Angola has asked a Dutch court to hand over a half-billion-dollar stake in the Portuguese oil company Galp linked to ex-first daughter Isabel Dos Santos, its lawyers told Reuters.
Angola’s government says top officials under former president Jose Eduardo dos Santos took advantage of high oil prices in the last decade to spin a global web of business deals that led to their personal enrichment at the country’s expense.
Battered by COVID-19 economic fallout and mired in foreign debt, Angola is seeking to recover assets it says were siphoned off.
Its prime focus is Isabel dos Santos, the ex-president’s daughter, a business tycoon who became Africa’s richest woman.
The legal bid for the Galp stake has not previously been reported.
Dos Santos briefly ran state oil company Sonangol from 2016 until 2017, when her father’s four-decade rule ended.
Representatives for Isabel dos Santos, who lives outside Angola, did not reply to a Reuters request for comment.
She has denied any connection to the holding company at the centre of the case - Exem - which she says was owned by her late husband, rejects charges of wrongdoing and says she faces a political witch hunt by Angola’s new leadership.
Representatives of Exem did not reply to a request for comment. Dutch law firm Van Doorne, which represents Exem in the lawsuit, also did not respond to a request for comment.
The legal claim by Sonangol is due to be heard in the last week of May in the Amsterdam court of appeal, the 100%-state owned company’s lawyer Emmanuel Gaillard of law firm Shearman & Sterling said.
It will argue that Exem’s stake was acquired through embezzlement and money laundering.
“It’s all corruption ... you (Exem) owe us the shares, the indirect participation in Galp, because it’s theft. It’s illegal, therefore you have to pay it back,” Gaillard said.
Sonangol’s lawyers say the sale by Sonangol of part of its stake in Esperaza to Exem made no business sense for Angola and was made to enrich the former first family.
Under President Dos Santos, Sonangol sold a 40% stake in an offshore holding company, Esperaza, to another holding company - Exem - owned by Isabel’s husband Sindika Dokolo, a Congolese businessman who died in a diving accident last year.
Esperaza, in which Sonangol retained a 60% stake, in turn partnered with the business empire of Portugal’s Amorim family to form yet another holding company, Amorim Energia, which is the largest shareholder in Portuguese oil company Galp Energia with a 33.3% stake.
The value of holding company Exem’s indirect stake in Galp fluctuates with oil prices and is currently worth about $500 million.
A source with knowledge of the Amorim family’s position, who declined to be named, said its main interlocutor in the joint stake was not Exem but Sonangol, calling their partnership with the state firm “good and close”.
“(The case) does not affect these relations, it does not change anything”, the source added.
A representative of Esperaza did not respond to a request for comment.
Galp has said it has no dealings with Dos Santos. It declined further comment for this story.
The dispute, which is being heard in Amsterdam after both sides agreed on arbitration, already resulted in a ruling last September that removed Exem’s representative from Esperaza’s board and put its stake under the control of a court-appointed trustee.
Angolan billionaire Isabel dos Santos called on Tuesday for a corruption case against her to be dropped, accusing Angolan authorities of using forged documents including a bogus passport to get courts to seize her assets.
Angolan authorities seized the accounts of dos Santos and her husband Sindika Dokolo late last year over allegations that they steered $1 billion in state funds to companies in which they held stakes during the presidency of her father Jose Eduardo dos Santos, who ruled for 38 years until 2017.
In February, Portuguese prosecutors followed suit, freezing Isabel dos Santos’ assets in the country, which was Angola’s colonial master until independence in 1975. She and Dokolo have denied any wrongdoing.
Dos Santos, 47, whose whereabouts are not known, said her lawyers had discovered a fabricated passport in her name last month when granted access to the Luandan court’s files on the asset freeze for the first time.
The passport was in English, the passport number was cited differently in two locations on the document and the signature belonged to long-dead kung fu star Bruce Lee, who died in 1973.
“The Angolan Public Prosecutor’s Office presented material evidence that was fabricated and based on a forgery. This court decision should be struck out as abuse of process and the judgement set aside,” dos Santos said in an English-language statement.
“The forgery of the passport is obvious at first glance,” it said.
Neither Angolan nor Portuguese prosecutors responded to requests for comment.
The Luandan Provincial Court in Angola could not be reached for confirmation or comment on what impact there would be on the asset freeze if the document dos Santos cited was proven to be fabricated and part of the file against her.
Angola has named dos Santos as a suspect over alleged mismanagement and misappropriation of funds while she was chairwoman of state oil firm Sonangol in 2016-2017.
Angola’s chief prosecutor said in January that an international arrest warrant for dos Santos could be issued if she fails to appear to cooperate with the investigation.
