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African Leaders named in US Money Laundering Case

Source: Thisdayonline.com


Mrs Jennifer Douglas, fourth wife of former Vice-President Atiku Abubakar, was yesterday reported by a US Senate Permanent Subcommittee on Investigations to have brought in over $40 million in suspect funds into the US through wire transfers sent by offshore corporations to US bank accounts.

In a 2008 civil complaint, the US Securities and Exchange Commission alleged that Douglas, a US citizen, received over $2 million in bribe payments in 2001 and 2002, from Siemens AG, a German engineering and communications company, which has already pleaded guilty but Atiku's wife has denied any wrongdoing.

The report of the committee also revealed that foreign dictators, high-living bureaucrats and arms dealers are still able to funnel millions of dollars in potentially corrupt money into the US despite post-September 11 laws cracking down on money laundering.

The son of the president of Equatorial Guinea was said to have moved $110 million in suspect funds into the US from 2004 to 2008 while an Angolan arms dealer, now in a French jail, was able to pay $9.6 million for an Arizona home in 2000 and maintained US bank accounts handling some $60 million in transactions between 1999 and 2007.

The report said: “Of the $40 million in suspect funds, $25 million was wire transferred by offshore corporations into more than 30 U.S. bank accounts opened by Ms. Douglas, primarily by Guernsey Trust Company Nigeria Ltd., LetsGo Ltd. Inc., and Sima Holding Ltd. The U.S. banks maintaining those accounts were, at times, unaware of her PEP status, and they allowed multiple, large offshore wire transfers into her accounts.

“As each bank began to question the offshore wire transfers, Ms. Douglas indicated that all of the funds came from her husband and professed little familiarity with the offshore corporations actually sending her money. When one bank closed her account due to the offshore wire transfers, her lawyer helped convince other banks to provide a new account.

“In addition, two of the offshore corporations wire transferred about $14 million over five years to American University in Washington, D.C., to pay for consulting services related to the development of a Nigerian university founded by Mr. Abubakar. American University accepted the wire transfers without asking about the identity of the offshore corporations or the source of their funds, because under current law, the University had no legal obligation to inquire.”

Meanwhile, Atiku Media Office has denied all the allegations against the former Vice-President.

It said the report contains allegations that have been recycled over the past few years by political opponents with the intention of damaging Atiku's reputation and truncating his political career.

It also said it is true that over the past eight years, the Abubakars have transferred some funds from their Blind Trust to pay for consulting services to the American University in Washington, DC, faculty and staff salaries of American University of Nigeria, Yola and for the upkeep of his family in the United States.

The Blind Trust was set up in 1999 to manage Abubakar's business interests in a bid to avoid any conflict of interest as a public officer, it said.

“The funds transferred are legitimate earnings of Abubakar from his shares in INTELS, a well known oil services company co-founded by the former Vice-President since the 1980s,” the statement said. “According to the records kept by his office, the former Vice-President made his first contact with Siemens officials while in office by the middle of 2002. But Siemens claim that they made payments to a "Vice-President of Nigeria" between December 2001 and January 2001. This, to say the least, is confusing and outrightly untenable.”

The subcommittee chairman, Senator Carl Levin, D-Mich., said that while banks are doing better in blocking dirty money because of anti-money laundering safeguards in the 2001 Patriot Act, there are still “so many vehicles in our system where corrupt money can flow”.

The findings of the report, which focused on four case studies, are “infuriating”, he said.

The 330-page report concluded that powerful foreign officials and their families, known internationally as “politically exposed persons” (PEPs), have used lawyers, real estate and escrow agents, lobbyists, bankers and university officials to circumvent anti-corruption laws.

It noted that the Treasury Department exempted some industries, such as hedge funds and the real estate industry, from Patriot Act anti-money laundering requirements, and that many of the professionals examined were under no legal obligation to take anti-money laundering precautions when dealing with a PEP.

The report recommended that Treasury adopt recent World Bank proposals to strengthen bank controls related to PEPs and repeal Patriot Act exemptions for setting up anti-money laundering programmes. Congress should require that the owners of shell corporations be named, according to the report, and should make acts of foreign corruption a legal basis for denying U.S. entry to the person involved in the corruption and his family.

A Levin aide said one possibility was attaching anti-money laundering provisions to pending legislation to increase oversight of financial institutions.