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USA/Gabon: Blind Eye for Corruption

AfricaFocus Bulletin
Jun 30, 2011 (110630)
(Reposted from sources cited below)

Editor's Note

The White House was brief in an official statement after the June 9 visit of the President of Gabon. The statement concluded by noting that "President Obama urged President Bongo Ondimba to take bold steps to root out corruption and to reform the judiciary and other key institutions to ensure the protection of human rights, and he welcomed the reforms that Gabon has taken under President Bongo Ondimba to bring more transparency and accountability to government. Both leaders agreed to continue to work together to promote peace and security, as well as advance good governance in Gabon."

Journalists as well as civil society activists in Gabon, however, saw the meeting in itself, and the ongoing good relations between the United States and Gabon, as a signal that reform was hardly at the top of the list in U.S. relations with the oil-rich state which has played important diplomatic roles in both the African Union and the United Nations. Prior to the meeting, representatives of Gabonese civil society released an open letter to President Obama, calling on him to live up to the inspiring words of his speech in Ghana in 2009, and noting that "Gabon today is trapped in a predatory and corrupt system which steals billions of dollars in state resources."

This AfricaFocus Bulletin contains the text of that letter, courtesy of Pambazuka News (http://www.pambazuka.org). It also contains excerpts from an extensive 2010 report from the U.S. Senate as one of four case studies of U.S. involvement with funds from corruption in African countries.

For a blog summary of coverage of the visit in the United States, see http://africasacountry.com/2011/06/15/ali-bongo-takes-america/

The brief official White House statement is at http://tinyurl.com/6d39uco, and the response to questions by the White House press spokesman Jay Carney is at http://tinyurl.com/6cxkp6s

On protests suppressed in Gabon earlier this year, see the Feb. 17 article in Pambazuka (http://www.pambazuka.org/en/category/features/70961) and additional coverage in Global Voices at http://globalvoicesonline.org/specialcoverage/gabon-unrest-2011/

For previous AfricaFocus Bulletins on Gabon, see http://www.africafocus.org/country/gabon.php

For recent issues on illicit financial flows more generally, see http://www.africafocus.org/docs11/iff1105a.php, http://www.africafocus.org/docs11/iff1105b.php, and http://www.africafocus.org/docs10/fin1004.php

++++++++++++++++++++++end editor's note+++++++++++++++++

Pambazuka News

Gabon in ruins: A democracy devastated
Open letter to US President Barack Obama

Marc Ona Essangui

2011-06-23, Issue 536

http://pambazuka.org/en/category/comment/74287

* Translated from French by Ifeoma Morah.

Gabonese President Bongo Odimba's visit to the US from 6-9 June has generated an outcry in Gabonese civil society. Its members sent a letter of inquiry to President Barack Obama asking him to take stock of a country with a democracy devastated by ruinous governance, but also to remind him of the meaning of his speech in Accra, which must be the basis of relations with African leaders.

Excellency, Mr President

It is in the name of the cardinal democratic values that are the foundation of the United States of America that Gabonese civil society comes to you as you prepare to receive Mr Ali Bongo Odimba, President of the Republic of Gabon, in order to expose to you, who presides over the Security Council of the United Nations, the catastrophic situation of governance and democracy in Gabon. Independent since 1960, Gabon suffers from two principal pathologies which affect all segments of society.

1. The Sick State of Democratic Governance

The main characteristic of this disease lies in the state's refusal to allow any democratic change, through the confiscation of power by fraud; rigged elections; the results of elections being known in advance; the housing of the electoral list in the Ministry of Interior, where it is subject to systematic manipulation; and trafficking of all kinds in order to maintain a corrupt system hated by the people. Ballot results are thus reversed in favour of the Gabonese Democratic Party (PDG), the party-state, in power for 44 years and one of the last remnants of political monolithism in Africa, which has been responsible for the widespread bankruptcy and ruin of the country.

Yes, Mr President, Gabon is in ruins; democracy is devastated.

