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Ben Sutherland;

Libya scrambles to find Gadhafi’s missing billions

Apart from the outcomes of the UN-brokered peace deal that was signed July 11, in Skhirat, Morocco, the fact that some parties to the conflict objected on its articles, and that others do not recognize some forces and figures that took part in it, negotiations are underway in Libya. These, for the first time, are taking place in secrecy, between representatives of the two governments to discuss the development of a plan to protect and restore Libyan assets, which were deposited around the world under the former regime era. The successive governments could not collect them, although their location is known; financial institutions and banks are investing and making profits out of them. 

According to intersecting information provided by officials in Tripoli’s unrecognized government, and the internationally recognized Tobruk government, competent international institutions were entrusted with the follow-up on the issue. At the same time, Abdul Majeed Breish, head of the Libyan Investment Authority (LIA), revealed that a temporary judicial receiver was appointed on LIA’s behalf to manage the legal actions against the US firm Goldman Sachs and the French bank Societe Generale.

In this context, a close associate to the Tobruk government, headed by Abdullah Al-Thani, said the issue will not stop here, because a political and popular consensus was reached between all parties to do whatever it takes to recover the funds that have been frozen abroad for false reasons and with suspicious objectives by foreign banks, financial institutions and brokers. He noted that the Libyan governments in the east and the west agreed to prepare to prosecute former and current heads of states who had encouraged the former regime to deposit funds and surplus oil revenues, and invest them in financial portfolios in their countries.

On purpose, the Libyans overseeing this issue leaked the name of former British Prime Minister Tony Blair, who served as financial adviser to the Libyan regime after economic sanctions were lifted, following the regime’s participation in the resolution of the Lockerbie case, in which Blair assumed a major role. The proof is that Blair was the first to visit Tripoli after the lifting of sanctions, and attended a ceremony to sign a number of agreements, including military deals, with Col. Moammar Gadhafi at the time.

In light of the decline in foreign currency in the coffers of the Central Bank of Libya to less than $100 billion in late April, the decline in oil production and therefore revenues — which are no longer enough to meet budget deficit — and the ongoing months of delay of public sector salaries, the restoration of what the Libyan street calls “the largest fraud in history” it says was committed by Western countries, banks and institutions has become a top priority.

This is added to the armed conflicts in the country and political disputes that have prevented the formation of a government in which everyone, with no exception, participates, except for the force representing directly or indirectly the armed Islamic militias. At the same time, those who are entrusted [with the follow up] are demanding that the truth, size and place of the funds of Gadhafi’s family and regime figures be revealed — which so far no one has succeeded to thoroughly determine, contrary to the state funds and various investment funds.

Remarkably, for the first time, the Libyan society is taking serious steps to restore the looted assets, and therefore to hold accountable the post-revolution governments’ officials and those who are responsible for the looting of funds. The society is making agreements with some international institutions and banks, and remaining silent on the failure to collect the state and people funds and the new revenues. Society is doing so through the appointment of experts to competent global institutions and judicial receivers on Libyan society’s behalf in the prosecution, and the need to reach the funds that the Gadhafi family placed in accounts, real estate and investment portfolios in the names of its close relatives.

According to information from Tripoli, there is an intention to prepare for a general national conference to discuss this issue, as well as the steps that were taken so far and that are expected to be taken. Financial monitoring bodies have started to ask about the legal actions against global institutions that abused a number of investments, to the point of stealing some of them.

Moreover, other government bodies are trying to raise questions about the attempts by African countries to seize the Libyan investments they have in their country, such as Togo, which seeks to nationalize the Libyan company that bought the majority of its phosphate companies. The same applies to Mali and Niger.

The size of the investments, assets and deposits may be up to $300 billion. This is not counting the properties, accounts and investments of Col. Gadhafi’s family and some of the regime’s figures who are detained in Libya or are living abroad. The size of these properties could not be determined by those following up on the issue, despite the remarks of Mustafa Abdul Jalil and Ali Zeidan, who said that Gadhafi absconded with $287 billion — which is yet to be proved.

The important thing, according to a number of Libyan officials, is the presence of evidence and documents on the whereabouts of these resources, as well as the lists of banks, foreign countries and institutions that were reluctant to return the funds to Libya under various pretexts, namely the absence of unified lists. This is knowing that the Central Bank is unified and conducting the country’s finances.

In this context, an official spoke of the reports submitted by the Libyan Foreign Investment Company (LAFICO), which managed the investments for nearly 40 years, and whose assets reached $70 billion on the eve of the revolution. This is added to those provided by Libya Africa Investment Portfolio (LAP), the Oilinvest Group — which is based in Milano, Italy — and the Libyan Local Investment and Development Fund (LLIDF).

In the same context, sources believe that the competent Libyan authorities will begin the prosecution to recover the funds in mid-September, and recalled that companies such as Citigroup, Spanish Banco Santander, the Italian Eni Group and Électricité de France, will be among the groups that Libya intends to prosecute. The same applies to a number of financial brokers and investment firms that manage Libyan portfolios in Switzerland, particularly in Zurich, Britain, Italy and some Maghreb countries.


By Samir Sobh

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