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Egypt's billions are looted

January 25, 2014 at 3:11 am

Researchers from the BBC spent six months on the trail of the money looted from Egypt; on the day that the resultant documentary was broadcast, the Guardian newspaper published an investigation into its findings. Combined, the BBC and Guardian exposés were revealing: the leaders of six Arab states looted about $300 billion of their respective countries’ wealth over the past forty years. The countries in question are Egypt, Iraq (under Saddam Hussein), Tunisia, Libya, Yemen and Syria. If invested wisely, the looted funds could have grown into more than a trillion dollars.

World Bank experts have estimated the amount of money looted from Egypt during the Mubarak era at about $134 billion, including $54 billion in the last eight years alone. The BBC puts the estimate at less than $1 billion, including $700 million francs in Swiss banks. Whatever the figure is, the money has not yet been returned to the Egyptian treasury, a process which could take up to ten years to complete.

The Swiss government froze Mubarak’s assets half an hour after he stepped down; Britain took 37 days to take that step, and turned a blind eye to financial activity of the Mubarak family and aides which should have been the subject of a freezing order. According to Dr. Mohammed Mahsoob, a prominent member of the legal group formed to recover the stolen funds (and now Egypt’s Minister of State for Legal Affairs) Britain was the worst culprit guilty of procrastination on this issue.

In the first six months of the revolution in Egypt, the BBC found that Mubarak’s sons and associates used Arab banks in London, a myriad of companies and money laundering in Panama, the Cayman Islands, Cyprus and Gibraltar, as well Dubai, to distribute looted funds.

This embezzlement on a grand scale was well organised; Mubarak used two private banks offshore to transfer money out of Egypt. One of the banks was still active until 22 March 2012, thirteen months after the revolution; it is now controlled by the Central Bank of Egypt.

The BBC pointed out that a presidential decree issued in 2004 identified the role of the Central Bank in the control of offshore banks, including the two banks in question. The president had the right to appoint the Central Bank governor and the chairs of the boards of directors of the banks, including offshore banks. It also said that some of the bankers who helped in the smuggling and money laundering are still in decision-making positions.

While Britain froze assets worth £85 million controlled by Mubarak, his wife and his two sons, as well as 15 aides, the BBC’s investigations showed that some property and assets were not included; luxury homes in Chelsea and Knightsbridge, for example. One such house in Wilton Place, lived in by Gamal Mubarak for several years, is valued at between 8 and 10 million pounds.

The extravagant lifestyle of the Mubaraks was illustrated by the revelation that the President’s wife, Suzanne Mubarak, stayed in the Royal Suite at the Four Seasons Hotel, Geneva, at a cost of $15,000 per night. That’s more than 90,000 Egyptian pounds.

I have two comments on the documentary which exposed the ugly face of the former regime, namely:

1) That the BBC deserves thanks and appreciation for the effort made by its investigative journalists for six months to complete this important documentary, which should have been commissioned by Egyptian satellite channels.

2) That an inquiry into the Egyptian banking channels through which the smuggling of those billions was done is yet to be opened, not least because the people who were involved in the smuggling operation are still in their positions today.

The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Monitor.