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Exclusive: Behind FTX’s fall, battling billionaires and a failed bid to save crypto

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Nov 10 (Reuters) – (This story contains language some readers may find offensive in paragraph 2)

On Tuesday morning, Sam Bankman-Fried, owner of cryptocurrency exchange FTX, caught his employees off-guard with a somber message.

“I’m sorry,” he told them. “I fucked up.”

The reason for the mea culpa: His announcement half an hour earlier that FTX’s arch-rival, Binance, planned to mount a shock takeover of its main trading platform to save it from a “liquidity crunch.” Binance founder Changpeng “CZ” Zhao, whom the billionaire had accused of sabotage, would now be his White Knight.

The seeds of FTX’s downfall were sown months earlier, stemming from mistakes Bankman-Fried made after he stepped in to save other crypto firms as the crypto market collapsed amid rising interest rates, according to interviews with several people close to Bankman-Fried and communications from both companies that have not been previously reported.

Some of those deals involving Bankman-Fried’s trading firm, Alameda Research, led to a series of losses that eventually became his undoing, according to three people familiar with the company’s operations.

The interviews and messages also shine new light on the bitter rivalry between the two billionaires, who in recent months competed for market share and publicly accused each other of seeking to hurt the one another’s businesses. It culminated on Wednesday, with Binance pulling out of its deal and throwing FTX’s future into uncertainty.

Stuck without a buyer, Bankman-Fried was now searching for alternative backers, two people close to him said. After Binance pulled out, he told FTX staff in a message that Binance had not previously told them of any reservations about the deal and he was “exploring all options.”

Neither Binance nor FTX responded to requests for comment. Bankman-Fried told Reuters on Tuesday that “I’ll probably be too swamped” to do interviews. He didn’t respond to further messages.

Binance earlier said it decided to pull out of the deal as a result of its due diligence on FTX and news reports about U.S. investigations into the company.

Zhao’s unveiling of the planned takeover capped a stunning reversal for Bankman-Fried. The 30-year-old had set up Bahamas-based FTX in 2019 and led it to become one of the largest exchanges, accumulating a near $17 billion fortune.

News of the liquidity crunch at FTX – valued in January at $32 billion with investors including SoftBank and BlackRock – sent reverberations through the crypto world.

The price of major coins plummeted, with bitcoin slumping to its lowest in almost two years, heaping further pain on a sector whose value has fallen about two-thirds this year as central banks tightened credit.

By ditching the deal, Binance had also avoided the regulatory scrutiny that would likely have accompanied the takeover, which Zhao had flagged as a likelihood in a memo to employees that he posted on Twitter.

Financial regulators around the world have issued warnings about Binance for operating without a license or violating money laundering laws. The U.S. Justice Department is investigating Binance for possible money laundering and criminal sanctions violations. Reuters reported last month that Binance had helped Iranian firms trade $8 billion since 2018 despite U.S. sanctions, part of a series of articles this year by the news agency on the exchange’s financial crime compliance.

RELATIONSHIP SOURS

Zhao and Bankman-Fried’s relationship began in 2019. Six months after FTX’s launch, Zhao bought 20% of the exchange for about $100 million, a person with direct knowledge of the deal said. At the time, Binance said the investment was “aimed to grow the crypto economy together.”

Within 18 months, however, their relationship had soured.

FTX had grown rapidly and Zhao now viewed it as a genuine competitor with global aspirations, former Binance employees said.

When FTX in May 2021 applied for a license in Gibraltar for a subsidiary, it had to submit information about its major shareholders, but Binance stonewalled FTX’s requests for help, according to messages and emails between the exchanges seen by Reuters.

Between May and July, FTX lawyers and advisors wrote to Binance at least 20 times for details on Zhao’s sources of wealth, banking relationships, and ownership of Binance, the messages show.

In June 2021, however, an FTX lawyer told Binance’s chief financial officer that Binance wasn’t “engaging with us properly” and they risked “severely disrupting an important project for us.” A Binance legal officer responded to FTX to say she was trying to get a response from Zhao’s personal assistant, but the requested information was “too general” and they may not provide everything.

By July of that year, Bankman-Fried had tired of waiting. He bought back Zhao’s stake in FTX for about $2 billion, the person with direct knowledge of the deal said. Two months later, with Binance no longer involved, Gibraltar’s regulator granted FTX a license.

That sum was paid to Binance, in part, in FTX’s own coin, FTT, Zhao said last Sunday – a holding he would later order Binance to sell, precipitating the crisis at FTX.

Reuters Graphics

“TRYING TO GO AFTER US”

This May and June, Bankman-Fried’s trading firm, Alameda Research, suffered a series of losses from deals, according to three people familiar with its operations. These included a $500-million loan agreement with failed crypto lender Voyager Digital, two of the people said. Voyager filed for bankruptcy protection the following month, with FTX’s U.S. arm paying $1.4 billion for its assets in a September auction. Reuters could not determine the full extent of losses Alameda suffered.

Seeking to prop up Alameda, which held almost $15 billion in assets, Bankman-Fried transferred at least $4 billion in FTX funds, secured by assets including FTT and shares in trading platform Robinhood Markets Inc, the people said. Alameda had disclosed a 7.6% share in Robinhood that May.

