Accutor payments to Muscat stopped after Swiss bank flagged transactions

The VGH inquiry established that Accutor AG’s monthly payments of €15,000 to disgraced former prime minister Joseph Muscat were stopped not only because Accutor went out of business but also because Swiss bank UBS froze the company’s account and all subsequent payments on suspicion of kickbacks.

Even Bank of Valletta, handling Muscat’s account where the suspicious deposits were being received, flagged the payments from UBS to Muscat with the authorities, suspecting money laundering and kickbacks.

According to the inquiry, Muscat started receiving payments from Accutor AG, a Swiss company registered in 2017 to handle Malta government payments from the hospitals’ concession, soon after he was forced to resign in 2019.

Through a ‘consultancy’ agreement, which the inquiry suspects to be a channel for kickbacks, Muscat was to act as a senior advisor to the company funded by the VGH concession, earning him €15,000 a month for three years, which could be renewed for another three years.

After two payments of €15,000 each were made to Muscat in March and April 2020, UBS stopped the payments and froze Accutor AG’s accounts, suspecting money laundering and kickbacks to a PEP (politically exposed person).

To circumvent this problem, the owners of Accutor AG, who, according to the inquiry, were the same owners involved in the VGH concession, changed tack and started paying Muscat his €15,000 monthly fee through another company, Spring X Media AG, another Swiss firm run by the owner of Accutor – Pakistani businessman Wasay Bhatti.

This ‘arrangement’ was also short-lived. After two other payments to the former disgraced prime minister, payments had to stop again due to suspicions of money laundering flagged by the banks involved.

Muscat is now facing charges of bribery, fraud and money laundering.

A joint investigation published in May 2023 by The Shift, The Times of Malta and OCCRP found that the payments to Muscat started two months after he resigned as prime minister, and the payments were seemingly disguised as consultancy fees.

Transactions of Accutor AG, the Swiss payroll company that played a key role in funnelling funds from VGH-Steward and Bluestone, show that the companies sent at least €7 million to Accutor, which then directed payments toward VGH directors and hidden investors.

The suspicion is that a layering process was employed through the companies to hide the funds’ origins. Layering is the second of the three stages of money laundering when successive layers of legitimacy are added to the ill-gotten funds until their source is sufficiently obscured from authorities to be undetected as ever having been illegal.

Some common methods of this stage include electronic transfers between countries, using shell companies, and moving funds between multiple banks or accounts within an institution.

Muscat was to receive €540,000 over three years from this ‘consultancy’ but was stopped by the UBS bank flagging and freezing the accounts.

Confirming the joint press investigation’s findings, the inquiry concluded that Accutor Consulting AG and Spring X Media AG shared the same Zurich offices. According to two former senior company employees, data was frequently and meticulously shredded, and bags regularly left the Zurich offices.

Muscat pleaded not guilty and insisted that the payments were connected to legitimate work as a consultant. He never explained his work but insisted he would do so in court.

He also told journalists he “was not aware” that Shaukat Ali, identified in the inquiry as the real brains behind the VGH multi-million deal, and his son Asad, also accused, were also ‘consultants’ to Accutor.

Muscat told The Shift he had been introduced to Accutor’s owner Bhatti “years back” by his former chief of staff, Keith Schembri, and that Bhatti got in touch with him “after I announced my resignation.”

The inquiry concluded that millions passed through Accutor from payments derived from government funds paid to VGH or Steward as part of the concession.

The inquiry described Accutor AG as “a criminal enterprise”.

This report was brought to you with the support of the Daphne Caruana Galizia Foundation.