Institutions as a whole have no credibility because they are ideologically and politically loyal to the Gabonese Democratic Party. Their sole purpose is the survival of the regime. The last constitutional amendment, decided upon unilaterally by the PDG, was for the sole purpose of strengthening the unlimited power of, and creating a life presidency for, Mr Ali Bongo. This is a perfect example of the democratic stagnation of Gabon.

Similarly, the Constitutional Court is one of the obstacles keeping Gabon from a real march towards democracy and the rule of law. This institution, headed by the lovely mother of Ali Bongo and composed of former chiefs of the ruling party, firmly blocks democracy. She stubbornly refuses the establishment of legal mechanisms for holding reliable, transparent and democratic elections with the direct involvement of civil society in all phases of democratic elections (pre-electoral, electoral, and post-election) in the country. The Constitutional Court has consistently opposed the introduction of biometrics in the electoral system, whereas all political actors and the civil society have unanimously made the providential choice in favor of biometrics.

We make the bitter report that the actions, methods, and practices of the Gabonese government are contrary to international norms and standards of democracy.

Journalists are imprisoned and threatened with death simply because they expose corruption and anti-democratic actions and accuse people from the government or the president's family. The journalist Desire Ename, managing director of the weekly 'Voices of the North', was abducted and detained by the police, an act instrumentalised by a relative of the president, Frederik Bongo. Thanks to the rapid mobilisation of the civil society, Desire Ename was released.

Every day, the freedom to unionise is threatened. Trade unionists defending their rights have been imprisoned. Some trade unionists, members of CONASYCED, saw their salaries suspended for several months for demanding that the government respect the commitments made to them.

Newspapers that are heavily critical of those in power are suspended or destroyed by agents in the service of power. Meanwhile, the two public television channels conduct a shameless manipulation of public opinion.

Forms of democratic expression such as peace marches are banned or brutally suppressed by security forces, whose treatment of the civilian population is similar to forces of occupation and repression.

The opposition parties are also marginalised, and their activities subject to numerous disturbances. Several members and supporters of a dissolved opposition party were removed from the public service or prosecuted.

As can be seen, Gabon is not a democracy. Political power is dictatorial, based on fraud and the repression of democratic forces, as the mechanisms used for sustaining political power are at odds with the democratic values on which the United States are based. It is indeed this same family which confiscates power and diverts public funds for the sole benefit of its small barony.

2. The Corruption of the Ruling Elite, who enrich themselves indefinitely, and the extreme poverty of the growing population

Since the arrival of Mr Ali Bongo Odimba, many decisions to improve the management of the state have been announced, but the implementation of these initiatives is still pending.

Meanwhile, corruption, particularly related to public procurement and management of revenues from extractive industries, is affecting all segments of the Gabonese government. The most significant example this year concerns deals for the 2012 CAN football tournament: The companies who have secured the largest contracts, SOCOBE and Entraco, both belong to the president's family. Similarly, oil revenues are completely in the hands of the president's family or relatives.

In the same trend of diversion, these rotating festivals, a true financial drain which has absorbed more than 500 billion CFA, have allowed various political barons and deans to shamelessly use the state's coffers with impunity. Most recently, the president has even built, at the taxpayer's expense, a sumptuous building in Paris worth Euro 100 million, while Gabonese children suffer from poor education and social inequality continues to grow.

Additionally, audit measures undertaken by the National Audit Office show the extent of embezzlement and economic crimes attached to festivals in Gabon. At the institutional level, the National Commission for the Fight Against Illicit Enrichment lacks effectiveness, independence, and the means of action to match its ambitions, for lack of political will. While the barons of the regime empty the coffers of the state, poverty is increasing by leaps and bounds. The country lacks everything.

The work of the Extractive Industries Transparency Initative (EITI) has come to a halt and the government does not seem to attach importance to this noble venture, whose last conciliation report was conducted in 2006.

Mr President, as you see, Gabon is in ruins. Gabon is strongly affected by these two conditions -- bad governance based on a fraudulent electoral system, and the corruption of the regime. The country was recently ranked highest among African countries in a corruption index.

Faced with this situation, civil society denounces in the strongest terms the intention to organise the next elections under the current fraudulent and anti-democratic conditions. It recommends on the one hand, the return of two rounds of voting for all elections, and on the other hand, the establishment of limitations for presidential mandates, the legislature, and the constitutional bodies of the state.

