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Nigeria: #Offshoreleaks

AfricaFocus Bulletin
Apr 11, 2013 (130411)
(Reposted from sources cited below)

Editor's Note

The International Consortium of Investigative Journalists (ICIJ) has begun publication of stories from a vast trove of documents revealing transactions in the "offshore world" of tax havens. The data, from an Australian investigation of offshore financial shelters and fraud, held more than 2.5 million records, which are being investigated by dozens of journalists. The total size of the files, measured in gigabytes, is more than 160 times larger than the leak of U.S. State Department documents by Wikileaks in 2010.

The files contain documents referring to companies principally in the British Virgin Islands, Cook Islands, and Singapore, only a few of the many offshore jurisdictions around the world. But the investigation has turned up offshore investors from around the world. Those published so far referring to Africa include Nigerian political figures and entrepreneurs, as well as a Thai official with close links to Zimbabwean President Robert Mugabe.

This AfricaFocus Bulletin contains an article by journalist Musikilu Mojeed of Nigeria's Premium Times, and excerpts from short profiles from the ICIJ site of prominent figures from around the world.

For the full set of reports to date, visit http://www.icij.org/offshore

For an overview of the project methods, see "How ICIJ's Project Team Analyzed the Offshore Files" ICIJ April 3, 2013
http://tinyurl.com/crku4yp

On Thailand's Nalinee Taveesin, see
"'Crony' of African Strongman Among Thai Names in Secret Offshore Files" ICIJ, April 3, 2013
http://tinyurl.com/d6me4nt

Also on Nigeria, see "Family of Televangelist Chris Oyakhilome Incorporated Secretive Company in Tax Haven" Premium Times, March 10, 2013
http://tinyurl.com/csb8a28

For previous AfricaFocus Bulletins on illicit capital flows and related issues, visit http://www.africafocus.org/debtexp.php

For an extensive overview of the illicit capital flows that are used to drain wealth from Africa, the USA, and around the world into secret tax havens, see the Association of Concerned Africa Scholars special bulletin on "Africa's Capital Losses: What is to be Done?", at http://concernedafricascholars.org/bulletin/issue87/

The new find of documents is a suitable reply to the Romney campaign comment quoted in the cartoon on the cover of that issue: "Criticism of Overseas Tax Havens 'Unseemly and Disgusting'"

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

#Offshoreleaks: President Jonathan's adviser, ex-oil minister linked to secret offshore firms

Musikilu Mojeed

Premium Times Nigeria - http://premiumtimesng.com

Direct link to article: http://tinyurl.com/bs85k8v

April 4, 2013

Musikilu Mojeed [2], Premium Times managing editor, is member of the International Consortium of Investigative Journalists [9].

The International Consortium of Investigative Journalists [9] is an independent network of reporters in more than 60 countries who collaborate on cross-border investigations. It is a project of the Washington-based Center for Public Integrity.

President Goodluck Jonathan's special adviser on political matters, Ahmed Gulak, leads a growing list of Nigerian business and political elites who ran or still run secret offshore companies and accounts where they either hide their wealth to evade taxes, launder money or commit fraud, according to a cache of documents reviewed by PREMIUM TIMES [1] and the International Consortium of Investigative Journalists [2], ICIJ.

Mr. Gulak, who deals in the supply of fast boats, radial systems and naval communication equipment as well as military hardware to the Nigerian government, was linked to a secret shell company in the British Virgin Islands, one of the world's most notorious tax havens.

Mr. Gulak is listed along with a former petroleum minister, Edmund Daukouru, and a former head of the Nigeria Ports Authority, Bello Gwandu, as key Nigerians indulging in this practice, according to our investigations.

Ahmed Gulak acts as legal adviser to Erojim Group of Companies [3], according to information available on the company's website. Erojim is a contracting firm that claims to supply fast boats, radial systems and naval communication equipment and other military hardware to the Nigerian government in liaison with its foreign partner, Poly Technologies, and NORINCO, both of China.

On the other hand, Edmund Daukouru [4], a former petroleum minister sits on the board of Caverton Offshore Support Group, a Lagos-based provider of integrated offshore support services in Nigeria but which has also bounded with some foreigners to form a secret company abroad. Also on Caverton's nine-man board is Bello Gwandu, a ruling party politician and former managing director of the Nigeria Ports Authority, a federal agency that oversees and operates the ports of the world's most populous black nation.

Mr. Gulak, a lawyer and former lawmaker in Nigeria's Northwest state of Adamawa, is one of President Jonathan's closest aides, having worked as director of mobilization in the campaign that returned the president to power in 2011. As legal adviser and close associate of Jimmy Ntuen, Erojim's CEO, Mr. Gulak helped draft the legal papers for the incorporation of Erojim and its subsidiaries, including assisting Mr. Ntuen, who suddenly became Jimmy Ernest, when the British Virgin Island's version of Erojim was being incorporated.