A portion of these FTX funds were customer deposits, two of the people said, though Reuters could not determine their value.

Bankman-Fried did not tell other FTX executives about the move to prop up Alameda, the people said, adding he was afraid that it could leak.

On Nov. 2, however, a report by news outlet CoinDesk detailed a leaked balance sheet that allegedly showed that much of Alameda’s $14.6 billion in assets were held in FTT. Alameda CEO Caroline Ellison tweeted that the balance sheet was merely for a “subset of our corporate entities,” with over $10 billion of assets not reflected. Ellison did not return requests for comment.

That failed to douse growing speculation over what Alameda’s financial health might mean for FTX.

Then Zhao said Binance would sell its entire share in the token, FTT, worth at least $580 million, “due to recent revelations that have come to light.” The token’s price collapsed 80% over the next two days and a torrent of outflows from the exchange gathered pace, blockchain data show.

WITHDRAWAL SURGE

In his message to staff this week, Bankman-Fried said the firm saw a “giant withdrawal surge” as users rushed to withdraw $6 billion in crypto tokens from FTX in just 72 hours. Daily withdrawals normally totaled tens of millions of dollars, Bankman-Fried told his employees.

After Zhao’s tweet that Binance would sell its FTT holding, Bankman-Fried projected confidence that FTX would weather its rival’s attacks. He told staff on Slack that withdrawals were “not shockingly, way up,” but they were able to process the requests.

“We’re chugging along,” he wrote. “Obviously, Binance is trying to go after us. So be it.”

But by Monday the situation became dire. Unable to quickly find a backer, or sell other illiquid assets short-notice, Bankman-Fried contacted Zhao, according to a person familiar with the call. Zhao later confirmed that Bankman-Fried had called him.

Bankman-Fried signed a non-binding letter of intent for Binance to buy FTX’s non-U.S. assets. This valued FTX at several billion dollars, two people familiar with the letter said – enough for the exchange to cover all withdrawal requests but a fraction of its January valuation.

Zhao announced the potential deal several hours later, with Bankman-Fried tweeting “a huge thank you to CZ.”

“Let’s live to fight another day,” Bankman-Fried told staff on Slack.

His employees were shocked. Even executives had been in the dark about the Alameda shortfall and takeover plan until Bankman-Fried informed them that morning, two people working with him said. Both people said they had been unaware that the withdrawal situation was so serious.

Then came Binance’s announcement on Wednesday scrapping the takeover. “The issues are beyond our control or ability to help,” Binance said. Zhao tweeted “Sad day. Tried,” with a crying emoji.

Reporting by Angus Berwick in New York and Tom Wilson in London; additional reporting by Hannah Lang in Washington and Elizabeth Howcroft in London; Editing by Paritosh Bansal and Chris Sanders

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Business

Binance plans to buy FTX’s non-U.S. operations in latest crypto bailout

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WASHINGTON/LONDON, Nov 8 (Reuters) – Crypto giant Binance signed a nonbinding agreement to buy rival FTX’s non-U.S. unit, FTX.com, to help cover a “liquidity crunch” at the cryptocurrency exchange, the companies said on Tuesday, in a surprise move that raised fresh concerns about the risks investors face in the volatile crypto market.

Binance CEO Changpeng Zhao said in a tweet that FTX, run by billionaire Sam Bankman-Fried, had “asked for our help” after “a significant liquidity crunch.”

He said Binance, the world’s biggest crypto exchange, will be conducting due diligence in the coming days as the next step toward an acquisition of FTX.com. The U.S. operations of Binance and FTX are not part of the deal, Bankman-Fried said in a separate tweet.

“It has been an open secret for a while now that FTX and Binance were in existential competition; the only surprise today is that things have escalated so quickly to a seeming conclusion,” said Joseph Edwards, investment adviser at Securitize Capital. “The move should provide relief to consumers in the short-term, but creates question in the long run.”

The deal is the latest emergency rescue in the world of cryptocurrencies this year, as investors pulled out from riskier assets amid rising interest rates. The cryptocurrency market has fallen by about two-thirds from its peak to $1.07 trillion.

It also underscores an abrupt reversal of fortune for Bankman-Fried, who had positioned himself as the industry’s saviour by rescuing rivals who had gotten into trouble earlier in the year.

“Liquidity crunch issues continue to haunt the crypto market,” said Dan Raju, CEO of Tradier, financial services provider and brokerage. “It’s scary to think that FTX, which is one of the largest crypto exchanges in the world, was bitten by liquidity concerns and Binance, their biggest rival, is coming to their rescue. This will make for some strange bedfellows.”

FTX had seen around $6 billion of withdrawals in the 72 hours before Tuesday morning, according to a message to staff sent by Bankman-Fried that was seen by Reuters.

“On an average day, we have tens of millions of dollars of net in/outflows. Things were mostly average until this weekend, a few days ago,” Bankman-Fried wrote in the message to staff sent on Tuesday morning. “In the last 72 hours, we’ve had roughly $6b of net withdrawals from FTX.”

