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Reports: UAE ambassador embroiled in global corruption scandal

August 3, 2017 at 2:21 pm

Ambassador of the UAE in Washington, Yousef Al-Otaiba [U.S. Army Staff Sgt Sun L. Vega/Wikipedia]

Yousef Al-Otaiba, the UAE’s ambassador to the United States, is alleged to be involved in a major global corruption scandal.

Leaked emails show a long-term relationship between Al-Otaiba and Jho Low, a Malaysian financier who law enforcement officials accuse of embezzling $4.5 billion from the Malaysian 1MDB investment fund.

The revelation of this relationship led to a new investigation carried out by US, Swiss and Singaporean authorities. Hacked emails show that Al-Otaiba and his Jordanian business partner Shaher Awartani discussed inquiries made by the investigating countries about transactions they received from companies linked to Mr. Low.

In one of these emails Awartani suggested that Al-Otaiba should buy a Ferrari, but the UAE ambassador replies that he would rather not drive one in the streets of Abu Dhabi.

The GlobalLeaks hacker group, which disclosed the emails to The Wall Street Journal, has refused to identify its members or how it obtained the messages. GlobalLeaks declared in a statement yesterday that it wanted “to expose corruption and financial fraud committed by rich governments”.

Read: Hackers leak emails from UAE ambassador to US

The Wall Street Journal reported in June that companies connected to Al-Otaiba had received $66 million from offshore accounts containing money allegedly embezzled from Malaysia’s 1MDB investment fund.

For years Al-Otaiba has been a key public figure in the United States and enjoyed extensive relations with diplomats and officials in Washington, who often lunch with him and attend the VIP gatherings he holds at his house.

The emails highlight Al-Otaiba’s vast wealth, which includes millions of dollars of shares in Palantir, a data analysis firm that has contracts with the US intelligence, law enforcement community, and The Carlyle Group.

Al-Otaiba frequently gives advice to President Donald Trump’s son-in-law and counsellor, Jared Kushner, about Middle East policy. He also urged the Trump administration to support the UAE, Saudi Arabia and other countries in the Middle East in their efforts to isolate Qatar, which they have accused of supporting Islamic terrorist groups such as Al-Qaeda. Qatar maintains that it does not sponsor terrorism.

Read: UAE welcomes Qatari decision to amend anti-terrorism laws

In July Al-Otaiba issued a statement denying media reports that the UAE was involved in a scheme to infiltrate Qatari government websites and post fake quotations and attribute them to the Prince of Qatar.

The UAE embassy in Washington has refused to comment on the leaked emails and acknowledged that the ambassador has special business interests but that they have nothing to do with his diplomatic role.

People who are close to the investigations conducted by the government in Switzerland, Singapore and the United States declared that officials were looking into transfers to companies owned by Al-Otaiba and Awartani and whether they had bought assets from the investment fund.

Al-Otaiba used his diplomatic influence to persuade a number of banks to give loans, saying that it was crucial for the UAE-Malaysia relationship.

In September 2014 Al-Otaiba encouraged a number of banks in Abu Dhabi to participate in a short-term refinancing loan arranged by Deutsche Bank for the benefit of the Malaysian investment fund.

The Ministry of Justice has recently declared that $700 million has been embezzled out of the Deutsche Bank loan. This money was used by Mr. Low to buy jewelry for his former girlfriend, the Australian model Miranda Kerr.

Part of the investigation in Singapore has shown that $3 million was paid to a company in the British Virgin Islands controlled by Al-Otaiba and Awartani. Another $13 million was paid to the same company two months later. The Ministry of Justice stated that both sets of funds had been embezzled from the Malaysian 1MDB investment fund, including from the Deutsche Bank loan.

Another email, which dates back to December 2009, reveals Al-Otaiba urging Thomas Barrack Junior, a billionaire from California, to accept an offer by a hotel managing company that is partly owned by Mr. Low’s family to buy L’Ermitage Hotel in Beverly Hills, owned by Colony Capital Management.

Low’s private investment firm eventually bought the hotel in 2010 for more than $45 million. The Ministry of Justice has filed charges of civil property and is seeking to seize the hotel, claiming that it was purchased with money stolen from the Malaysian 1MDB investment fund.

Barrack said that Al-Otaiba was a friend, and that the winning bid for the hotel was the highest.

The audits on Al-Otaiba’s accounts in the United States, Switzerland and Singapore were launched in 2015 when Lombard Odier, a private Swiss bank, begun to ask for more information on transfers to accounts controlled by Al-Otaiba and Awartani

Tobias Byster, a former Credit Suisse banker in Dubai, wrote to Al-Otaiba in an email: “Mr. Low is recommending Al-Otaiba and Awartani close their bank accounts and answer queries about accounts and payments in person, not via email.”

A few weeks later Al-Otaiba and Awartani closed their accounts and transferred money elsewhere, according to the leaked emails that showed the request and its confirmation as well.

“We need to talk about the still unanswered questions. We want to co-ordinate,” wrote Mr. Low in an email from Saint Helena island in May to Mr. Awartani.