Isabel dos Santos was brusquely removed from her job running the giant state oil company, Sonangol. Her half-brother received similar treatment at the state's sovereign wealth fund, and soon afterwards found himself in custody and is now on trial for allegedly trying to smuggle some $500m (£380m) out of the country . José Filomeno dos Santos has denied wrongdoing.
But JLo's moves to tackle corruption is now in danger of being overshadowed, and perhaps even derailed, by the second, key, part of his reform program - the economy.
Isabel dos Santos, 46, the daughter of Angola's long-running leader of 38 years, was mostly seen as untouchable in Luanda.
In fact, for most of her life, she represented both worlds.
She was born in Baku, Azerbaijan, during the Cold War era to a Russian mother and an Angolan father who would later become President.
She went to school in London, the centre of Western capitalism.
When she came back to Angola, her story goes, she begun from the grassroots, "sweeping the streets" of Luanda through her company, and later launched a popular restaurant known as Miami Beach.
She had made her money at 24.
But recently, the world has been treated to a trove of more than 715,000 documents showing a labyrinth of hundreds of companies around the world where money was reportedly laundered by Isabel.
Leaked documents showed how Ms dos Santos got access to lucrative land, oil, diamond and telecoms deals when her father, Jose Eduardo dos Santos, was president.
New York-based International Consortium of Investigative Journalists (ICIJ), which published the 'Luanda Leaks' fingered Isabel, for looting her own country and using firms around the world to clean her money.
Suddenly, leading media houses in the West and around the world were starting to question whether Isabel dos Santos was worth $2.2 billion or whether she was in deed the 75th most influential woman in the world as claimed by Forbes magazine.
So how did the Angolans see it?
First, it wasn't news. Rumours of looting by the former president's family and his ruling People's Movement for the Liberation of Angola (MPLA) had been a subject of hushed discussions throughout dos Santos' 38-year rule.
In 2008, local journalist Rafael Marques created a whistleblowing website Maka Angola, where volunteers helped build a strong narrative against the integrity of the dos Santos. Few outside Angola believed him.
"Inevitably, this is the end of one empire and the political end of one family that has caused harm to Angola and to its people due to their excessive greed," Marques told the Nation in a phone interview, hopeful that the world could help pressure her into submission.
Some activists in Angola, muzzled during dos Santos reign just like journalists, said she did not "eat alone", even though targeting her could create a better public perception for the government.
CORRUPTION IN ANGOLA
"Corruption in Angola is a general thing and involves the state circles and the MPLA circles," Mr Carlos Rosado, an Angolan journalist who worked with ICIJ on the project, told Novo Jornal newspaper.
"I am not one of those who would think there is a selective persecution. We had to start from somewhere and I understand that it starts from Isabel dos Santos. That is the most reported case now but the judicial authorities have to expand the investigation scope to other sectors and personalities," Rosado said.
Isabel was often unreachable and untouchable.
Hiding behind a father who was the head of state, she simply chose to sue for any perceived malicious reporting or use state organs to harass critics.
In the wake of the recent scandalising stories, however, she has been all over fighting back the accusations.
In an interview with the BBC, she claimed the trove of files were stolen papers to orchestrate "witch hunt" against her and her father.
In Angola, Isabel's assets include a 25 per cent stake in Unitel, one of the southern Africa state's two mobile phone networks, and a 25 per cent stake in Banco Internacional de Credito (Banco BIC), 51 per cent in BFA and 99.9 per cent in Zap Media.
Last month, prosecutors froze her bank accounts and assets along with her husband's (Sindika Dikolo) after a court ordered she repays the state some $75 million in dodged taxes.
She did not appear in court and the decision was made in her absentia.
But she fought back the move in the mainstream media and social media, describing the freezing as baseless political vendetta.
"This is an orchestrated and well-coordinated political attack, ahead of elections in Angola next year. It is an attempt to neutralise me and to discredit the legacy of President Dos Santos and his family," she argued.
"I am a private businesswoman who has spent 20 years building successful companies from the ground up, creating over 20,000 jobs and generating huge tax revenue for Angola. Last year my businesses paid over $100 million in tax."
Her fall from grace began shortly after her father left the seat in 2017.
His successor, João Lourenço, sacked her as chair of the state-owned oil firm Sonangol in 2018.
Angolan Attorney- General Hélder Pitta Grós says she laundered money, forged documents and committed other economic crimes and maladministration during her stewardship of state-owned oil firm Sonangol.
Alexandre Neto, a political analyst in Luanda, told the Nation that the decisive move by authorities was an opportunity to launch a new governance system in Angola.
Her dealings in Portugal and elsewhere suggest the network for corruption was beyond Angola.