Withdrawals at FTX.com are “effectively paused,” he wrote, adding that would be resolved in “the near future.”

FTX did not immediately respond to a request for comment on the message to staff.

‘LEGITIMATE REASON TO WORRY’

The deal comes after the in-house token of crypto exchange FTX slumped, losing one-third of its value and dragging down other major digital assets, amid talk of pressure on FTX’s financials.

Binance, which dominates the crypto industry, with over 120 million users, is currently under investigation by the U.S. Justice Department into possible violations of money-laundering rules, Reuters reported last week.

A spokesperson for the U.S. Commodity Futures Trading Commission said the agency is monitoring the situation.

News of the deal initially buoyed major cryptocurrencies, but those gains were quickly erased.

FTX token – which gives holders discounts on FTX trading fees – was last trading at 11.83, down 47%.

Bitcoin , the biggest digital token, was down 6%.

“People have a legitimate reason to worry about the security of their digital assets if one of the world’s largest centralized exchanges ends up in financial difficulties,” said Pascal Gauthier, CEO and Chairman of crypto security firm Ledger. “It’s time for an honest, industry-wide reckoning on the importance of crypto custody.”

Crypto users raised questions on Twitter last week about FTX’s token following a report by news website CoinDesk on a leaked balance sheet from Alameda Research, a trading firm founded by Bankman-Fried that has close ties with FTX.

On Sunday, Zhao said his firm would liquidate its holdings of the FTX token due to unspecified “recent revelations.”

Bankman-Fried had initially said the exchange was “fine” and that concerns were “false rumours.”

In a tweet on Tuesday, he said his teams were working on clearing out the withdrawal backlog: “This will clear out liquidity crunches. This is one of the main reasons we’ve asked Binance to come in.”

“A *huge* thank you to CZ, Binance,” Bankman-Fried wrote, referring to the rival CEO who goes by his initials.

Reporting by Tom Wilson in London and Hannah Lang in Washington
Additional reporting by Tom Westbrook in Singapore, Prentice in Washington and Angus Berwick in New York
Editing by Megan Davies, Catherine Evans and Matthew Lewis

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At COP27, climate change framed as battle for survival

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  • China, United States have leading role
  • Guterres seeks coal phase-out by 2040
  • UAE, host of 2023 talks, says will keep producing fossil fuel

SHARM EL-SHEIKH, Egypt, Nov 7 (Reuters) – World leaders and diplomats framed the fight against global warming as a battle for human survival during opening speeches at the COP27 climate summit in Egypt on Monday, with the head of the United Nations declaring a lack of progress so far had the world speeding down a “highway to hell”.

The stark messages, echoed by the heads of African, European and Middle Eastern nations alike, set an urgent tone as governments began two weeks of talks in the seaside resort town of Sharm el-Sheikh to figure out how to avert the worst of climate change.

“Humanity has a choice: cooperate or perish,” U.N. Secretary General Antonio Guterres told delegates, urging them to accelerate the transition from fossil fuels and speed funding to poorer countries struggling under climate impacts that have already occurred.

Despite decades of climate talks so far, countries have failed to reduce global greenhouse gas emissions, and their pledges to do so in the future are insufficient to keep the climate from warming to a level scientists say will be catastrophic.

Land war in Europe, deteriorating diplomatic ties between top emitters the United States and China, rampant inflation, and tight energy supplies threaten to distract countries further away from combating climate change, Guterres said, threatening to derail the transition to clean energy.

“Greenhouse gas emissions keep growing. Global temperatures keep rising. And our planet is fast approaching tipping points that will make climate chaos irreversible,” he said. “We are on a highway to climate hell with our foot on the accelerator.”

Former U.S. Vice President Al Gore, also speaking at the event, said global leaders have a credibility problem when it comes to climate change and criticized developed nations’ ongoing pursuit of gas resources in Africa, which he described as “fossil fuel colonialism.”

“We have a credibility problem all of us: We’re talking and we’re starting to act, but we’re not doing enough,” Gore said.

French President Emmanuel Macron said that, while the world was distracted by a confluence of global crises, it was important not to sacrifice national commitments to fight climate change.

“We will not sacrifice our commitments to the climate due to the Russian threat in terms of energy,” Macron said, “so all countries must continue to uphold all their commitments.”

British Prime Minister Rishi Sunak said the war was a reason to accelerate efforts to wean the world off fossil fuels.

“Climate security goes hand in hand with energy security, Putin’s abhorrent war in Ukraine, and rising energy prices across the world are not a reason to go slow on climate change. They are a reason to act faster,” he said.

UAE TO CARRY ON PUMPING OIL, GAS

While leaders tended to agree on the risks of global warming, their speeches revealed huge rifts, including over whether fossil fuels could play a role in a climate-friendly future, and who should pay for climate damage that has already occurred.