Armed with this, consider your historic speech to Africa in Accra, where you said: 'Governments that respect the will of their people, who govern by consent and not coercion, are more prosperous and more stable than those who do not.'

'It is not just a matter of holding elections; we must see what happens between elections. Punishment takes many forms and too many countries, even those that hold elections, are experiencing problems that condemn their people to poverty.'

'Nobody wants to live in a society where the rule of law gives way to the law of the jungle and to corruption. This is not democracy; this is tyranny, and even if we occasionally sow an election here and there, it is time that this style of government disappears.' You added that 'a strong democratic country is based on the stability of its democratic institutions and not politicians.'

Your speech in Accra resonates in our ears and was favourably received from those Gabonese who aspire to live in a country freed from tyranny and corruption; a country where citizens can express their views freely; a country that will see the advent of reliable and democratic institutions. Gabon today is trapped in a predatory and corrupt system which steals billions of dollars in state resources.

Mr President, such a system should no longer prosper. You must, on behalf of democracy and freedom, tell Mr Ali Bongo Odimba of your opposition to the militarisation of Gabon, to the installation of a reign of terror where the forces of the second and third categories are deployed on the street daily, like in a country under seige!

With this in mind, kindly send a clear message to Mr Ali Bongo Odimba on democracy and freedom and committing to:

  • Organising impartial democratic elections with the involvement of the civil society and under the supervision of the international community to ensure a peaceful transition to democracy, desired by the entire population of Gabon.
  • Adopt the institutional reforms proposed by the civil society to strengthen democracy through international standards of responsible governance specific to democratic systems.

Libreville, 8 June 2011

For Gabonese civil society:

  • Ona Essangui, President of Brainforest, Goldman Environment Prize 2009: (241) 07294140: ona_essangui@yahoo.com
  • Georges Mpaga, Chairman of the Board of Directors Network of Civil Society Free for Good Governance in Gabon (ROLBG): (241) 07519932: gmpaga@yahoo.fr
  • Alain Moupopa, President of African NGO Horizons of Human Rights: (241) 07751503
  • Dieudonn? Minlama Mintogo, President of the National Observatory of Democracy: (241) 07948719: minlamadd@yahoo.fr
  • Joel Celestin Mamboundou, President of the NGO Governance Democracy and Environmental Health (DILDOS) and TAI Network Coordinator: (241) 07943034

Keeping Foreign Corruption Out of the United States: Four Case Histories

United States Senate
Permanent Subcommittee on Investigations Committee on Homeland Security and Governmental Affairs

Staff Report for
February 4, 2010 Hearing

[Short excerpts only. Full report available on the Committee website at http://hsgac.senate.gov/public/ (click on hearings and go to the appropriate date)]

This Report examines how politically powerful foreign officials, their relatives, and close associates ??" referred to in international agreements as "Politically Exposed Persons" or PEPs ??" have used the services of U.S. professionals and financial institutions to bring large amounts of suspect funds into the United States to advance their interests. Using four case histories, this Report shows how some PEPs have used U.S. lawyers, real estate and escrow agents, lobbyists, bankers, and even university officials, to circumvent U.S. anti-money laundering and anticorruption safeguards. This Report also offers recommendations to stop the abuses.

...

IV. Bongo Case Study: Using Lobbyist, Family, and U.S. Trust Accounts to Bring Suspect Funds into the United States

El Hadj Omar Bongo Ondimba, the President of Gabon for 41 years until his death in June 2009, was long suspected of having accumulated his wealth through corruption. His eldest son, Ali Ben Bongo, assumed the office of the President of Gabon on October 16, 2009. For the ten years prior, he served as the Minister of Defense in Gabon.

