Two men have been fined nearly €26 million are being found guilty of fraud and tax evasion in relation to the delivery of tobacco products in Malta.

Keith Attard and Marvin McKay, the director and employee of K&L Attard Co Ltd, a tobacco wholesale company, were accused of abusing a duty suspension scheme where taxes and excise duties were not being paid by the company once the tobacco products were delivered to them from four other local tobacco importers.

The pair were found guilty of fraud and given a 15-month jail sentence suspended for three years. Attard was fined €13,025,538 and McKay was fined €12,719,865.

One-quarter of their fines are to be paid immediately as part of a civil debt owed to the Director of Customs, the Times of Malta reported.

The case goes back to the months between March and December 2007, where the company did not pay its excise duty and taxes for cigarettes. Authorities found a “gross discrepancy” between the declared value of the products and the quantities being brought in.

Customs officials eventually searched the warehouses of the company and found that there were fewer stocks than had been declared.

Further searches of their offices, as well as double-checking their Internal Administrative Accompany Documents (IAAD), found that most documents bore McKay’s signature.

The economic crimes unit soon after charged company director Attard and his employee McKay.

Magistrate Ian Farrugia, who presided over the case, said the duo had “had knowingly cooperated to evade tax. The accused knew what they were doing and the evidence showed that they effectively intended to do what they did”.

A third co-accused and former director of the company has since passed away.

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