[1/7] United Arab Emirates President Sheikh Mohamed bin Zayed Al-Nahyan, Egyptian President Abdel Fattah al-Sisi, Secretary-General of the United Nations Antonio Guterres, Crown Prince and the Prime Minister of Bahrain Salman bin Hamad Al Khalifa, Jordan’s King Abdullah II, France’s President Emmanuel Macron, Bulgaria’s President Rumen Radev, Egypt’s Foreign Minister Sameh Hassan Shoukry, Saudi Adel Al-Jubeir, Lebanon’s Prime Minister Najib Mikati and other leaders pose for a family photo during the COP27 climate summit in Sharm el-Sheikh, Egypt November 7, 2022. REUTERS/Mohammed Salem

Immediately after Guterres’ speech urging an end to the fossil fuel era, United Arab Emirates President Sheikh Mohammed bin Zayed al-Nahyan took the stage and said his country, a member of the Organization of the Petroleum Exporting Countries, would continue to produce them for as long as there is a need.

“The UAE is considered a responsible supplier of energy, and it will continue playing this role as long as the world is in need of oil and gas,” he said.

The UAE will host next year’s U.N. conference, which will attempt to finalise agreements made last year in Britain and at this year’s Egyptian talks.

Many countries with rich resources of oil, gas and coal have criticized the push for a rapid transition away from fossil fuels, arguing it is economically reckless and unfair to poorer and less developed nations keen for economic growth.

“We are for a green transition that is equitable and just, instead of decisions that jeopardise our development,” said Macky Sall, president of Senegal and chair of the African Union.

Poorer countries that bear little responsibility for historic carbon emissions have also been arguing they should be compensated by rich nations for losses from climate-fueled disasters including floods, storms and wildfires.

Signatories to the 2015 Paris Agreement had pledged to achieve a long-term goal of keeping global temperatures from rising by more than 1.5°C above pre-industrial levels, the threshold beyond which scientists say climate change risks spinning out of control.

Guterres said that goal was possible only if the world can achieve net-zero emissions by 2050. He asked countries to agree to phase out the use of coal, one of the most carbon-intense fuels, by 2040 globally, with members of the Organisation for Economic Cooperation and Development hitting that mark by 2030.

The head of the International Monetary Fund told Reuters on the sidelines of the conference that climate targets depend on achieving a global carbon price of at least $75 a ton by the end of the decade, and that the pace of change in the real economy was still “way too slow”.

The World Trade Organization, meanwhile, said in a report published on Monday that it should tackle trade barriers for low carbon industries to address the role of global trade in driving climate change.

Read more:

EXPLAINER-A field guide to climate jargon

FACTBOX-COP27: Major players at the U.N. climate talks in Egypt

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Reporting by William James, Valerie Volcovici and Simon Jessop; Editing by Richard Valdmanis, Katy Daigle, Barbara Lewis, Frank Jack Daniel, Deepa Babington and Lisa Shumaker

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Pope dissolves Knights of Malta leadership, issues new constitution

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VATICAN CITY, Sept 3 (Reuters) – Pope Francis on Saturday dissolved the leadership of the Knights of Malta, the global Catholic religious order and humanitarian group, and installed a provisional government ahead of the election of a new Grand Master.

The change, which the pope issued in a decree, came after five years of often acrimonious debate within the order and between some top members of the old guard and the Vatican over a new constitution that some feared would weaken its sovereignty.

The group, whose formal name is Sovereign Military Hospitaller Order of St. John of Jerusalem, of Rhodes and of Malta, was founded in Jerusalem nearly 1,000 years ago to provide medical aid for pilgrims in the Holy Land.

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It now has a multi-million dollar budget, 13,500 members, 95,000 volunteers and 52,000 medical staff running refugee camps, drug treatment centres, disaster relief programs and clinics around the world.

The order has been very active in helping Ukrainian refugees and war victims.

It has no real territory apart from a palace and offices in Rome and a fort in Malta, but is recognised as a sovereign entity with its own passports and licence plates.

It has diplomatic relations with 110 states and permanent observer status at the United Nations, allowing to act as a neutral party in relief efforts in war zones.

Cardinal Silvano Tomasi, the pope’s special delegate to the order, told reporters at a briefing along with some members of the provisional government that the order’s new constitution would not weaken its international sovereignty.

But as a religious order, it had to remain under the auspices of the Vatican, said Cardinal Gianfranco Ghirlanda, a member of the working group that prepared the new constitution approved by the pope on Saturday.

Francis convoked an extraordinary general chapter for Jan. 25 to begin the process of electing a new Grand Master.

The last one, Italian Giacomo Dalla Torre, died in April.

“We hope this will re-establish unity in the order and increase its ability to serve the poor and the sick,” Tomasi said.

Tomasi and the Lieutenant of the Grand Master, Canadian John Dunlap, will lead the group to the general chapter. A new Grand Master is expected to be elected by March, officials said.

Under the previous constitution, the top Knights and the Grand Master were required to have noble lineage, something reformers said excluded nearly everyone except Europeans from serving in top roles.

The new constitution eliminates the nobility rule as well as the tradition of Grand Masters being elected for life.

“It will be more democratic. The question of nobility has now become secondary,” Tomasi said.

Future Grand Masters will be elected for 10-year terms, renewable only once, and will have to step down at age 85.

