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Sunday, 22 March 2009

Abacha Loot Deal: A Global Shame



  By Reverend David Ugolor

ABACHA LOOT - The immediate impact of the loot is: To deny our people potable water; Make it difficult to pay teachers; Deny the hospitals of medicine; And therefore cause the death of many; And contribute to the general debilitation; And immiseration of our society.

- Professor Mike Ikhariale, Harvard University , Cambridge , Massachusetts , USA .

INTRODUCTION

The incidence of looting public money and stashing it in western financial institutions is a global problem and developing/developed countries as well as international organizations are at loss on how to stem or control the phenomenon. Heads of States such as “Baby Doc” Duvalier of Haiti, Ferdinand Marcos of Philippines , Mobutu Sese Seko of Zaire , and President Suharto of Indonesia are the most publicized culprits of this global crime. It has been estimated that hundreds of billions of dollars have been expatriated both by these persons and lesser known figures and the consequences have been grave since citizens of the countries in which the practice occurs are bereft of developmental amenities as a result of stealing public money. President Sani Abacha, the late Nigerian Head of State, has however joined the league of the biggest culprits of this crime, as a source put the estimated amount he and his cronies stole at between twelve to sixteen billion dollars.

General Sani Abacha ruled Nigeria from December 1993 to May 1998 until he suffered a heart attack, which put a stop to his penchant for stealing public money and stashing them in Western banks. He rose from humble beginnings and became the Nigerian Defense Minister under the regime of another suspected looter of public funds, President Ibrahim Babangida when General Ibrahim Babangida relinquished power in August 1993; he put in place an interim government, which had as head Chief Ernest Shonekan, with Abacha retaining his portfolio as Defense Minister. Some months later Sani Abacha maneuvered himself to the number one spot, having forced Ernest Shonekan to hand over power on the pretence that hw was going to install a civilian administration.

Instead of doing this, General Sani Abacha eliminated all threats or those whom he perceived as threats as he commenced to perpetuate himself on the seat of power. As head of state, he made corruption and stealing the basis of the Nigerian political economy and those close to his wheeling and dealing, friends and relatives, became benefactors of his dubious schemes. He ran the Nigerian treasury and economy like a personal estate and to protect the estate, the political fortunes of the nation had to be subordinated to his whim. By 1997, he had conceptualized an elaborate self succession plan and this meant using money direct from the Nigerian Central Bank to hire marabouts, settle hanger-ons such as traditional rulers and politicians, many of whom went home with expensive car gifts for simply agreeing to keep him on as then nation’s leader.

Meanwhile, he had succeeded through using fronts to amass a wealth unofficially put at between twelve to sixteen billion dollars, but which for sake of official transaction was pegged at three billion dollars. To amass this wealth, Abacha rendered ministers that did not cooperate impotent, awarded contracts which were not executed, ordered the printing of Nigeria’s currency a la Idi Amin, and contorted newer and more ingenious means of stealing public money, as he used family members and other fronts in a massive money laundering scheme which involved over one hundred and fifty banking institutions. Raymond Baker, in a paper Money Laundering and Flight Capital: The Impact on Private Banking, wrote: “the biggest single thief in the world in the 1990s was almost certainly the late military dictator, Sane Abacha, with $12 to $16 billion passing out of Nigeria in corrupt and tax evading money during his murderous five year regime.”

To remain in power, General Sani Abacha murdered Pro-Democracy activists, jailed former Nigerian heads of state and politicians he perceived would be against his self-succession agenda, waged a deadly war with the press, turned his back on public opinion and harassed every human rights activist in the polity. It was during Abacha’s regime that the impoverished people of Ogoni Land began to campaign against the misuse of their resources and the environmental degradation, which Oil exploration was causing. General Abacha did not design to negotiate with them but instead arrested their leader, Ken Saro Wiwa, and caused him to be tried and executed in a deed that shocked the civilized world. In his defense, General Sani Abacha said the elimination of Ken Saro Wiwa was an imperative because he had conscientized the Ogoni people to a level in which all they wanted to do was to secede from Nigeria .

The killing of Ken Saro Wiwa, as well as the other human rights abuses perpetuated by General Sani Abacha, was extremely unpopular so there were widespread condemnations of his policies. By then, Nigeria had acquired the status of a pariah nation and her leader had acquired the reputation of being a bloodthirsty dictator who had no respect for human rights. As for the civil society, Abacha had no time to listen to its arguments, as all he was concerned with was how to remain in power no matter the odds against him. It was no wonder then that there was political instability during his regime as numerous ethnic groups emerged to terrorize the nation, state insecurity and armed robbery, assassinations, unexplained murders and other deviant acts pervaded the land. His plans to unleash more terror on the Nigerian Civil Society had reached advanced stages when he suffered a heart attack that put a stop to his plan to rule Nigeria as a civilian head of state.