"Ms Isabel dos Santos revelations show that there is an international corruption web that goes beyond investigations in Angola", Mr Domingos da Cruz, a lecturer at state-owned Agostinho Neto University and activist said after the documents showed she profited from Western auditing firms.
"It is not a surprise that western governments, and companies, participated in what is now being seen as corruption for Ms Isabel dos Santos, her family and friends, and members of the former government," Mr da Cruz said.
Locally, Angola's perennial corruption means anyone else in power could steal.
Transparency International's Corruption Perceptions Index 2019 released Thursday ranks Angola 146 out of 180 countries, just 19 positions better than it was in 2018.
In fact, the ruling MPLA is handling the matter cautiously. Its top officials refused to talk about it.
MPLA spokespeople refused to return calls by journalists.
And Mr Manuel da Cruz Neto, an MPLA legislator only said "I have no details about this and I don't comment on media cases".
Opposition MPs, however, say Luanda Leaks purge has to spread to other Angolan individuals who allegedly siphoned money from the state.
Mr Liberty Chiaka Angolan of the main opposition party Unita said there were local henchmen.
"It involves a lot of people. The corruption fight should not be done in a selective manner but broadly and this means employing deeper political changes," he said, lamenting how details of fraud were published by foreigners rather than the local Attorney-General's office.
Ahead of elections next year, Ms Dos Santos hinted she could run for President.
But she has been exiled since her father left the seat and the MPLA claimed only the party president becomes a presidential candidate.
Meanwhile, Ms Dos Santos has accused everyone publishing information from the leaked documents as either racist or part of a political witch-hunt to finish her.
Source: Daily Nation
Angola's billionaire former first daughter Isabel dos Santos has been charged with money laundering and mismanagement during her stewardship of state-owned oil firm Sonangol.
Documents leaked this week alleged the daughter of ex-president Jose Eduardo dos Santos, plundered state coffers to build her fortune, estimated at $2.1 billion.
Isabel dos Santos is accused of mismanagement and embezzlement of funds during her tenure at Sonangol and is thus charged in the first instance with the crimes of money laundering, influence peddling, harmful management ... forgery of documents, among other economic crimes," prosecutor general Helder Pitta Gros told a news conference late Wednesday.
Investigations into Isabel dos Santos's 18-month tenure as Sonangol head from June 2016 were opened after her successor Carlos Saturnino raised the alarm about "irregular money transfers" and other dodgy procedures.
Dubbed Africa's richest woman, Isabel dos Santos is accused of using her father's backing to plunder state funds from the oil-rich but poor southern African country and moving the money abroad with the help of Western firms.
She stopped living in Angola after her father, who ruled the country with an iron fist for nearly 40 years, stepped down in 2017 for his anointed successor Joao Lourenco.
Gros said dos Santos was among five suspects, all of whom were currently residing abroad.
"At the moment, the concern is to notify and get them to voluntarily come to justice," said Gros.
Africa’s richest woman and Angola’s ex-first daughter Isabel dos Santos expressed interest on Thursday in running for the presidency despite an asset freeze and accusations of diverting more than a billion dollars of state money.
It was the first time the daughter of former president Jose Eduardo dos Santos, who ran Angola for 38 years until Joao Lourenco took the helm in 2017, has mooted entering politics.
Asked in an interview with Portuguese TV channel RTP whether she would be interested in the role of president, which is next up in 2022, dos Santos said: “It’s possible”.
Lourenco has cracked down on the role of his predecessor’s children, firing dos Santos from her job chairing oil firm Sonangol and her brother from the sovereign wealth fund.
The 46-year-old businesswoman nicknamed “The Princess” at home is estimated by Forbes magazine to be worth more than $2 billion, while two thirds of her compatriots live on less than $2 a day, according to the World Bank.
In the past, she has consistently identified herself as an entrepreneur, not a politician.
Dos Santos, her husband Sindika Dokolo and associate Mario Leite da Silva were subject to an asset freeze on Dec. 31 after accusations of steering more than $1 billion from Sonangol and official diamond trader Sodiam to firms where they held stakes.
She denies the allegations as a “witch hunt” forming part of an attempt to erase her father’s legacy and distract from failures under the new government.
In the RTP interview, she framed the accusations not just as an attack on her family but as a campaign against future candidates for office.
“We cannot use corruption, or the supposed fight against corruption, in a selective way to neutralise who we think could be future political candidates,” she said.
“It’s about the fight for power.”
Internal leadership elections for the ruling MPLA party, from which Lourenco and the dos Santos family hail, are set for 2021. Dos Santos told Reuters in an interview last week that economic doldrums mean a candidate from the rival UNITA party stands a real chance of winning the national poll in 2022.
Dos Santos, who lives abroad, divides opinion in Angola.