Reformers, backed by the Vatican, had called for a more transparent government to bring in fresh blood and allow the order to better respond to the massive growth it has seen in recent years.

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Reporting by Philip Pullella, Editing by Louise Heavens

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World

Suspect confesses to killing Malta journalist

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  • George Degiorgio confesses to crime in interview from jail
  • Says he will implicate others in assassination plot
  • Journalist Daphne Caruana Galizia was murdered in 2017

VALLETTA, July 5 (Reuters) – The man accused of detonating a car bomb that killed a prominent Maltese journalist has confessed to the crime in an interview with a Reuters reporter and says he will soon implicate others in plotting to assassinate her.

Speaking from jail in his first comment on the case, George Degiorgio said if he had known more about Daphne Caruana Galizia – the journalist he and two others are accused of killing in 2017 – then he would have asked for more money to carry out the hit.

“If I knew, I would have gone for 10 million. Not 150,000,” he said, referring to the sum in euros that he said he was paid for killing the journalist.

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“For me it was just business. Yeah. Business as usual!” he told a Reuters reporter. He later added, “Of course I feel sorry.”

The interview with Degiorgio was conducted during research for a podcast into the Caruana Galizia case, entitled “Who Killed Daphne?”

His admission came after several attempts by Degiorgio’s lawyers since 2021 to secure a pardon in return for testimony about Degiorgio’s role in Caruana Galizia’s murder and other alleged crimes involving prominent figures on the island.

On June 22, Malta’s Appeal Court rejected remaining legal challenges by Degiorgio to the murder charges against him and his brother Alfred, who is co-accused. The judgement clears the way for trial to go ahead.

The car-bomb assassination of the investigative journalist and blogger caused shock across Europe. Maltese authorities charged Degiorgio and two other men – his brother Alfred and an associate, Vince Muscat – with murdering Caruana Galizia in October 2017 at the behest of a top island businessman.

Degiorgio told Reuters he would plead guilty ahead of any jury trial. “I’m going to speak to the magistrate,” he said. He indicated he would provide testimony to implicate others in the murder and in a previous unrealised plot to kill the journalist. His motive, he said, was to seek a sentence reduction for himself and Alfred and to ensure that “we’re not going down alone!”

Until now, both of the Degiorgio brothers had denied involvement in the killing. Muscat pleaded guilty to the murder charges in 2020 and was sentenced to a reduced term of 15 years in jail in return for testifying about this case and some other crimes.

One of the island’s richest businessmen, Yorgen Fenech, was also charged in November 2019 with commissioning Degiorgio and his two accomplices to carry out the hit. Fenech has denied the charge but has not yet presented his defence. In a statement, his lawyer, Gianluca Caruana Curran, said Fenech planned to prove in court “he at no point wanted, actively searched for or sponsored” Caruana Galizia’s assassination.

“While strongly protesting his innocence, Mr Fenech maintains that with the evidence available, independent and serious investigations are capable of leading to the arrest and arraignment of the true perpetrators behind the assassination.”

Fenech was identified as the mastermind by an alleged middleman, taxi driver Melvin Theuma, who escaped prosecution for his role in the case in return for testifying. Theuma said he arranged the murder with the Degiorgio brothers on Fenech’s behalf. He testified that he never told the Degiorgio gang Fenech’s identity.

In the interview, Degiorgio said he was willing to testify that a top Maltese political figure had tried to arrange a hit on Caruana Galizia in a separate plot two years earlier. Degiorgio also said he would offer to testify about the involvement of two senior former ministers in an armed robbery.

Reuters is not at this stage publishing further details of those allegations or naming the individuals accused by Degiorgio, all of whom deny any involvement in any crime.

Malta Police Force and the prosecutors handling the murder case did not respond to requests for an official comment on Degiorgio’s remarks.

In a further statement to Reuters via their lawyer, George and Alfred Degiorgio said they are seeking a judgment “in line with that already handed down to Vincent Muscat. We are willing to divulge everything we know about other murders, bombs and crimes provided we receive a pardon. We emphasize that the families of other victims should be served justice too.”

Caruana Galizia was killed after she levelled a series of corruption allegations against prominent people, including ministers in the island’s Labour Party government. Her murder raised suspicions that some of the people she was investigating could be involved in plotting her death.

Fenech, who stands accused of ordering up the successful 2017 hit, was first identified in connection with Caruana Galizia in November 2018 articles by Reuters and the Times of Malta. The report named him as the owner of a company known as 17 Black that Caruana Galizia alleged, without citing evidence, was being used to bribe politicians. Fenech was also the head of a controversial power station project in Malta.

According to prosecution evidence presented in court in multiple preliminary hearings since 2018, George Degiorgio and his gang had tracked the journalist throughout the summer of 2017. In the early hours of October 16, 2017, prosecutors allege, the gang planted a bomb under a seat in her car.

That afternoon, Degiorgio was allegedly on a yacht in the island’s Grand Harbour when his brother Alfred, who was watching the house, called to say Caruana Galizia had entered her car and driven off. Degiorgio then sent a text message from the yacht to a mobile device that detonated the bomb, prosecutors told the court.

