claimed that Muscat’s claims of job termination were false and concocted for him to receive tens of thousands in compensation.

The government has never said anything about this issue, keeping it hidden from the public.

Despite this record, Public Works Minister Stefan Zrinzo Azzopardi still chose Muscat to head the new agency established to regulate the construction industry.

The agency involved is the same one that later gave a phantom job to Melvin Theuma, the middleman in the assassination of journalist Daphne Caruana Galizia.

The Jesmond Muscat case and his €55,000 cheque to himself

Research conducted by The Shift goes back to 2016, during the first administration of disgraced former Prime Minister Joseph Muscat.

While at the time the social housing sector fell under the political wing of (former) Minister Michael Farrugia, Jesmond Muscat (until then a case officer at the Planning Authority), was given a one-year contract to work as a Project Manager with a new government company called Housing Project Management Unit, now known as Social Projects Management.

The company was responsible for managing social housing projects.

According to court documents, just a month after Muscat was appointed Project Manager, the chairman at the time, Paul Mifsud (an accountant from Mellieha), decided to appoint Muscat as temporary CEO.

Although his contract stated the CEO signed it, it emerged that it was only signed by the chairman since no CEO was in place.

A year later, on 1 April 2017, the chairman decided to give Muscat another contract, this time as CEO, with the same remuneration he had as Project Manager.

Yet, a clause was inserted in the new contract stating that Muscat would be eligible for a full year’s pay as compensation in case of termination.

Following the June 2017 general elections and the Labour Party’s re-election, Minister Farrugia was removed from the housing portfolio, which was transferred to Minister Roderick Galdes.

Court documents show minutes of a brief board meeting “held somewhere in Msida” in which Mifsud, the chairman, decided that “due to present circumstances in which works and positions are overlapping, Jesmond Muscat will cease to occupy the post of CEO”.

The next day, 8 September 2017, a public holiday, Muscat issued a cheque to himself for €55,000 from the government’s agency’s funds – without any authorisation – amounting to a one-year salary in what he said was his due compensation.

A few days later, he informed the new Minister, Roderick Galdes, that he was very willing to meet his successor for a handover.

Muscat was later forced to return the funds he took without any permission.

Court case dropped after secret arrangement

The story did not end there.

Since the new minister refused to pay any compensation to Jesmond Muscat, arguing that he was not entitled to it, Muscat took the government company to court, accusing it of breach of contract.

In its reply, the government claimed that the decision on Muscat’s termination was taken in “strange circumstances” and aimed at making Muscat eligible for tens of thousands of euros in terminal benefits.

The company said it wanted to question the chairman, Mifsud, in court (he was removed by then) to explain “what he was alluding to when asking Mifsud to refrain from his post as CEO” and the real reasons behind his decision.

Despite the severe accusation, the ministry and Muscat later came to some form of out-of-court settlement. Muscat informed the court that he was dropping the case.

Muscat did not reply to questions from The Shift for details on the out-of-court settlement and whether this involved monetary compensation, another government job or any other form of compensation.

Minister Roderick Galdes also refused to answer questions.