- Development & Aid
- Economy & Trade
- Human Rights
- Global Governance
- Civil Society
Thursday, August 18, 2022
CAIRO, Feb 19 2011 (IPS) - As Egypt’s popular uprising gained momentum and Hosni Mubarak’s downfall looked increasingly inevitable, he used his final days in office to secure his vast wealth, say analysts.
Mubarak, or the Pharaoh as he has come to be called, allegedly amassed billions of dollars during his 30 years in power through illicit dealings. His undisclosed fortune is believed to be tied up in foreign bank accounts, corporate partnerships, gold bullion and real estate.
Egypt’s military removed the 82-year-old dictator from power on Feb. 11 after 18 days of massive anti-government protests that shook the populous Arab country. He is now reportedly confined to his gated villa in the Red Sea resort of Sharm El-Sheikh, though some rumours suggest he may have fled the country.
Anti-corruption expert Ahmed Sakr Ashour, professor of business administration at Alexandria University, says Mubarak undoubtedly used his last days in power to cover his money trail. Sources close to the deposed ruler’s family have spoken of urgent phone calls to financial advisers and efforts to transfer assets into hidden offshore accounts.
“Investigators have to move quickly,” Ashour told IPS. “Even now, Mubarak and the corrupt people in his regime are trying to get their house in order and to hide the evidence.”
Mubarak, a former air force commander, came from a relatively modest background. Some analysts suspect he enriched himself on military contracts while still in the armed forces, but it was after becoming president in 1981 that his wealth began to grow exponentially.
“Alaa and Gamal were silent partners in hundreds of large businesses,” says a Cairo-based financial expert. “For every lucrative deal, they took a cut.”
Mubarak owns several palaces and villas in Egypt; some he inherited from previous rulers, others he had built. His family also owns airplanes, yachts, and a fleet of cars.
The deposed dictator’s overseas holdings are veiled in secrecy, but he is known to bank discreetly in Switzerland, Britain and the United States. The family is also reported to own properties in Dubai, London, Paris, Washington, New York and Beverly Hills.
Estimates of the Mubarak family’s total wealth range from a billion dollars to a high of 70 billion. More than 20 percent of Egypt’s 82 million live on less than two dollars per day.
“Tell Mubarak we want our 70 billion dollars back,” read one protester’s placard on the night that the president resigned.
Egyptian prosecutors have opened corruption investigations into over a dozen former ministers and influential businessmen. Conspicuously, no investigation has been launched into the assets of Hosni Mubarak and his family.
It could be a frustrating search, warns Tom Cardamone, managing director of Global Financial Integrity, a Washington-based corruption watchdog.
He told IPS that dictators such as Mubarak usually conceal their wealth in so- called secrecy jurisdictions, countries with opaque banking systems that encourage and facilitate illicit financial flows. Switzerland is a prime example, but there are some 70 countries around the world believed to be holding over 10 trillion dollars in non-resident financial deposits.
Illicit funds are often hidden in an intricate web of shell companies, fake foundations and anonymous trust accounts spread across several secrecy jurisdictions to make them nearly impossible to track. Investigators would need access to each entity in each secrecy jurisdiction in order to trace the funds back to their source.
“A classic way is to create entities in different jurisdictions that are all interconnected, but appear separated because of the secrecy that each jurisdiction allows,” Cardamone explains. “So, for example, someone will create a shell company in the Cayman Islands that will be controlled by a trust in Panama and connected to a bank account in Liechtenstein – and because you’re in three different secrecy jurisdictions, there are three separate entities and nobody really knows who controls each one.”
While dictators routinely cover their financial tracks, some analysts suggest Mubarak began tying up loose ends last month after Swiss authorities froze the family bank accounts of former Tunisian president Zine El-Abidine Ben Ali, who fled to Saudi Arabia during a popular uprising.
A small article published in Al-Ahram state newspaper on Jan. 21 said Cairo airport officials were forced to re-check 59 mysterious parcels of gold and foreign currency bound for Amsterdam because some of the packages were torn. The story was quickly buried, which only fuelled the speculation that a nervous regime official, possibly a front man for the Mubarak family, was transferring ill-gained wealth to an overseas account.
Egyptian authorities have frozen the assets of several senior regime officials, former ministers and high-profile businessmen, and banned them from leaving the country. They have also asked the United States and European countries to freeze the assets of certain Egyptian officials – though the names of Hosni Mubarak and his family were not on the list.
Foreign governments have expressed willingness to assist in investigations.
Within hours of Mubarak’s ouster on Feb. 11, Swiss officials ordered all banks in the country to search for, and freeze, assets of the former president and his family. The money could be returned to Egypt under new Swiss legislation aimed at helping countries reclaim cash and assets squirreled away in banks by dictators.
Britain’s Serious Fraud Office is also searching for assets linked to the Mubarak family, while the United States and the European Union have said they will consider taking action once they receive a formal request from the Egyptian government.
By then, Ashour fears, the money and assets will have been moved, hidden or laundered. [END/IPS/MM/AF/IP/HD/PI/RA/CM/SS/11]
IPS is an international communication institution with a global news agency at its core,
raising the voices of the South
and civil society on issues of development, globalisation, human rights and the environment
Copyright © 2022 IPS-Inter Press Service. All rights reserved. - Terms & Conditions
You have the Power to Make a Difference
Would you consider a $20.00 contribution today that will help to keep the IPS news wire active? Your contribution will make a huge difference.