APDHE v. Obiang Family
Tracking Down Africa’s Oil Wealth
The people of Equatorial Guinea live in poverty, despite vast oil revenues. In July 2004, a U.S. Senate report found that huge sums of money had passed through Riggs Bank in the United States from Equatorial Guinea. $26 million was diverted by President Obiang from Riggs to an account in Spain of a shell company owned by him. It appears that a large portion of this money was then used to buy villas in Spain for members of his family. (Keywords: Unjust Enrichment - Corruption - Money Laundering)
Facts
The Permanent Subcommittee on Investigations of the U.S. Senate Committee on Governmental Affairs issued its report, Money Laundering and Foreign Corruption: Enforcement and Effectiveness of the PATRIOT Act, Case Study Involving Riggs Bank, on July 15, 2004. After extensive investigations and hearings, the subcommittee concluded that the total value of assets held by Riggs amounted to nearly $700 million, making “Equatorial Guinea” the bank’s single largest relationship. There were more than 60 accounts held by government entities, senior officials, and family members.
The report found that, for years, Riggs had disregarded its anti-money laundering obligations with regard to Equatorial Guinea and had turned a “blind eye” to evidence that the bank was handling the proceeds of foreign corruption. They had allowed, and sometimes actively facilitated, suspicious financial activity.
In one sequence of suspicious transactions highlighted in the report, approximately $26.5 million was transferred in sixteen payments over a three-and-a-half year period (2000–2003) directly from the official Equatoguinean governmental oil revenues account into a private account maintained at Banco Santander in Spain, by Kalunga Company S.A., a company the Subcommittee found reason to believe might be owned in whole or in part by President Obiang. The authorized signatories for the governmental oil revenues account were the president and either his son or his nephew.
Investigations undertaken by Open Society Justice Initiative partner organization Asociación Pro Derechos Humanos de España (APDHE) revealed close correlations in timing between at least five of these transfers and nine real estate purchases in Madrid, Gijon, and Las Palmas de Gran Canaria in the Canary Islands on behalf of the President, members of his family, and other close associates.
In 2008, APDHE submitted a Querella (criminal complaint) to Instructing Judge Baltasar Garzón, asking that a criminal investigation to be opened into the allegations. As widely reported in the Spanish media, police inquiries have uncovered extensive documentation suggesting the use of multiple intermediaries and a string of shell companies and real estate purchases to divert millions of dollars from the Equatoguinean Treasury to the benefit of senior officials, including the President’s nephew, a former Finance Minister, and the President’s son-in-law, the Delegate Minister of Civil Aviation.
In 2015, the investigating judge ordered the pre-trial detention without bail of Vladimir, Yulia and Igor Kokorev on charges of money laundering. Allegedly, they are behind some of the financial, corporate, and real estate transactions related to the official Equatoguinean governmental oil revenues account, including Kalunga Company S.A .The investigation continues.
Open Society Justice Initiative Involvement
The Open Society Justice Initiative is assisting APDHE, a Spanish human rights organization, in investigating the facts and preparing the legal arguments in the case.
Arguments
Money Laundering. The Spanish Penal Code makes it a crime for anyone to acquire, convert or transfer property knowing that such property was purchased by the proceeds from a serious crime, or for anyone to perform any other act to conceal or disguise its unlawful origin or to aid another person who has participated in the crime in evading the legal consequence of the crime. The defendants in this case regularly diverted funds from the Equatoguinean Treasury by ordering Riggs Bank to make the various transfers to private accounts held by a shell company controlled by the defendants and the President of Equatorial Guinea. The fact that the embezzlement may have been committed abroad is irrelevant because the Spanish Penal Code grants jurisdiction to Spanish courts over money laundering cases occurring in Spain, regardless of where the underlying crime occurred.
The case is currently under investigation.
On motions from the Prosecutor and from the civil party complainant (acusador popular), APDHE, the Pre-Trial Investigative Court (Juzgado de Instrucción) issues an order for the opening of an oral trial (auto de apertura de juicio oral), concluding that the Prosecutor has demonstrated sufficient grounds to warrant a move to the trial phase of the proceeding. The ruling paves the way for a trial in the Audiencia Provincial de Las Palmas against Vladimir Kokorev, his wife Yulia Maleeva, and one of their two sons, Igor Kokorev Maleeva, for money laundering in connection with alleged unlawful sales of upwards of €678.9 million of weapons to the Equatoguinean government. These sales allegedly generated for the Kokorev family highly inflated profits of at least €120 million in the period 1999-2014, including one transaction involving the sale to Equatorial Guinea of two fighter bomber aircraft for €25.5 million, planes the Kokorevs had purchased for $1.8 million. These favorable deals were allegedly facilitated by multi-million dollar bribes paid to family members of Equatorial Guinea’s President Teodoro Obiang, and/or other high governmental officials, such as the President’s son-in-law Fausto Abeso Fuma ($2.7 million); the President’s nephew Melchor Esono Edjo ($201,000); the President’s cousin Agustin Ndong Ona ($103,000); the President’s defense advisor Hassan Khalil Hashem ($1.2 million); and the former head of the President’s Military Cabinet Luciano Esono Bitegue Ate (€2.3 million). Proceeds of these alleged criminal transactions were laundered through dozens of offshore vehicles, including a global collection of real estate purchases valued at €91 million (among which two Trump branded condominiums in New York City, and a third in Panama). Because of the conditions imposed on the Kokorevs’ extradition from Panama in 2015, they may only be charged with money laundering offenses.
Vladimir Kokorev is released from pretrial detention.
Igor Kokorev Maleeva is released from pretrial detention.
Yulia Maleeva is released from pretrial detention.
The investigative judge orders pretrial detention without bail of Mr. Vladimir Kokorev and Ms. Yulia Maleeva, husband and wife, on charges of money laundering, as well as their son Igor Kokorev Maleeva. After being extradited from Panama to Spain, both of them are detained pending trial.
The investigative judge declares the secrecy of proceedings, which prevents the parties to the case from gaining access to the case file, except for the public prosecutor. The proceedings have since then remained secret.
APDHE joins the case before the Pre-Trial Investigative Court (Juzgado de Instrucción) in Las Palmas as “acusación popular” (private prosecution exercising an actio popularis).
Judge Garzón issues an order ratifying the determination of the Prosecutor requiring transfer of the case to the Pre-Trial Investigative Court (Juzgado de Instrucción) in Las Palmas.
The Office of the Prosecutor (Fiscalía) concludes that there is a case to answer and opens an official investigation in the Pre-Trial Investigative Court (Juzgado de Instrucción). The prosecutor also concludes that the investigation should commence in Gran Canaria in the Canary Islands rather than in Madrid, because the Kalunga account where the money was received was not in Madrid, but at the Banco Santander in Las Palmas, Gran Canaria.
Judge Garzón refers the case to the office of the National Criminal Court Prosecutor (Fiscal de la Audiencia Nacional).
APDHE submits the Complaint (Querella) to Instructing Judge, Baltasar Garzón.
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