After the car exploded, Caruana Galizia’s son Matthew heard the blast, ran out from the family home and discovered his mother’s body. He has been campaigning for justice for his mother ever since. Asked about Degiorgio’s comments, he told Reuters: “George Degiorgio’s own words show he is a stone-cold killer undeserving of any reprieve.”

Arrested two months after the killing, George Degiorgio said nothing to police, declining even to give his name during interrogation. Until the Reuters interview, he had remained silent, and his lawyers have spent four years denying he was involved in the murder. He has also filed a series of legal challenges contesting the evidence against him.

But he is now seeking a deal with the prosecution, ahead of a trial, in return for admitting the charges and providing the new information.

Alfred Degiorgio, like his brother, has pleaded not guilty to murder charges but has not presented his case. He too has made several applications to be pardoned of the charges in return for testifying about what he knows.

George Degiorgio said that before taking the hit job, he hadn’t known much about Caruana Galizia or her family, including the fact that they were ordinary people, not criminals. “That’s it. Of course! I never met her in her life,” he said.

The Degiorgio brothers have made several bids since March 2021 for an official pardon for their crimes. The latest, filed on April 4 by their lawyer, William Cuschieri, said, without giving names or specifics, that the Degiorgios could testify to “Crimes of attempted violent robbery and attempted voluntary homicide in which one of the authors was a Minister and another author who is a Minister.” The request was rejected by Malta’s government on April 24, citing the national interest and the administration of justice, according to an official statement.

Malta’s prime minister, Robert Abela, previously condemned attempts by the Degiorgios to win a pardon, calling them “criminals” seeking to buy their freedom. Cuschieri, the lawyer for the Degiorgios, responded by saying the prime minister was breaching their rights to a fair trial and, without providing details, said the brothers had “direct information” about a minister’s involvement in crime.

FURTHER DETAILS OF THE PODCAST

“Who Killed Daphne?,” written and hosted by Reuters reporter Stephen Grey, is a six-part podcast that follows the struggle for justice by Daphne Caruana Galizia’s son Matthew after her death – and the project to continue Daphne’s work by a team of journalists. Produced by global podcast studio Wondery, it airs on Amazon Music, Apple Podcasts, Spotify and all other podcast platforms from July 11, or is available now on Wondery+.

((reporting by Stephen Grey; additional reporting by Jacob Borg of the Times of Malta; edited by Janet McBride))

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World

‘Message to the world’ – Lithuanians club together to buy drone for Ukraine

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VILNIUS, May 28 (Reuters) – Hundreds of Lithuanians are clubbing together to buy an advanced military drone for Ukraine in its war against Russia, in a show of solidarity with a fellow country formerly under Moscow’s rule.

Some 4.4 million euros ($4.1 million) have been raised in just three days – out of the 5 million euros needed – largely in small amounts, according to Laisves TV, a Lithuanian internet broadcaster that launched the drive.

“Before this war started, none of us thought that we would be buying guns. But it’s a normal thing now. Something must be done for the world to get better,” said Agne Belickaite, 32, who sent 100 euros as soon as the fundraising launched on Wednesday.

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“I’ve been donating to buy guns for Ukraine for a while now. And will do so until the victory,” she told Reuters, adding she was motivated in part by fears Russia could attack Lithuania.

The drone has proven effective in recent years against Russian forces and their allies in conflicts in Syria and Libya, and its purchase is being orchestrated by Lithuania’s Ministry of Defence, which told Reuters it planned to sign a letter of intent to buy the craft from Turkey next week.

Agne Belickaite poses next to graffiti that reads, “Russian warship, go fuck yourself!”, after donating 100 euro to purchase a military drone for Ukraine, in Vilnius, Lithuania, May 27, 2022. Picture taken May 27, 2022. REUTERS/Andrius Sytas

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Ukraine has bought more than 20 Bayraktar TB2 armed drones from Turkish company Baykar in recent years and ordered a further 16 on Jan. 27. That batch was delivered in early March.

“This is the first case in history when ordinary people raise money to buy something like a Bayraktar. It is unprecedented, it is unbelievable,” Beshta Petro, Ukraine’s ambassador to Lithuania, told Laisves TV.

Most of the heavy weapons that NATO countries have sent to Ukraine so far are Soviet-built arms still in the inventories of eastern European NATO member states, but some have recently started to supply Western howitzers.

“While governments of the world’s largest countries are endlessly deliberating … Lithuanian society simply comes together and, you know, is about to fundraise 5 million euros and buy the drone – which is an impressive message to the world,” said Belickaite.

($1 = 0.9328 euros)

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Reporting by Andrius Sytas in Vilnius
Editing by Mark Potter and Christina Fincher

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World

Biden, on inaugural Asia visit, says he would be willing to use force to defend Taiwan

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  • White House official says no change in policy
  • China says U.S. should not defend Taiwan independence
  • U.S. wants to toughen policy without provoking Beijing – analyst
  • Biden in Japan for first Asia trip of presidency

TOKYO, May 23 (Reuters) – U.S. President Joe Biden said on Monday he would be willing to use force to defend Taiwan, capping a series of critical comments about China while in Asia that an aide said represented no change in U.S. policy toward the self-ruled island.

