1/ This morning the Shell/ Eni trial is continuing in Milan. We're expecting a busy day with witnesses including a British solicitor who allegedly received a bag of cash from a Nigerian politician, a manager from European bank Raiffeisen & two expert witnesses for Shell and Eni. 
2/ The first witness is expected to be Jeffrey Tesler, a British solicitor convicted of paying bribes for the TSKJ consortium (which included an Eni subsidiary) in Nigeria in the Bonny Island scandal. He also acted as Dan Etete's legal advisor at times.
3/ We expect Tesler will be giving evidence about an extraordinary episode where he was handed a suitcase of cash in a London hotel by a Nigerian politician. Tesler reported the incident to London's Metropolitan police prompting a sting operation, arrests and cash seizures.
4/ Eni and their CEO Descalzi (also a defendant in the trial) filed papers last night to withdraw their witness, the banker from Raiffeisen. A very last minute change of strategy. Prosecutors and Nigeria's lawyers will have an opportunity to oppose this.
5/ Eni's expert witness Professor Pietro Manzonetto together with an assistant will give evidence first. He is senior accountant and academic as well as being on the oversight boards of several companies and is a specialist in corporate responsibility.
6/ Manzonetto was commissioned by Eni to assess their system of corporate administration and governance (called model 231) and their ethical code of conduct. The system lays down their procedures for all their operations.
7/ Manzonetto says that his analysis of Eni's systems on paper were that they were adequate and compliant with the law to avoid corporate responsibility in the case of the crimes they are accused of.
8/ Manzonetto explains how he also looked at the implementation of Eni's processes at key moments of the OPL 245 deal.
9/ Manzonetto is asked what are the problematic issues Eni had to deal with in the OPL 245 deal, he starts with a long explanation of process in assessing the required profit margin needed to make an investment and saying that this was frequently considered by the company.
10/ Manzonetto is then asked about the anti-bribery processes specifically. He says they were followed but the due diligence found identifying those behind Malabu impossible. Completing the due diligence was always a condition to be able to complete any deal directly with Malabu.
11/ Manzonetto explains that when the deal changed to a transaction with Shell & the Nigerian Government, no due diligence was needed on Shell as they are already partnered elsewhere. He says Eni required no due diligence on democratically elected governments and their officials.
12/ Manzonetto concludes saying that while Eni's procedures are complex and at times inefficient, they were followed.
13/ The public prosecutor takes over questioning. Manzonetto explains that due diligence is meant to identify the public profile of who you are dealing with. To identify and manage the risk but wrongdoing can't be entirely prevented.
14/ Manzonetto is pressed on the role of Dan Etete in Malabu. He says the briefings to the Eni CEO didn't mention him, and there was no evidence Etete was a shareholder only the risk which Eni identified as a reputational risk.
15/ Manzonetto says Eni never concluded a deal with Malabu. The payment was to the government, of course they knew that money was needed to close the previous disputes but their procedures don't deal with third parties.
16/ Manzonetto is asked if Eni's due diligence did prove Etete was a Malabu shareholder would that be a problem? He says that Eni's procedure just says they just do due diligence to find out about their counterparty and assess their reputation not whether or not to do the deal.
17/ The prosecutor asks If the ultimate aim on the anti-corruption approach is to find out where the money ends up why didn’t the checks on Malabu need to be finished?
It was because of all the problems identified that the deal was not completed with Malabu, Manzonetto responds.
It was because of all the problems identified that the deal was not completed with Malabu, Manzonetto responds.
18/ Manzonetto says Eni's anti-corruption unit did in fact know that Malabu would be an ultimate recipient of money from the deal, the prosecutor pointed out that Eni's anti-corruption manager had denied knowing Malabu would be the ultimate beneficiary when he gave evidence.
19/ Manzonetta is asked whether it is a problem that Eni's Descalzi was meeting a middleman, Obi, even after the negotiation was supposedly with the govt. He didn't know about this but its irrelevant as govt is the counterparty then, the processes don't include third parties.
20/ Manzonetto is asked if Eni's anti-corruption unit knew who the physical person was who was accepting Eni's offer of $1.1bn in November 2010 meetings in Abuja with the FGN Attorney General. He says there is no evidence they knew who the seller exactly was.
21/ Manzonetto acknowledges that Eni did identify a red flag with Etete, the lack of documentation on Malabu and that there was a risk of corruption. He says that they could investigate further and it would be for decision makers to conclude whether the risk was too high.
22/ Nigeria's lawyer asks what the procedure says when the counterparty is the government but other agreements are signed with other parties, like Malabu? Manzonetto replies that the procedure is one for joint ventures and that only applied to checking Shell and maybe Nigeria.
23/ Manzonetto's testimony is finished and now we're going to hear from Shell's expert witness on corporate responsibility and compliance Homer Moyer, a senior partner at the US law firm Miller and Chevalier.
24/ Moyer was asked to review Shell's compliance programme and determine whether it was in line with best practice at the time of the 2011 deal. Shell declines to ask clarifying questions so the prosecutor says they will ask a handful of questions.
25/ Moyer is asked about the Deferred Prosecution Agreement (DPA) that Shell signed in 2010 with US authorities. He explains the case was a Shell contractor which paid bribes to Nigerian customs officers. There were remedial requirements put in place in the agreement with DOJ.
26/ Moyer is shown a Shell email: "This letter [is] clearly an attempt to deliver significant revenues to GLJ [Goodluck Jonathan] as part of any transaction.". He says that Jonathan was receiving money personally then there would be a corruption risk for whoever was paying him.
27/ Moyer says the Shell emails he's was suggests internal corruption inside the govt of Nigeria but says that companies aren't responsible for officials stealing. He says if that was a corruption risk then it would be impossible to do business with governments all over the world
28/ Moyer is told that Etete or Malabu would be paid $1.1bn by the Nigerian government as a result of the Shell deal. He says that Shell would not have to do due diligence on Malabu or Etete unless Shell was planning to go into a partnership or joint venture with Malabu.
29/ Moyer is asked if he saw a Shell internal audit from the Integrity department about OPL 245 found in the raid of the company, he says no. He says he didn't investigate the deal.
30/ Moyer is asked whether he was only to review the effectiveness of Shell's compliance programme regardless of the transaction being in discussed in court today.
He answers yes just the effectiveness of the compliance programme.
He answers yes just the effectiveness of the compliance programme.
31/ No further questions for Moyer. It seems that Jeffrey Tesler, the British lawyer will not be giving evidence today as Israeli authorities couldn't summon him this week. The prosecutor asks that Tesler's statement to police is included as evidence for now, only Etete objects.
32/ The prosecutor confirms that they filed an indictment against Aliyu Abubakar in a related case to the main Shell/ Eni trial. Aliyu Abubakar was alleged in the main trial's indictment to have distributed $520m in cash from the OPL 245 deal to Nigerian public officials.
33/ The next hearing is scheduled for Wednesday next week when we're expecting to hear from a senior Lagos police officer who allegedly saw cash payments being made in Nigeria. In the meantime check out our other reporting on the case at globalwitness.org/en/campaigns/o…