His death paved the way for the entrance of General Abdulsalami Abubakar, who initiated a recovery of some of the Abacha loot and then a transition programme to civilian governance. The return to democracy saw the emergence of Chief Olusegun Obasanjo, who had earlier ruled Nigeria between 1976 and 1979 and who was among those jailed in Abacha’s gulag. When Obasanjo came to power for the second time, he had as a cardinal policy cancellation of the over forty billion dollars Nigeria had incurred as debt and the recovery of the massive loot which Abacha had banked in American and European banks. Chief Olusegun Obasanjo enunciated these commitments during an address at the |United Nations and those in attendance, including representative of G7 countries, applauded him for his courage in trying to tackle crucial problems that had led to the underdevelopment of not only Nigeria but the third world.

To achieve the recovery of the Abacha loot, Obasanjo liased with the authorities in the nations in which the former dictator had banked his money and they responded by freezing accounts in which the stolen wealth was contained. He then began the process whereby the Abacha family could be persuaded to return the loot back into the coffers of the country so it could be used for much needed development. Unfortunately, not everyone was impressed with Obasanjo’s bold attempts and there were many obstacles put in his way to ensure that he fails in his mission. For one thing, members of the Abacha family viewed with great misgiving appeals made onto them that they return the looted wealth and they did everything in their power to thwart Obasanjo’s move in this direction. In this, they were joined by members of the Northern Oligarchy and Pro-Abacha politician who persuaded them that it would be foolish if they gave away the family wealth, conveniently forgetting that the money belonged to the Nigeria state.

President Obasanjo’s attempts to recover the money became curiously linked with his drive to redress the human rights abuses perpetuated by Abacha when he constituted a panel to look into the crimes committed by the late President on the Civil Society. The Oputa Panel Human Right Commission exposed in vivid details the true picture of what Abacha and his goons did in order to stay in power and them commenced to indict members of that group and then former President Ibrahim Babangida over the killing of Dele Giwa, a famous Nigerian Journalist. In its recommendations, the Oputa Panel urged the government to compensate victims of human rights abuses during the Abacha era. It should be noted that a lot of people were not comfortable with some of the recommendations of the Oputa Panel, not the least former President, Ibrahim Babangida, who felt the report of the panel was a threat to his reputation.

It was these characters, which symbolized the forces of opposition that stalled the intention of Obasanjo to recover the loot, which Abacha had accumulated, so not much success was recorded. The Nigerian President, therefore, had to formulate any scheme to make the Abacha family cooperate with his government and return the billions of dollars looted from the treasury.

OUT OF COURT DEAL

Olusegun Obasanjo thought that under these circumstances, the best option left for him was to engage the Abacha family in an out-of-court agreement, if only to bring the much needed money back home. He had no choice – the Abacha family was uncooperative, the friends of the family advised it to hold out against Obasanjo, and the money spent by government in legal fees kept mounting, while the Abacha family was sparing no expense in its legal battles.

In the out-of-court agreement reached between the Abacha family and the government, the latter was to take eighty percent of the loot estimated at $1.2 billion while the Abacha family was to keep $100 million and $300 million per bond. To ensure that the Abacha family cooperates with this agreement, Mohammed, scion of the late dictator, would be released from detention and all legal challenges to his human rights record and his involvement in his father’s scam would be dropped. Two occurrences acted against the consummation of the agreement and it failed, becoming one of the abortive attempts at the recovery of the Abacha loot. Firstly, Mohammed Abacha, egged on by his family and friends of his late father who also participated in the orgy of looting and human rights abuses, reneged on his commitment at meeting is side of the bargain. Mohammed stated in rather vehement terms that he had not reached any agreement with the Nigerian government and that he was not going to meet his side of the deal.

In the second case, there were eyebrows raised over the deal on the part of the civil society on the count that it would be immoral to release a human rights offender on the basis of his being able to return eighty percent of his father’s loot. The ThisDay newspaper, in an editorial, stated that it was morally wrong to release the scion of the Abacha family merely on the fact that he has been able to return part of the loot of his father in European financial institutions. Other stakeholders on the loot issue questioned why a hundred million dollars should be left with the Abacha family since the late dictator had not done anything to generate the sum of money. The African Network for Environmental and Economic Justice (ANEEJ) condemned the deal on the count that it encouraged the culture of impunity and undermined the principle of rule of law, which is the essential element of good governance and sustainability and democratic society.

