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Matthew Vella
On Friday, former Bank of Industry, Commerce and Agriculture (BICAL) president Cecil Pace took the witness stand in a libel case instituted by former Prime Minister Dom Mintoff against MaltaToday editor Saviour Balzan over the articles carried by this newspaper on the unfolding events of the closure of BICAL, in which MaltaToday stated that Pace was a caught in a “personal vendetta, a web of deceit and Mintoff’s nationalisation frenzy.”
Pace told Magistrate Silvio Meli that in January 1973, he was visited at home by controller Karmenu Mifsud Bonnici, who arrived with a proposal for Pace to sign off half his equities to nominees in return for government contracts and permits to open branches all over the island.
In Court, Cecil Pace said that in his comments to MaltaToday, he had mentioned that the offer had come from Mintoff because Mifsud Bonnici had been sent by him.
Mifsud Bonnici arrived at Pace’s house accompanied by Dr George Schembri, to ask him whether he was going to sign the deal with Mintoff, just a day before his arrest on 6 January, 1973. “His proposals offers you advantages,” Mifsud Bonnici told him. Cecil Pace was told, however, that should he not sign, he would be arrested.
During Friday’s lengthy testimony by Cecil Pace, in which acrimonious accusations were thrown at Karmenu Mifsud Bonnici, a former controller of the BICAL bank who is appearing as attorney to Dom Mintoff, Pace affirmed statements he had told MaltaToday confirming the authenticity of this newspaper’s reports.
Returning to the fore in the BICAL saga is the name of Lawrence Cachia Zammit, a crucial personage in the string of events leading to the end of the BICAL empire. Brother to a former Nationalist Minister of Health Alexander Cachia Zammit and also the treasurer of the Nationalist Party in 1972, Cecil Pace told Magistrate Silvio Meli that Cachia Zammit, a joint manager within BICAL, had withdrawn Lm360,000 in unrecorded foreign transactions from BICAL’s account with Hambros Bank which went towards the setting up of the Nationalist Party’s printing press.
Pace told the Court that Cachia Zammit had withdrawn the money in good faith, and that he had been expecting to be repaid through an inheritance from Count Bernard Manduca, father to his wife Angele.
Pace justified the claims of being a victim of a personal vendetta and a nationalisation frenzy. He said that although his bank was not going to be closed, because Mintoff wanted half of it, “bankers used to suspect” that nationalisation was at hand. “How long did private banks last after Mintoff took power? One or two years? That’s what happened with the National Bank of Malta.”
Pace said he had met with premier Dom Mintoff in the weeks preceding the suspension of his banking licence to discuss the investment of around GBP 1 million from a British financier. New legislation introduced by the Mintoff government had barred any deposit over Lm25,000 without the approval of the Central Bank. Meeting in Castille, Mintoff summoned deputy Central Bank governor RJA Earland and the Minister of Finance, the late Guze Abela, to make facilities available to Pace.
Pace testified in Court that on 25 November, he received a phone call from Robert ‘Bobbie’ Stivala, Guze Abela’s private secretary. Accompanied by his lawyer Albert Ganado, Pace drove to the ministry. Stivala confronted Pace and told him that his companies were being transferred to the government: “From this time on, your bank is no more, I suggest you co-operate fully with the Central Bank.”
In Court Pace also recounted episodes of the way his companies’ assets were squandered under the controllership of Karmenu Mifsud Bonnici. The presence of both men in the same courtroom sparked off accusations from Pace, as he was questioned by the man he deems responsible for the way in which many of his assets were disposed of.
Pace recalled the removal of the Comino Hotel by Mifsud Bonnici. The hotel was purchased by Pace for Lm400,000, ironically with the assistance of Karmenu Mifsud Bonnici, lawyer of the ex-wife of Comino landlord John Gaul.
Pace testified in Court that Karmenu Mifsud Bonnici had given the Comino Hotel to John Gaul for free in order to rid himself of the annual emphytheusis of Lm12,000.
Pace said that in 32 years of administration, over Lm3 million was spent in administration expenses for the controllership of BICAL, a claim which he believes proves how there always were enough assets to pay off the debts and liabilities of the bank and its associated companies.
Pace also recounted how following his arrest in jail, Karmenu Mifsud Bonnici had visited him in jail late at night for him to sign away his ships. When Cecil Pace asked him who the ships were going to be given to and for how much, Mifsud Bonnici refused to tell him. The next day, in Court, Pace got to know through his lawyer that the ships would be sold to the fledgling Sea Malta company for a risible Lm10,000 – a figure well below the Lm500,000 that Pace’s fleet was valued at.
matthew@newsworksltd.com
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