This case history shows how President Omar Bongo used a U.S. lobbyist to bring over $18 million in suspect funds into the U.S. financial system to purchase U.S.-built armored cars and to obtain U.S. government authorization to purchase U.S.-built C-130 aircraft to support his regime. President Omar Bongo also brought substantial amounts of cash into the United States, including $1 million to support his daughter, Yamilee BongoAstier, who deposited the cash into U.S. bank accounts or safe deposit boxes. On occasion, Ms. Bongo-Astier also used her U.S. accounts to transact business for her father. Three different banks, HSBC, Commerce, and J.P.Morgan Chase Bank, provided her with banking services for several years without being aware of her PEP status. President Ali Bongo's first wife, Inge Lynn Collins Bongo, also kept substantial funds in the United States, at times using a U.S. trust to open accounts that masked her connection to the Bongo family.

1. Background

Gabon. Gabon, a country on the west coast of Africa about the size of Colorado, is the third largest oil producing state in Africa. It has a population of over 1.4 million.

Gabon declared its independence from France in 1960, but continues strong ties with that country and has adopted French as its official language. According to the CIA World Fact book, while Gabon enjoys a per capita income that is four times that of most of sub-Saharan African nations due to its oil resources, there is a significant disparity in incomes within the country and a large proportion of its population remains poor. The CIA estimated that, in 2006, Gabon's unemployment rate was 21 percent.

The U.S. State Department presents a mixed view of Gabon. On the one hand, the State Department applauds Gabon's willingness to work with the United States:

"Relations between the United States and Gabon are excellent. In 1987, President Omar Bongo made an official visit to Washington, DC. In September 2002, Secretary of State Colin Powell made a brief but historic visit to Gabon to highlight environmental protection and conservation in the Central Africa region. This was followed by a visit to the White House by President Omar Bongo in May 2004.

The United States imports a considerable percentage of Gabonese crude oil and manganese and exports heavy construction equipment, aircraft, and machinery to Gabon. Through a modest International Military Education and Training program, the United States provides military training to members of the Gabonese armed forces each year. Other bilateral assistance includes the funding of small grants for qualified democracy and human rights, self-help, and cultural preservation projects. U.S. private capital has been attracted to Gabon since before its independence."

On the other hand, in its 2008 Human Rights Report, the U.S. State Department condemns Gabon's use of torture, imprisonment, and restrictions on free speech, as well as the country's "widespread government corruption":

"The country's human rights record remained poor. The following human rights problems were reported: limited ability of citizens to change their government; use of excessive force, including torture toward prisoners and detainees; harsh prison conditions; arbitrary arrest and detention; an inefficient judiciary susceptible to government influence; restrictions on the right to privacy; restrictions on freedom of speech, press, association, and movement; harassment of refugees; widespread government corruption; violence and societal discrimination against women, persons with HIV/AIDS, and noncitizen Africans; trafficking in persons, particularly children; and forced labor and child labor."

Bongo Family. President Omar Bongo, born Albert Bernard Bongo, was one of 12 children from a farming family in southeast Gabon. He joined the French Air Force, was appointed to the staff of then Gabon President Leon Mba, and was elected Vice President of Gabon in 1967. He assumed the office of the Presidency later that year, when President Mba died in office from illness. President Omar Bongo ruled the country for the next 41 years, until his death on June 8, 2009.

Omar Bongo was elected President of Gabon six times, in elections held in 1975, 1979, 1986, 1993, 1998, and 2005. According to Freedomhouse in 2006:

"President Omar Bongo, already Africa's longest-serving ruler, won another seven-year term in a flawed November 2005 election, which was marred by a lack of competition and continuing military influence over the electoral process. Poor fiscal management and declining oil revenues have lowered the living standards of many Gabonese, though new oil discoveries and higher prices on the world market bolstered an economic turnaround in 2005. Three decades of autocratic and corrupt rule have made Bongo among the world's richest men, although some money has trickled down to rural areas and contributed to higher education standards."

Ten years ago, in 1999, the Subcommittee held a hearing and released a report which included a case history examining President Omar Bongo's use of U.S. private banking accounts.578 Materials released by the Subcommittee showed that, from 1985 to 1999, President Omar Bongo had used accounts opened by Citibank Private Bank in the United States to deposit, invest, and transfer over $130 million in funds suspected to be the proceeds of corruption. These documents showed that, in 1985, Cititrust provided President Omar Bongo with a Bahamian shell corporation called Tendin Investments, and Citibank Private Bank then opened a number of bank accounts in the name of that shell corporation as well as several accounts in Paris under the name of a second shell corporation, Leontine, Ltd. In addition, in 1995, Citibank Private Bank opened an account for President Omar Bongo in New York under the name "OS," a word which was simply the title of the account and not a corporation or other legal entity. The documents showed that Citibank Private Bank provided President Omar Bongo with extensive investment and banking services as well as tens of millions of dollars in loans.

