Part VI: A circumstantial EU hanging

BRUSSELS - When Olaf chief Giovanni Kessler stood in front of the Brussels press corps on 17 October 2012 - the day after John Dalli i lost his job - his message was not an easy one to sell.

He first said there is "no conclusive evidence of the direct participation of the commissioner,” in the attempt to solicit a bribe.

He then added, gripping the edge of the podium with his left hand as he read his statement, that there is “unambiguous and converging circumstantial evidence” that Dalli was aware of the attempted bribe.

Journalists, in a prior press briefing with EU commission spokesperson Pia Ahrenkilde Hansen, had already started giving the EU side a hard time.

"If someone makes an indecent proposal to you, as Swedish Match described it, is that really your fault unless you indicate that you are inclined to be indecent?" one reporter asked.

"What is the fault? Is it that he [Dalli] didn't actually denounce the attempt to the commission, to Barroso?" another one asked.

Hansen stonewalled.

She said only that the Olaf report had been handed over to Maltese authorities and that Dalli had resigned, leaving the journalists frustrated.

The media’s curiosity was piqued still further when Dalli, in a video-taped interview with New Europe later the same morning, refuted all the claims, noting that he had not even been allowed to see the Olaf report.

What more do you want?

At first glance, Olaf’s leaked report on the five-month investigation appears convincing.

It contains a heap of “circumstantial evidence”: witness statements; records of phone calls; the verbatim transcript of one wire-tapped conversation; corresponding emails and SMS-es; records of related meetings; and notes on the intertwined histories of the main protagonists.

It says Dalli first met tobacco lobbyists - BAT and Estoc’s Tomas Hammargren - in the swimming trunks encounter at the Kempinski in Malta on 20 August 2010.

It says he met lobbyists a second time - Gayle Kimberley and Silvio Zammit, who were now working for Swedish Match - at his own office in St Julians, Malta on 6 January 2012.

It says he was likely in contact with them a third time - via Zammit - at his private residence in Malta on 10 February 2012.

It also notes that there were numerous phone contacts between Dalli and the lobbyists before and after the 6 January and 10 February meetings.

Dalli and Zammit contacted each other 23 times between 5 January and 17 July 2012. When busy, Dalli would respond after a few seconds, multiplying the number of individual calls.

“They [the call logs] attest the frequency of the conversations of these two persons and also the fact they communicated at key stages of the illicit negotiation carried out by Mr Zammit,” the Olaf press office told this website.

Olaf says the logs, obtained by Maltese authorities, shows that at one point Zammit interrupted a call to a tobacco lobbyist, Inge Delfosse, called Dalli, then called Delfosse back.

In a transcript of the latter Delfosse call, Zammit asked her for a bribe.

“The logs also show that after being interviewed by Olaf, Mr Zammit called Mr Dalli”, the Olaf press office added.

Kimberley and Zammit themselves exchanged 20 phone calls and sent each other dozens of text messages between 13 February and 5 July 2012.

Meanwhile, Kimberley’s written report to Swedish Match on the 6 January meeting sounds damning.

“You will be glad to hear he [Dalli] has an open mind and is in no way pre-conditioned [against snus]”, she said.

“I think if any commissioner has what it takes to lift the ban it’s this one … I have direct access to the commissioner to send any emails or information we want passed to him.”

Her oral report to Swedish Match on the 10 February meeting sounds even more damning.

She says that she, Dalli, and Zammit on 10 February hatched the whole plan which led Zammit to later ask Swedish Match for the €60 million bribe.

She notes they talked about who to nominate in Dalli’s cabinet in order for the snus plan to go well, who Dalli’s “friends” are in the commission, Swedish Match’s annual profit, and how Dalli intends to proceed with the “snus ban and what does he need?”.

The Kimberley bombshell

But the Olaf report also records a huge discrepancy on the 10 February meeting at Dalli’s house.

Kimberley originally told Swedish Match she went to Dalli’s residence with Zammit.

But when questioned by Kessler at a meeting in Troia, Portugal, she told him she had lied to the Swedish firm, possibly in order to help secure her €5,000 consultancy fee.

She also told Kessler that her role was limited to helping Zammit prepare for the 10 February encounter with Dalli.

She said she gave the Peppi’s owner a paper entitled “Meeting with Commissioner” on the strategic plan of attack, which he returned to her later on 10 February, purportedly with his handwritten notes in the margins.

Olaf says the handwritten notes are proof that Zammit and Dalli did discuss snus on 10 February.

It noted that telephone calls were made on the same day between Zammit, Kimberley, and Swedish Match executive John Gabrielsson.

But Zammit’s responses to the questions in Kimberley’s paper make little sense.

Zammit, for instance, writes “France” next to the question: “Who are the friends of Dalli in the commission and what countries does he have a good relations with?”.

For Dalli to say France is an ally for lifting the snus ban is unlikely.

French diplomats and Dalli had in fact fallen out when Dalli approved the cultivation of genetically-modified potatoes in Europe by German chemical giant BASF.

The most likely pro-snus member states would be Sweden - whose ministers have long pushed for the sale ban to be lifted - and the UK, through its affiliations with British American Tobacco.

Olaf investigators also swept the marked up paper for Dalli’s fingerprints and found nothing.

So what really happened on 10 February?

Zammit and Dalli admit that they met, but they say they didn't discuss snus and talked instead about local politics.

Their version has some plausibility: Zammit was at the time running for local city council. He had in the past worked as a canvasser for Dalli and had been chosen by the Nationalist Party to stand for office in the town of Sliema.

Elections were less than a month away, in a campaign which saw Zammit grab the seat as deputy mayor on 11 March. Another 50 or so votes and he would have been mayor.

Grist to Dalli’s mill

Kimberley’s Olaf testimony also undermines the importance of the phone contacts.

She told Kessler that her phone calls and texts with Zammit had nothing to do with snus.

“Whenever I had a conversation with Silvio Zammit it was either non-snus related or about my introduction to BAT,” she said.

Her Olaf statements are grist to Dalli’s mill.

He claims he did not report the Hammargren meeting or the 6 January meeting at St Julians because he thought they were insignificant.

He notes that the Hammargren encounter looked like a coincidence and that Zammit, on 6 January, never told him that Kimberley was already working for Swedish Match.

Zammit defenders say if Kimberley was prepared to lie to Swedish Match about the 10 February meeting, then might she not have embellished her report on the 6 January encounter in order to impress the Swedish firm?

Dalli also told EUobserver that after 6 January “Silvio [Zammit] never came back to me with anything on this issue [snus]”.

Meanwhile, EUobserver has seen new evidence which suggests Kimberley was more deeply involved in the attempted bribe than she led the Olaf investigators to believe.

In this series of eight articles, EUobserver reporter Nikolaj Nielsen takes a closer look at events which, in the words of one MEP, will haunt Brussels for the next 10 years to come.

Introduction - EU smoke & mirrors

Part I - From Peppi's to Barroso's

Part II - Malta's 'Mr Teflon'

Part III - Actors assemble for EU melodrama

Part IV - EU judges, Maltese mysteries, and Christians in the Caribbean

Part V - Dalli’s big tobacco theory

Part VI - A circumstantial EU hanging

Part VII - €60mn Valentine's Day gift - will be published on Tuesday 11 November