In any case, the fundamental weaknesses of the out-of-court deal on the legal and human rights angle, as well as the financial aspect of it, made it doomed for failure as another unsuccessful strive to bring the looted billion back into the country.

ABACHA’S LOOT AND POLITICAL INSTABLITY

The struggle of the Federal Government to get the Abacha loot has not been without cost to the later or to the ideal of democracy – it has led to political instability and the possibility of the termination of the rule of law in the polity. For the pro-Abacha politicians, the idea that money should be returned to the government was not acceptable as their access to that money was the basis of their own survival. They therefore had to regroup to fight to the end any threat to the Abacha loot as any success in getting it back to the coffers of the Nigerian nation meant their survival was not guaranteed.

Besides, General Ibrahim Babangida (Rtd), the erstwhile Head of State, was not happy with the Oputa Panel report since it was an indictment of his role in the murder of Dele Giwa. He would prefer a situation whereby there was no Oputa Panel or the possibility of it being used in the future to question or investigate his activities when he held sway as the nation’s President. The mutual interest of both forces to see to the termination of the Obasanjo’s regime led to an alliance whose course of action was to see to the impeachment of the President. The impeachment would serve two uses: the elimination of an opponent bent on stalling their penchant at looting at the loot of Abacha, and the implementation of the recommendation of Oputa Human Rights Commission capable of leading to their indictment in future.

To prevent being impeached, Obasanjo took recourse in the releasing of Mohammed Abacha as a counter-move to curtail the growing popularity of Pro-Abacha politicians, something he had to do because he was being blackmailed and arm-twisted by these people with the threat of not supporting him for a second term. Even though forced against his wish to take this measure, Obasanjo still gave conditions for the release of the most important being that Mohammed will refund about $1.5 billion as part of the money believed to have been looted during his father’s regime. Though all the blackmail is being waged against him, Obasanjo has insisted that the money belongs to Nigeria and that it should be returned into the nation’s treasury. This has underlined the point that the campaign to get back the money looted by the former dictator is still on course and that there is no let up in this mission even with the release of Mohammed.

WESTERN BANKS

General Sani Abacha started accumulating the money he put in Western Banks immediately after he took over power and he used front such as his son and business associates for the job. The dictator awarded contracts and pocketed the kickbacks, engaged in direct printing of the country’s currency in the manner of Idi Amin, diverted security votes into his personal accounts, over-invoiced the importation of petroleum fuel, engaged in Debt buy-back scams with Russian Steel companies and partook in numerous other activities all to accumulate more and more wealth. By the time he died, three billion dollars was said to be in his account or those of his surrogates, triggering attempts to get back the money from the banks he kept them.

Fig. 1

DIARY OF THE LOOT

Between November 17, 1993 and June 8, 1998 , during which the late dictator, General Sani Abacha, held Nigeria in his vicious grip, he treated the treasury like a hapless cow being milked to death. Abacha was not contented with raping the country through kickbacks from inflated contracts. On many occasions, he dipped his hands into the vaults of the Central Bank of Nigeria , CBN, where the strong currencies of the United States of America and British held out great attraction for him.

On March 25, 1994 alone, Abacha stole $37.6 million from the CBN. Ismaila Gwarzo, his national security adviser, NSA, was his main pointsman in looting the apex bank. Gwarzo told a Special Investigation Panel, SIP, set up by the present administration that he sent his special assistant to the bank between June 1996 and October 1997 to collect a total sum of $456 million and £232 million for Abacha.

The breakdown of the money stolen on each trip made to the CBN on his behalf as shown below would suggest that corruption, more than blood, ran through his veins:

February 15, 1995 - $4 million and £2 million

February 17, 1995 - $4 million and £2 million

February 27, 1995 - $4 million and £2 million

July 8, 1995 - $5 million, £2 million and another £2 million in traveller’s cheques

December 29, 1995 - $5 million

March 28, 1996 – Abacha requested for $5 million and £3 million. The CBN ran out of foreign currencies. It paid him only $3.801 million. He was very angry but collected the money grudgingly

May 29, 1996 - $5 million and £5 million. The bank ran out of pound sterling and sent $12.5 million to Abacha.