Biden’s remarks, made during his first visit to Japan since taking office, and as Japanese Prime Minister Fumio Kishida looked on, appeared to be a departure from existing U.S. policy of so-called strategic ambiguity on Taiwan.

China considers the democratic island its territory, under its “one China” policy, and says it is the most sensitive and important issue in its relationship with Washington.

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When a reporter asked Biden during a joint news conference with the Japanese leader if the United States would defend Taiwan if it were attacked, the president answered: “Yes”.

“That’s the commitment we made,” he said.

“We agree with a one-China policy. We’ve signed on to it and all the intended agreements made from there. But the idea that, that it can be taken by force, just taken by force, is just not, is just not appropriate.”

Biden added it was his expectation that such an event would not happen or be attempted.

A White House official later said there was no change in policy towards Taiwan. China expressed its “strong dissatisfaction with and resolution opposition to the remarks”, a spokesman for it foreign ministry said.

Taiwan’s foreign ministry thanked Biden for his support.

Biden’s national security aides shifted in their seats and appeared to be studying Biden closely as he responded to the question on Taiwan. Several looked down as he made what appeared to be an unambiguous commitment to Taiwan’s defence.

Biden made a similar comment about defending Taiwan in October. At that time, a White House spokesperson said Biden was not announcing any change in U.S. policy and one analyst referred to the comment as a “gaffe”. read more

Despite the White House insistence that Monday’s comments did not represent a change of U.S. policy, Grant Newsham, a retired U.S. Marine Corps colonel and now a research fellow at the Japan Forum for Strategic Studies, said the meaning was clear.

U.S. President Joe Biden and Japan Prime Minister Fumio Kishida attend a press conference at Akasaka guest house, in Tokyo, Japan, May 23, 2022. Nicolas Datiche/Pool via REUTERS

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“This statement deserves to be taken seriously,” Newsham said. “It is a clear enough statement that the U.S. will not sit by if China attacks Taiwan.”

While Washington is required by law to provide Taiwan with the means to defend itself, it has long followed a policy of “strategic ambiguity” on whether it would intervene militarily to protect Taiwan in the event of a Chinese attack.

‘TOUGHEN THE POLICY’

Biden made other tough comments about Beijing’s increasingly assertive posture in the region, saying he hoped Russian President Vladimir Putin would pay a price for his invasion of Ukraine in part to show China what it would face if it were to invade Taiwan.

“They’re seeking to toughen their policy but without necessarily provoking China,” said James Brown, an associate professor at Temple University Japan.

Biden’s remarks are also likely to overshadow the centrepiece of his Japan visit, the launch of an Indo-Pacific Economic Framework, a broad plan providing an economic pillar for U.S. engagement with Asia. read more

During his time in Tokyo, Biden is also scheduled to meet the leaders of India and Australia – the other members of the Quad, an informal security grouping formed to counter China’s growing influence in the Indo-Pacific region.

Japanese premier Kishida emphasised Tokyo’s readiness to take a more robust defence posture, something the United States has long welcomed.

Kishida said he told Biden that Japan would consider various options to boost its defence capabilities, including the ability to retaliate. That would include a “considerable increase” in its defence budget, Kishida said.

Japan’s role in any conflict over Taiwan would be to enable a U.S. operation and help the United States defend its assets, said Yoji Koda, a retired Maritime Self Defense Force admiral and former fleet commander.

“Japan’s role in that would be substantial. Japan is an enabler of that security deterrence,” he said.

Kishida said that he had gained support from Biden on Japan’s becoming a permanent member of the U.N. Security Council amid growing calls for reform of the council. China and Russia are permanent members.

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Reporting by Trevor Hunnicutt; Additional reporting by Kiyoshi Takenaka, Sakura Murakami, Chang-Ran Kim, Nobuhiro Kubo, Daniel Leussink, Kantaro Komiya, Ju-min Park, and Tim Kelly; Writing by Elaine Lies and David Dolan; Editing by Robert Birsel & Simon Cameron-Moore

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World

Tunisia, others seek to limit damage after ship sinks carrying fuel

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TUNIS, April 17 (Reuters) – Tunisia will work with other countries that have offered to help it to prevent environmental damage after a merchant ship carrying up to one thousand tonnes of oil sank in Tunisian waters, the defence ministry said on Sunday.

The ship was heading from Equatorial Guinea to Malta when it sank seven miles off the coast of the southern city of Gabes on Friday. The Tunisian navy rescued all seven crew members following a distress call. read more

It was carrying between 750 tonnes and one thousand tonnes of fuel, officials said.

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The defence ministry did not name the countries that had offered to help, but local media said Italy was expected to send a naval vessel specialised in dealing with marine disasters.

A specialised marine diving team has begun work around the ship to check for any oil leakage.

The merchant fuel ship which sank off the coast of Gabes in Tunisia on April 15, 2022 is seen this handout picture taken in Rostov-on-Don, Russia November 12, 2017. Dmitry Frolov/Handout via REUTERS

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“The situation is reassuring and under control, and no leakage of gasoil has been recorded until now from the tank of the sinking ship,” Rabie Majidi the transport minister said.

