Detectives to Trace Arafat Secret Fortune

Views on BG | November 16, 2004, Tuesday // 00:00| Views: | Comments: 0

Arab News

The Palestinian Authority has approached American investigators to trace bank accounts, stocks, bonds and real estate owned by the late Yasser Arafat and his close relatives and aides, Arab News has learned.

Palestinian sources said the firm of financial detectives Scots-Morseby was contacted while the Palestinian leader was fighting for his life at a military hospital west of Paris.

According to sources, the decision was taken after Arafat's wife Suha and his chief financial adviser Muhammad Rashid refused to produce a full report on secret funds held on behalf of the Palestinian Authority.

Craig Mason, a specialist in tracing slush funds and fighting money laundering, says Arafat's finances have been built in a deliberately complicated way to make detection and identification difficult.

"For all we know he may have transferred a good part of his fortune to his widow and other family members long before his death," Mason suggests.

According to the British weekly Observer one reason why Suha did not allow the Palestinian leadership to see her dying husband in his hospital room was her fear that they might persuade Arafat to sign a will giving away all his fortune to the Palestinian Authority.

French sources, however, offer a different version. They claim that Suha wanted to negotiate a package for herself before allowing access to Arafat.

According to several French newspapers, the deal was clinched when Suha got a check for $20 million plus a written accord to pay her $500,000 a year until her daughter Zahwah, now aged nine, reaches the age of 18. Until now, Suha has been receiving a salary of $35,000 a month as Palestine's first lady plus $250,000 a year for the upkeep of her homes in Paris, south of France and Tunisia.
Estimates of Arafat's fortune vary widely. Some put it at between $3 billion and $6.5 billion, but others cite lower figures such as $250 million.

A European Union audit of Palestinian Authority finances, conducted in the years 2002-2003, shows that Arafat had a secret personal budget of $80 million a year which he could spend as he pleased without leaving any documentary trace. The late leader's friends say he used the funds to support needy Palestinian families, to reward political and media friends in the Arab world and Europe, and finance secret missions by special emissaries.

It may take years before the extent of Arafat's business interests is established. He himself acknowledged full ownership of two companies, both headquartered in Tunis. One of the companies is a major shareholder in cellular telephone networks in Algeria and Tunisia.

The other company, originally formed and registered in Kuwait but later transferred to Tunis, specializes in building contracts and real estate. It owns a number of luxury hotels, holiday resorts, and apartment blocs in Lebanon, Tunisia, Algeria, France, Austria and Spain. Arafat is also reported to have a share in a Bulgarian bank that was privatized in 1996.

What the American financial investigators will be focusing on is a string of secret bank accounts that Arafat reportedly set up over the past 36 years to raise and use funds on behalf of the various organizations, notably Al-Fatah, that he created and headed. Those funds are believed to be spread across the globe, especially in tax havens such as Cayman Islands, Luxembourg, and Liechtenstein. Other accounts linked with Arafat have been traced to Austria, Belgium, Switzerland, France, Sweden, Greece and Bulgaria.

A spokesman for the federation of Swiss bankers said last Friday that his organization would cooperate fully with any investigation into secret accounts set up by Arafat. Techniques developed in recent years to fight money laundering by drug cartels and other global criminal organizations allow for a much faster tracing of secret fortunes than before. Switzerland is among 22 countries that have signed a set of agreements to freeze funds suspected to have been siphoned off from public treasury by politicians.

Since he signed the Oslo accords, Arafat has been in control of billions of dollars channeled to the Palestinian Authority. Some funds came from Israel in the form of customs duty collected on behalf of the PA. The European Union, for its part, contributed an average of $800 million a year. The authority has also received an undisclosed amount of donations from a number of Arab countries and charities.

Mason says it took investigators more than 10 years to trace only part of the fortune of Ferdinand Marcos, the late Philippine dictator. Work on tracing the fortune of the late Zaire despot Mobutu Sese-Seko is expected to continue for at least another 10 years.
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