Supporters see her as an inspiring entrepreneur, while detractors say she embodies African corruption, with her fortune and Instagram-published jet-setting offensive to the poor.
Dos Santos holds significant stakes in several important Portuguese firms, including in Eurobic bank, telecoms company NOS, engineering company Efacec, and oil and gas company Galp Energia.
Isabel dos Santos, Africa's richest woman and the daughter of former Angolan President Jose Eduardo dos Santos, said her businesses in Angola are set to fail after a court froze her assets and bank accounts in the oil-producing country.
"Freezing my accounts prevents me from being able to manage and recapitalize my companies," Dos Santos, who has been living outside Angola since 2018, said in an emailed statement. "As such, they have all but been sentenced to death."
The 46-year-old London-educated engineer amassed a fortune during her father's almost four-decade rule and has an estimated net worth of about $2 billion, Bloomberg data shows. In Angola, her business empire includes stakes in Angola's biggest mobile telecommunications company Unitel, two of the country's biggest private lenders, Banco de Fomento Angola and Banco BIC, a supermarket chain, a beer factory and a cable company.
Outside Angola, Dos Santos holds indirect stakes in several companies, including Portuguese oil company Galp Energia SGPS and cable company NOS SGPS.
Earlier this week, an Angolan court placed a freezing order on the Angolan assets of Dos Santos, her husband Sindika Dokolo, and one of her executives, Mario da Silva. The nation's Attorney General accuses the three of engaging in transactions with state-owned companies that led to the government incurring losses of $1.14 billion.The move marks another step in President Joao Lourenco's bid to battle graft and dismantle the influence of his predecessor's family over key industries.
Since Lourenco took power in 2017, Jose Filomeno, Isabel's brother, has been fired as the head of Angola's sovereign wealth fund and accused of illegally transferring $500 million from Angola's central bank to the U.K. Their sister, Welwitschia dos Santos, recently lost her seat as a member of parliament after leaving Angola.
Isabel dos Santos, whose wealth and influence earned her the nickname "The Princess," has accused Lourenco of carrying out a witch hunt against her family and insists that her wealth has been the product of hard work and determination. She said she created more than a dozen companies in Angola that collectively employed more than 10,000 people, whose jobs were now at risk.
"I was given no opportunity to respond to the charges which, so far as we are even able to understand them, appear to be wholly bogus," she said. "We are concerned that the so-called charges may be based on fabricated documents."
Even so, the clamp-down against Dos Santos has been welcomed by some in Angola, where poverty is rife despite the nation's oil and diamond riches and resentment has been stoked by the concentration of power and wealth in the hands of a politically connected elite. The southern African nation is ranked one of the world's most corrupt nations by Transparency International.
"The idea that they are being the target of a witch hunt is hard to accept when many of them have been living the good life and never seemed to be worried when others were being prosecuted," said Paulo Carvalho, a sociology professor at Agostinho Neto University in Luanda, the Angolan capital. "The freezing order is aimed at preventing the transfer or sale of some of these assets and won't interfere with the day-to-day business of these companies."Dos Santos said she would fight the injustice that had been perpetrated against her and warned the court ruling would send the wrong message to international investors.
"If this judgment is allowed to stand it shows that the justice system is flawed and the government is prepared to abuse it for their own ends," she said. "This is a smokescreen to mask the flawed economic policy which the current government have introduced."
Allegations made by the Angolan attorney general include that:
- The state, through its diamond-marketing company Sodiam and oil company Sonangol, transferred large sums of foreign currency to foreign companies -- of which the ultimate beneficiaries were the individuals facing the court order -- without securing the expected returns.
- Sonangol paid 75.1 million euros ($83.8 billion) to buy a stake in Galp Energia indirectly held by Dos Santos and her husband. Shortly before Dos Santos was fired as Sonangol's chairwoman in 2017, she tried to repay the consideration received for the stake in Angolan kwanzas but Sonangol's new board returned the money and asked that payment be made in euros. It was never received.
- Dos Santos and her husband entered a 50-50 joint venture with state-owned diamond company Sodiam to invest in Geneva-based jewelry maker De Grisogono. Sodiam ended up paying most of the initial 120 million-euro loan that was taken to fund the investment.
- Former President Dos Santos ordered Sodiam to sell diamonds to companies related to the individuals notified in the court order at below market prices. They then sold the gems abroad and generated hefty profits.
- The three individuals sought to hide assets bought with state funds by transferring them to other entities. Almost all of their assets were alleged to be held outside of Angola.
- Portuguese police blocked a 10-million-euro bank transfer from a Portuguese bank to Russia that Dos Santos tried to carry out through her business partner Leopoldino Fragoso do Nascimento.
- Dos Santos tried to sell her 25% stake in Unitel to a foreign investor.