Malta journalist murder: Two senior government officials resign after businessman arrested on yacht

Resignations come as police say investigation making ‘big advances’

Journalist Daphne Caruana Galizia was killed in a car bomb in October 2017 (AP)

Two government officials in Malta have resigned in an escalating scandal over the 2017 murder of journalist Daphne Caruana Galizia.

Chief of staff Keith Schembri resigned because of his alleged financial ties to businessman Yorgen Fenech, who was detained last week as a person of interest in the police investigation into the murder.

Later on Tuesday, tourism minister Konrad Mizzi announced his resignation but denied any involvement in the case which has rocked the island nation.

A third official, economy minister Christian Cardona, suspended himself from his government role denying that he has any connection with the case, citing instead “the national interest”.

Mr Schembri had been facing pressure to resign over his alleged links to Mr Fenech.

The alleged murder plot middleman Melvin Theuma was granted a presidential pardon on Monday in return for information he had given about the case.

“What is happening now, and what happened last week is an operation that is hopefully solving the Daphne Caruana Galizia murder,” Joseph Muscat, the prime minister told Reuters on Tuesday. “Whatever people might say, there is no impunity in this country.”

Ms Caruana Galizia, one of Malta's best-known investigative journalists, was blown up as she left her home on 16 October 2017 in a murder that shocked Europe and raised questions about rule of law on the small Mediterranean island.

Three men are awaiting trial for setting off the bomb and police sources say the investigation into who actually ordered the killing has made big advances in the past week.

A Reuters investigation last year revealed that Mr Fenech was the owner of a secret company called 17 Black, which was named in emails as being the vehicle to fund secret Panama companies owned by Mr Schembri and tourism minister Mr Mizzi.

It is not known whether any funds actually changed hands. Mr Schembri and Mr Mizzi have always denied wrongdoing and Mr Muscat has repeatedly resisted calls for their dismissal.

Opposition politicians have denounced Mr Muscat for allowing the two men to stay at their posts and have called on him to step down. But the prime minister said he had no intention of resigning at present.

“My role right now is to ensure the country has stable leadership. My role is to make sure we navigate through this turbulent time,” he told Reuters.

Caruana Galizia regularly posted allegations of corruption on her blog and on various occasions targeted members of the Muscat government, including Mr Schembri.

She mentioned 17 Black in one post before her death, but wrote that she did not know who owned it.

Agencies contributed to this report