June 20, 1996 - $10 million and £5 million

August 20, 1996 - $30 million and £15 million

September 24, 1996 - $50 million

September 30, 1996 - $50 million and £3 million

October 14, 1996 - $5 million

November 11, 1996 - $5 million and £3 million

February 18, 1997 - $6 million

February 28, 1997 - $3 million

March 3, 1997 - $3.27 million

March 6, 1997 - $1.21 million

April 22, 1997 - $60 million

April 28, 1997 - $60 million and £30 million

June 30, 1997 - $4.9 million

July 9, 1997 - $5 million and £2 million

August 8, 1997 - $10 million

October 18, 1997 - $12.3 million

October 21, 1997 - £5.88 million

October 23, 1997 - £14.76 million

October 29, 1997 - £11.76 million

November 14, 1997 - $10 million

November 26, 1997 - $24 million

December 10, 1997 - $24 million

December 18, 1997 - £6.15 million

WHERE THE MONEY IS

After the death of Abacha, investigators in Nigeria , Europe and America stumbled on over 130 bank accounts at home and abroad where some of the money stolen was kept.

The banks are:

Australia and New Zealand Banking Group, ANZ, London branch

ANZ, New York

ANZ, Frankfurt

Bank in Liechtenstein A. G. Vaduz

Bank Len, Zurich

Bankers Trust Company, London

Bankers Trust Company, Frankfurt

Bankers Trust Company, New York

Banque Barring Brothers, Geneva

Barclays Bank, New York

Barclays Bank, London

Banque Edouard Constant, General

Banque Nationale De Paris, Geneva

Banque Nationale De Paris, London

Banque Nationale De Paris, Basle

Citibank N. A. London

Citibank N. A. New York

Citibank N. A. Luxembourg

Citibank Zurich

Credit Lyonnais , New York Credit Suisse , New York

Credit Suisse, General

Credit Suisse, Zurich

Deutche Morgan Grenfell, Jersey

FIBI Bank (Schweiz) A. G. Zurich

First Bank of Boston , London

First Bank of Nigeria Plc, London

Goldman Sachs and Company, Zurich

Gothard Bank, Geneva

Inland Bank ( Nigeria ) Plc, Lagos

LGT Liechtenstein Bank, Vaduz

Liechtenstein Landesbank, Vaduz

M. M. Warburg and Company, Luxembourg

M. M. Warburg and Company, Zurich

M. M. Warburg and Company, Hamburg

Merrill Lynch Bank, New York

Merrill Lynch Bank, Geneva

Midland Bank, London

National Westminister Bank, London

Nigerian Intercontinental Merchant Bank Limited, Lagos

Paribus, London

Paribus, Geneva

Royal Bank of Scotland , Leeds

Standard Bank London Limited, London

UBS AG, Zurich

UBS AG, Geneva

Union Bancaire Privee, Geneva

Union Bancaire Privee, London

Union Bank of Nigeria , London Branch

Universal Trust Bank of Nigeria Limited, Lagos

Verwaltungs Und Private Bank A. G., Vaduz

Source: Tell Magazine, October 7, 2002

Western banks cooperated with the Obasanjo regime at the initial stage when they agreed to freeze the Abacha loot but thereafter the emphasis on a legal approach by these banks compounded the issue. One should have expected that with the freezing of the Abacha accounts the money would be transferred immediately to the Nigerian treasury for needed development projects. Instead, the western governments demanded an agreement between the Federal Government and the Abacha family with the document signed by Mohammed before the banks would return the money. And the cooperation of Western Government was not total at first as those in Britain were slow in reaching to Obasanjo’s call for the Abacha loot until September 11 when terrorists brought down the World Trade Center in New York .

However, the puzzle still is the rationale behind these Western Government adopting an out-of court approach to the recovery of the Abacha Loot when the same banks dispensed with legalities in the aftermath of September 11 episode. There is no doubt that arrangement such as this is hampering efforts to recover the billions, which have been illegitimately stolen from Nigeria .

CIVIL SOCIETY

The Civil Society in Nigeria even though aware of the strides being made by government to recover the Abacha loot has also taken it upon itself to call for the return of the money. Human right and environmental groups have through public sittings, workshops, seminars, newspaper articles and other media sensitized the public on the issue and demand for justice to be done. They have also called for the money when recovered to be put into an International Trust Fund from where it could be used to prosecute specific and beneficial projects for victims of Abacha human and economic rights abuses, such as the Ogoni People. There is thus need, of course, for civil society groups to play an active role in this process, as they have been doing since the Abacha loot issue assumed a topic of international finance discourse.

Source:Odious Debts


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