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Equatorial Guinea: President’s Son Convicted of Laundering Millions

French Court Orders 3-Year Suspended Sentence, Seizes Assets

Teodorin Nguema, Equatorial Guinea's vice president and son of President Teodoro Obiang. © Getty Images
(Paris) – A Parisian court on October 27, 2017, convicted the president of Equatorial Guinea’s eldest son in absentia of embezzling tens of millions of euro from his government and laundering the proceeds in France.

The court handed down a three-year suspended jail sentence and a suspended €30 million (US$35 million) fine for Teodoro Nguema Obiang Mangue, known as Teodorin, who is also Equatorial Guinea’s vice president. The court seized his assets in France valued at well over €100 million.

“This verdict against Teodorin Obiang is further proof that rampant government corruption in Equatorial Guinea has robbed its people of their country’s oil wealth,” said Sarah Saadoun, business and human rights researcher at Human Rights Watch. “The French government should repatriate the money ensuring it goes to key services where it should have been spent.”

The ruling comes after more than a decade of litigation initiated by two French anti-corruption organizations, Transparency International France and Sherpa. It is one of three cases the organizations brought against high-level government officials of different countries for allegedly laundering “ill-gotten gains” in France. It was the first of the three cases to reach a verdict and the first time a French court recognized non-governmental organizations’ standing to file a criminal corruption complaint.

Because the sentence and fine are suspended, they will only go into effect if Teodorin commits another crime in France. He has 10 days to appeal.

Teodorin has been the subject of a number of international money-laundering investigations, and his flamboyant lifestyle has been widely cast as a symbol of brazen government corruption. The huge amount of money looted by members of Equatorial Guinea’s ruling elite contributes to the country’s severe underfunding of health and education.

In 2012 the US Department of Justice calculated that Teodorin had spent US$315 million around the world between 2004 and 2011 on properties, cars, and luxury goods. This is nearly a third more than the Equatoguinean government’s annual spending on health and education combined in 2011, the most recent year for which there is data. At the time, Teodorin was the country’s agriculture minister, earning an official annual salary of less than US$100,000.

The Equatorial Guinean government has vigorously defended Teodorin, claiming that his actions were legal because of domestic laws that permit ministers to do business with the state through their own companies. The government has never investigated the allegations against him.

The president promoted his son to vice president in June 2016, days after a French court ordered him to stand trial, in an apparent effort to use diplomatic immunity as a shield from prosecution. When that failed, the government unsuccessfully sued France in the International Court of Justice to stop the prosecution, claiming it violated Teodorin’s immunity.

The court decision gives the French government control over millions of euro worth of assets seized from Teodorin, including a 101-room mansion on the exclusive Avenue Foch valued at over €100 million, €5.7 million worth of supercars, and millions more euro worth of art, jewelry, and luxury goods, according to the court decision ordering Teodorin to stand trial. France has no laws providing for the repatriation of recovered assets, but Human Rights Watch and other organizations are urging the government to ensure that the funds are repatriated to the country to benefit the people who are victims of official corruption.

In 2014 Teodorin settled a case with the US Department of Justice, which alleged that he bought a California mansion, private jet, and US$2 million worth of Michael Jackson memorabilia with money stolen from the public treasury. He agreed to pay US$30 million without explicit admission of wrongdoing. The settlement mandates that the funds be repatriated for the benefit of the Equatoguinean people, which US authorities are expected to do soon. Switzerland is currently investigating Teodorin for money laundering, and in December 2016 it seized a luxury yacht worth US$100 million and several luxury cars.

Official corruption is rampant in Equatorial Guinea. In 2004 a US senate investigation found that Washington-based Riggs Bank, which held Equatorial Guinea’s government accounts, transferred millions of dollars to companies apparently owned by government officials, including the president. Three members of a Russian family are awaiting trial in Spain on allegations of facilitating the purchase of homes for Equatoguinean officials with the money siphoned from Riggs bank.

The discovery of oil in the early 1990s catapulted Equatorial Guinea from one of the world’s poorest countries to the one with the highest per capita income in Africa. Yet the government has invested only a pittance in health and education and progress on health and education consistently lag behind regional averages. Some indicators, such as vaccination and school enrollment rates, have deteriorated since the start of the oil boom.

In June, Human Rights Watch published a report documenting how the ruling elite siphon off the country’s oil wealth, particularly by owning stakes in companies awarded hugely inflated public infrastructure contracts. Graft and mismanagement exist on such a large scale that they leave little money for health and education.

“The promotion of the president’s son to vice president in an apparent effort to shield him from accountability reflects the culture of impunity in Equatorial Guinea,” Saadoun said. “With today’s verdict, the impunity for Equatorial Guinea’s ruling elite has finally been pierced.”

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