One of the reasons why I for one am not so impressed by this “humanitarian” role of Nato in liberating Libya is simply because of the hypocrisy that underlines the current discourse around the frozen assets for the Gaddafi family.
Make no mistake, Gaddafi was a delusional dictator and at the centre of his heart lay a gigantic nothing. Yet that does not mean that anyone who opposed him did so for good reason.
Indeed, when one studies the matter closely, one realises how Gaddafi was heavily invested materially in the West and they knew the billions were suspect yet they assisted Gaddafi to use pseudo names and complex investment vehicles that have made it close to impossible to track down those assets.
Gaddafi is believed to have had around US$168 billion in assets abroad, most of which has been frozen since the start of the year. Is it not strange that the reason why those assets are going to be difficult to recover is not Libyan laws but laws of countries with the money?
They make it easier, infact super easy for dictators to invest and make it next to impossible for the victims and or the leaders of the “liberated countries” to repatriate that money!
The international financial system, apart from deliberately not coming up with a comprehensive legal framework to track down stolen assets, benefits immensely from the investments of fallen dictators.
A secret diplomatic cable released by WikiLeaks suggests that Libyan officials had spread around US$32 billion in assets to different US banks in US$300-US$500 million chunks. British media reports that Gaddafi owned 14 Cornhill, opposite the Bank of England, bought in December 2008 for £120 million and many other properties bought by his sons.
- Chamisa under fire over US$120K donation
- Mavhunga puts DeMbare into Chibuku quarterfinals
- Pension funds bet on Cabora Bassa oilfields
- Councils defy govt fire tender directive
Keep Reading
The World Bank has clear guidelines around “politically exposed persons” which stipulates that banks are supposed to carry out due diligence on accounts of top politicians, their families and close associates, especially those suspected to be corrupt.
Was there any doubt that Gaddafi could be corrupt? Or was there any due diligence taken to ascertain whether that money was earned through honest means or banks were just gladly accepting these massive deposits.
Akere Muna, vice-chairman of Transparency International famously remarked at the 2010 International Anti Corruption Conference in Bangkok, Thailand, about an experience with bankers in which they remarked that they actually lure these dictators to open accounts knowing fully well that those accounts would be frozen and that money would be available to the bank only!
Right now, countries like Switzerland, Germany and US do well on the famed Corruption Perception Index yet they are the havens not just of tax evaders but of some of the world’s leading dictators.
The NTC has been pleading for months to have that money back yet we are told it will take years! Victor Comras, a former money laundering expert for the United Nations and US State Department laments that Bankers managing assets for Gaddafi and his family might “act as if the assets belong to them,” particularly with those converted into personal holdings.
To aggravate matters, there is currently no single international legal regime or treaty setting procedures for tracing, recovering and repatriating assets misappropriated or abused by deposed regimes hence assets will have to be recovered country by country.
Consequently, uncertainty remains on what happens to the interest that accrues to these foreign dollars stashed in Western bank accounts. If money was frozen in the year 2000 and it remains frozen to this day, who is taking the interest?
International banks! Ever wondered why it is easier to push through a UN resolution to freeze assets yet the same UN Convention Against Corruption (UNCAC) is glaringly silent on what to do with these frozen assets? Was it an omission that UNCAC was silent on that or it was all a product of intense lobbying by international banks?
Surprisingly, as the NTC struggles to get the assets unfrozen in the US among a host of big nations, the US Treasury, in September quickly but partially lifted some Libya sanctions in order to open the door for US companies and individuals to do business with the Libyan National Oil Corporation and other companies in Libya, as long as the transactions don’t benefit anyone affiliated with the Gaddafi regime. One wonders what big Libyan company has absolutely no connection to the formerly all powerful and ubiquitous Gaddafi regime.
Would it be wild speculation if one argues that perhaps Libyan frozen money is the money US companies are borrowing so they can do business in Libya? The British Daily Mail reports some US lawmakers want to use frozen Libyan assets to reimburse Nato countries for military operations.
Others want to link frozen assets to Libyan cooperation with investigations into Gadhafi-era terrorist attacks, according to a Congressional Research Service report released September 29 most likely so as to forfeit the money altogether without Libyan approval. In other words, some folks want to cash-in before the Libyans themselves.
Back home, we already know that over a hundred officials on the sanctions list also had their assets frozen for years now. The question that has not been answered by international banks operating in big Western nations is what is happening to the interest being earned in those accounts.
We know that it is next to impossible for a 100% recovery rate of frozen assets which means banks will simply benefit from some of the money. We have been told that corruption is rampant in poor countries and less in the richer ones.
I don’t know if that is necessarily true. The oppressed in Africa are caught between the Scylla of repressive dictators at home and the charybdis of a hypocritical international political economy.
Yet it is clear that transnational corruption continues unabated. A modified UNCAC that takes into cognizance the current difficulties in recovery of stolen assets is urgent and imperative.
l Due to circumstances beyond our control, the Editor’s Memo could not be published today.
