Suspicious payments to blacklisted consultant identified in transport contracts probe

A financial investigation has uncovered potentially suspicious payments linking blacklisted consultant Shiv Nair, a former Maltese government adviser, to Malta’s public transport contract and the Kappara junction project.

Shiv Nair, who was blacklisted by the World Bank for fraud and corruption in 2000, was flagged during a financial investigation of former Transport Malta CEO James Piscopo.

Several consultancy payments received by Piscopo were flagged as suspicious by investigators. The payments coincided with the period that Piscopo oversaw the granting of the public bus service concession to a Spanish operator and the construction of the Kappara junction by a Spanish company.

Piscopo was the subject of a police investigation.

Fresh details of this probe are being revealed in a joint investigation by MaltaToday, Amphora Media and the Times of Malta.

Investigators found that considerable amounts of money were transferred over a short period of time. 

The transactions involved Malta Public Transport Ltd, a Maltese company owned by Spanish firm Autobuses de Leon, and Spanish company Constructora San Jose SA, channelling funds to Spanish companies Hasaura Real Estate SL and Translock IT SL.

At the time of these transactions, both recipient companies were under the directorship of Carlos Yanguas Gomez de la Serna, a relative of a former Spanish member of parliament. 

According to investigators, the funds were subsequently funneled to bank accounts in the United Arab Emirates and Hungary, specifically under Aiken Spencer Ltd, a company whose director was identified as Shiv Nair.

Further scrutiny into financial dealings connected to the case uncovered transactions involving Burmah Oil Ltd, another company owned by Shiv Nair. 

Suspect consultancy payments to James Piscopo

In 2016, the former Transport Malta CEO James Piscopo set up an investment firm of his own – Undecim Five – with the help of accountant and friend Robert Borg.

Piscopo is a former Air Malta accountant who was eventually seconded to the Labour Party as its CEO, while Borg has served as the General Workers Union’s financial controller. In May 2013, a couple of months after Labour’s election victory, Borg was also appointed on the board of the Water Services Corporation, ARMS Ltd and the Malta Statistics Authority.

After the 2013 election, Piscopo was appointed CEO at Transport Malta, which until then was both transport regulator and road builder.

Financial intelligence also reveals that Piscopo deposited nine cheques from Robert Borg into his account, amounting to €30,000. Seven of these transactions raised suspicions among investigators due to the unusual nature of both the payee and payer being Borg. The pattern of round-figure amounts, coupled with the absence of clear links between the individuals, led authorities to suspect an effort to obscure their financial dealings.

Piscopo acknowledged the payments but insisted they were related to consultancy work with Borg, calling them "stupid" but not illegal. He denied being part of any form of a kickbacks scheme.

Documents reviewed by MaltaToday however indicate that the investigation was unable to establish a direct financial link between Piscopo and Nair.

Nair has refused to answer questions regarding the payments, insisting all transactions were private and legitimate.

Borg also declined to comment on his financial dealings with Piscopo, but disputed the existence of transaction records between himself and a Maltese company owned by Nair. He insisted that he had never met or had any dealings with Nair.

Spanish-led firms behind Kappara Junction and Malta bus contracts

The Kappara Junction project and Malta’s public transport service contract were both awarded to Spanish-led contractors in 2015, under the oversight of James Piscopo as its CEO. 

A consortium led by Constructora San Jose SA secured the Kappara Junction contract, while Autobuses de Leon was handed control of Malta Public Transport, the operator of the island’s bus service. Piscopo, who headed Transport Malta at the time, also chaired the tender evaluation committee that selected Autobuses de Leon.  

Investigators later uncovered financial transactions linking the two projects to a Spanish corruption case. Between 2015 and 2018, Constructora San Jose SA and Malta Public Transport wired a total of €5.1 million from Malta to Spain. The funds were allegedly transferred to two Spanish firms, Hasaura Real Estate SL and Translock IT, both controlled by Luis Carlos Yanguas, the nephew of a former Spanish MP now facing corruption charges.  

Spanish authorities have charged ex-MPs Pedro Ramón Gómez de la Serna and Gustavo de Arístegui with running a criminal network that secured foreign contracts through illicit means. Yanguas, while not facing charges himself, is believed to have acted as a “commission agent” for Voltar Lassen, a company linked to Serna and implicated in the Spanish probe.  

Spanish court filings also list ALSA - an affiliate of Malta Public Transport - and Constructora San Jose as “clients” of Voltar Lassen.

Spanish contractors deny wrongdoing over Malta transport payments

Spanish firms linked to Malta’s public transport and infrastructure contracts denied any wrongdoing, insisting that payments flagged by investigators were legitimate business transactions.

A spokesperson for Autobuses de Leon said the money transferred to Hasaura Real Estate SL and Translock IT were part of a service contract signed by Malta Public Transport to enhance fleet management. The deal was initially signed with Hasaura Real Estate SL before being transferred to Translock IT, a subsidiary of the same company.

According to the spokesperson, Translock IT specialises in technological solutions for public transport efficiency, including real-time route monitoring, optimisation, and data analysis. They also stressed that Autobuses de Leon had no dealings with Nair and was “completely unaware” of any money transfers to companies linked to him.

A spokesperson for Malta Public Transport similarly distanced the payments from the awarding of the public transport concession, insisting that the contract was won through a competitive process. Malta Public Transport never had a relationship with Nair, the spokesperson said.

Meanwhile, a representative for Constructora San Jose SA said that the company always acts within the strictures of the law.

Former Spanish MP Pedro Ramón Gómez de la Serna, who is facing corruption charges in Spain, admitted through his lawyer that he had encountered Nair in Colombia for an unrelated project that was never executed. However, he claimed to have had no knowledge of any business dealings between Nair and his nephew, Luis Carlos Yanguas.

Yanguas, who controls Hasaura Real Estate SL and Translock IT, also denied any connection between the payments and his uncle. He insisted that the transactions were part of a client-supplier relationship and were supported by full documentation.

A spokesperson for Transport Malta said the Kappara Junction project and the public transport contract were independently audited by the European Commission and the National Audit Office, respectively.

Shiv Nair and his ties to Maltese government

Shiv Nair was engaged as a consultant in 2013 by Malta Enterprise, the government’s investment arm, to attract foreign direct investment.

Nair had even been spotted in Qatar alongside Energy Minister Konrad Mizzi for meetings with Qatari officials. 

A letter of engagement issued by Malta Enterprise chairman Mario Vella in June 2013 confirmed that Nair was to be paid €6,000 for his services, with expectations of “concrete results” by the end of the year.

Despite this, the prime minister at the time Joseph Muscat insisted that no formal contract was signed, and that Nair was never paid by the government. Muscat also claimed that his administration was unaware of Nair’s permanent debarment by the World Bank, which blacklisted him in 2000 for corrupt practices. Nair was reportedly blacklisted a second time after attempting to change his name.

Nair’s relationship with Muscat did not stop here. According to the Vitals inquiry report, in 2016 Muscat received an email “in the strictest confidence” from Nair warning him about the hospitals concession. 

He told Muscat that a UK company was asked to investigate the hospitals’ tender at the request of a Belgian law firm acting on behalf of a Maltese client. 

Muscat did not respond to the email but forwarded it to his chief of staff Keith Schembri without comment. Schembri then forwarded the email to Konrad Mizzi without comment.

Correction: A sentence in this article was removed to more accurately reflect a denial from one of the mentioned parties