The Subcommittee released copies of a number of Citibank Private Bank documents discussing the source of President Omar Bongo's wealth. A 1996 client profile, for example, noted that he did not come from a wealthy family and provided the following explanation of President Omar Bongo's source of wealth: "Head of State for over 25 Years - Source of Wealth/business Background: Self-made as a result of position. Country is oil producer."

A 1997 client profile elaborated further: "Self-made. President of African oil producing country for 30 years. Wealth created as a result of position and connection to French oil companies (Elf) since country is a major oil [supplier] to France. Wealth invested in real estate locally and in financial instruments overseas. It is believed that subject through affiliated [entities] retains ownership in many oil related ventures in the country which over the past 30 years resulted in significant accumulation of wealth estimated at $200MM."

Internal Citibank Private Bank emails dated April 9, 11, and 14, 1997, reported that certain "security" or "political" funds were set aside in the Gabon budget, in the range of $111 million per year, which were "understood to be used at the discretion of the Presidency" and were "at the disposal of the Presidency, without any limitation." The 1999 Report concluded: "The plain meaning of these documents is that the private bank was identifying Gabon government funds as a primary source of funds in the Bongo accounts."

Over the course of the following ten years, President Omar Bongo has continued to be the subject of corruption allegations. In March 2007, as explained in the prior section, three nonprofit anti-corruption organizations, Sherpa, Survie, and the Federation of the Congolese Diaspora, filed a legal complaint before the French Public Prosecutor alleging the ruling families of Gabon, Equatorial Guinea, Angola, Burkina Faso, and Congo owned millions of dollars worth of properties in France "that could not be the fruits of their official salaries ' but would have likely required the use of stolen public assets." The complaint attached articles and reports with alleged information about property and vehicles owned by the Heads of State and their relatives, including the Bongos. The complaint alleged, for example, that President Omar Bongo was involved in the Elf oil corruption scandal, had private banking accounts with millions of dollars, and multiple expensive properties in France. According to a later legal pleading filed in the case, a police investigation was launched in response to the complaint in June 2007, which confirmed most of the allegations and uncovered additional luxury properties, vehicles, and bank accounts belonging to the cited Heads of State and their relatives. The police allegedly confirmed, for example, that the Bongo family owned 39 luxury properties in "the wealthiest districts of Paris," and the President's wife bought an automobile "paid for by direct transfers from the Gabonese public treasury."

In November 2007, the police investigation was halted by the French Public Prosecutor. Since then, additional litigation has ensued over whether a nonprofit organization such as Transparency International France ("TI France") has standing to file a complaint against foreign officials and obtain an official investigation. In October 2009, a French appeals court ruled that TI France did not have standing to file the petition and dismissed it.

During his tenure in office, President Omar Bongo had several wives and is reported to have fathered over 30 children. His eldest son, Ali Ben Bongo, born Alain Bernard Bongo, served in various posts in the Gabon government, including ten years as the Minister of Defense from 1999 to 2009. On August 30, 2009, after his father's death, Ali Bongo won a contested election to assume office as President of Gabon, with 42 percent of the vote split among 17 candidates. Riots protesting his election occurred in Libreville, Gabon's capital, and Port Gentil, Gabon's second largest city. On October 16, 2009, President Ali Bongo was sworn into office. In 1994, Ali Bongo married Inge Lynn Collins, a U.S. citizen who is now estranged from him and living in California. He is also married to a Gabonese citizen, Sylvia Ajma Valentin Bongo.

President Omar Bongo's daughters include Pascaline Bongo, who was his chief of staff, and Yamilee Bongo Astier, a Canadian citizen who has lived at times in the United States.

...

[The remainder of the report includes extensive details from bank records on large transactions by a lobbyist and by Bongo family members.]


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