He said the next stage was “delicate and sensitive” as the ship must be taken out of the water without allowing leakage.

On Saturday, Tunisian authorities opened an investigation into the sinking, which the environment ministry said was caused by bad weather.

“Tunisia will determine later the losses and will demand compensation,” Laila Chikaoui, the environment minister said.

The ministry said barriers would be set up to limit the spread of the fuel.

The coast of Gabes has suffered major pollution for years, with environmental organisations saying industrial plants in the area have been dumping waste directly into the sea.

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Reporting By Tarek Amara; Editing by Muralikumar Anantharaman and Barbara Lewis

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World

Pope kisses Ukrainian flag, condemns ‘the massacre of Bucha’

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VATICAN CITY, April 6 (Reuters) – Pope Francis on Wednesday condemned “the massacre of Bucha” and kissed a Ukrainian flag sent from the town where tied bodies shot at close range littered the streets after Russian troops withdrew and bodies poked out of a mass grave at a church.

The deaths in Bucha, outside Kyiv, have triggered a global outcry and pledges of further sanctions against Moscow from the West.

“Recent news from the war in Ukraine, instead of bringing relief and hope, brought new atrocities, such as the massacre of Bucha,” Francis said at the end of his weekly audience in the Vatican’s auditorium.

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“Stop this war! Let the weapons fall silent! Stop sowing death and destruction,” he said, decrying cruelty against civilians, defenceless women and children.

The Kremlin says allegations Russian forces committed war crimes by executing civilians including in Bucha were a “monstrous forgery” aimed at denigrating the Russian army.

Francis said the darkened and stained flag, which had writing and symbols on it was brought to him from Bucha on Tuesday.

Pope Francis holds the Ukrainian flag that was sent to him from the town of Bucha where tied bodies were shot at close range, a mass grave and other signs of executions were found, during the weekly general audience at the Paul VI Hall at the Vatican, April 6, 2022. REUTERS/Remo Casilli


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“It comes from the war, precisely from that martyred city, Bucha,” he said, kissing it and holding it up for the audience of several thousand, which broke into applause.

He then asked a group of children war refugees who arrived on Tuesday from Ukraine to come up to him.

“These children had to flee in order to arrive in a safe land. This is the fruit of war. Let’s not forget them and let’s not forget the Ukrainian people,” he said, before giving each child a gift of a chocolate Easter egg.

Speaking in the earlier part of his audience about the post-World War Two period, Francis said: “In the war in Ukraine, we are witnessing the impotency of the United Nations”.

During a trip to Malta at the weekend, Francis said he was considering a trip to Kyiv and implicitly criticised Russian President Vladimir Putin over the invasion of Ukraine, saying a “potentate” was fomenting conflict for nationalist interests. read more

Francis has only mentioned Russia specifically in prayers, such as during a special global event for peace on March 25, but he has referred to Russia by using terms such as invasion and aggression.

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Reporting by Philip Pullella; Editing by Hugh Lawson

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Business

U.S. gasoline prices soar to highest since 2008 on Russia conflict, AAA says

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Traffic travels past a sign displaying current gas prices in San Diego, California, U.S., February 28, 2022. REUTERS/Mike Blake

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March 6 (Reuters) – U.S. gasoline prices jumped 11% over the past week to the highest since 2008 as global sanctions cripple Russia’s ability to export crude oil after its invasion of Ukraine, automobile club AAA said on Sunday.

AAA said average U.S. regular grade gasoline prices hit $4.009 per gallon on Sunday, up 11% from $3.604 a week ago and up 45% from $2.760 a year ago.

AAA said that was the highest average for regular grade gasoline since July of 2008, when U.S. crude futures soared to a record $147.27 a barrel.

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The most expensive gas in the country is in California at $5.288 a gallon, followed by Hawaii ($4.695), Nevada ($4.526) and Oregon ($4.466), according to AAA.

Gasoline price provider GasBuddy said the average price of U.S. gasoline spiked nearly 41 cents per gallon, topping $4 for the first time in almost 14 years, and stands just 10 cents below the all-time record of $4.103 per gallon.

GasBuddy said that weekly increase was the second largest ever, following a jump of 49 cents per gallon during the week of Sept. 3, 2005, after Hurricane Katrina tore through the U.S. Gulf Coast.

Total domestic gasoline stocks decreased by almost 500,000 barrels to 246 million barrels during the week ended Feb. 25, while gasoline demand increased from 8.66 million barrels per day (bpd) to 8.74 million bpd, according to the latest weekly data from the U.S. Energy Information Administration (EIA).

“An increase in gas demand, alongside a reduction in total supply, is contributing to price increases, but increasing oil prices continue to play a leading role in pushing prices higher,” AAA said in a release, adding that, “pump prices will likely continue to rise as crude prices continue to climb.”

U.S. crude futures gained 26% last week to settle at $115.68, their highest close since September 2008. read more

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Reporting by Scott DiSavino
Editing by Bill Berkrot

Our Standards: The Thomson Reuters Trust Principles.

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