These individuals are among a number of Nigerian officials and businesspersons who have links with shell companies abroad. It is not clear why they incorporated these shell companies - that is corporations that exist but do not have employees or assets and carry out no visible operations. But shell companies, according to Fraud Auditing Inc., a worldwide authority on fraud, have become progressively known for their involvement with illegal activities, including money laundering, tax evasion, billing schemes and fictitious service schemes.

Taking advantage of the loose laws in several jurisdictions, shell companies are easy to form and owners can remain anonymous while using nominee directors as fronts and deploying the corporations to hide illgotten assets, launder funds, dodge litigations or evade tax.

An example is convicted former Nigerian state governor, Diepreye Alamieyeseigha, who was found to have used Solomon & Peters (a shell company registered in the British Virgin Islands) and Santolina Investment Corporation, (a company incorporated in the Seychelles), to steal public funds with which he acquired assets valued at about 17.7 million British pounds while governor of the oil-rich state of Bayelsa. Nigeria's anti-corruption agency, the Economic and Financial Crimes Commission, has also accused another ex-governor, Abubakar Audu, of using two offshore companies in Bermuda (another tax haven) to hide ill-gotten assets.

Nigeria, Africa's most populous country, is the 35th most corrupt country in the world, according to Transparency International's 2012 rankings. Although the country has enormous oil resources, earning $24.5billion a year, according to the Revenue Watch Institute, most of its wealth are routinely stolen by kleptomaniac leaders who usually form shell companies to conceal their ill-gotten assets. The result is that the West African giant has remained among the most poverty-stricken in the world, ranking 156th out of the 187 countries rated in the United Nation's most recent Human Development Index.

The Tax Justice Network, an international group campaigning against tax havens, estimates that about $11.5 trillion is held offshore by individuals - with a resulting annual loss of tax revenue on the income from these assets of about 250 billion dollars. "This is five times what the World Bank estimated in 2002 [5] was needed to address the UN Millenium Development Goal of halving world poverty by 2015," the group said. "This much money could also pay to transform the world's energy infrastructure to tackle climate change."

These funds are usually held via shell companies in tax havens. It is not clear whether that is what Mr. Gulak's Erojim Energy and Equipment, registered in the BVI on June 8, 2006, set out to accomplish. The company, with registration number 1032037, is listed on company website as a subsidiary of Erojim Group of Companies to which Mr. Gulak is directly affiliated. The offshore Erojim has company chairman, Jimmy Ntuen Ernest (45,000 shares) and a certain Wang Yong (5000 shares) as directors. Mr. Yong, listed on company website as director of commercials, is in turn related to around 40 other shell corporations, raising questions about whether he is a nominee director and what his real business motives are.

The Nigerian version of Erojim was incorporated in 2000 and it has, by its own admission, done businesses with the Nigerian government through its ministries of defence and education. It is not known whether Mr. Gulak has tapped his closeness to the government to facilitate businesses for Erojim. But it is common for officials in Nigeria to use fronts to corner contracts for themselves.

Company documents suggest that Erojim BVI is inactive having been struck out for non payment in October 31, 2007, but owners have continued to showcase the firm on company website as a viable subsidiary in the British Virgin Islands. The group also suggests it has two subsidiaries in the United Kingdom - Barnes and Tubbies Linited (with registration number 6620080) and Erojim Investment Limited (with registration number 6620062) raising even more questions about the company's seeming fetish for incorporating offshore companies not known to carry out business operations. Erojim's chairman seems to peddle double identities as well. While he is known as (Obong) Jimmy O.Ntuen on company website, he is identified as Jimmy Ntuen Ernest in Erojim BVI's company documents, again raising questions about his business tactics.

Mr. Gulak didn't answer or return calls. He also did not reply to a text message seeking comments. Calls to the number listed on company website were answered by a woman who said she does not work in Erojim and had no relationship with the company whatsoever. "This is my personal number as you can see," she said, in a March 1 telephone exchange. An email enquiry bounced back, suggesting that the email address listed on company website is also not working.

Ex-petroleum minister, former ports chief and their secret offshore company

In June 2008, Mr. Dakouru, 69, a former petroleum minister and now a revered traditional ruler in Nigeria's oil-rich but restive Niger Delta region, teamed up with eight others - Aderemi Makanjuola, Olabode Makanjuola, Adeniyi Makanjuola, Sola Falola David Vickers, Bello Gwandu, Bashiru Bakare and Akin Kekere Ekun - to form Caverton Offshore Support Group [6].

But in the run-up to the formation of the company, brothers Adeniyi Makanjuola and Aderemi Makanjuola had, on March 23, 2008, partnered with two other Singaporean brothers , Claes Thortensen and Olav Thortensen, to incorporate CT Offshore (W.Afica) Ltd, a shell company in the British Virgin Islands.

Olav and Claes are chair and president respectively of Thome Group of Companies, a Singaporean company which, according to company website, "offers a wide range of shipping services including full technical management of every kind of oil and chemical tankers, LNG vessels and other specialist tonnage."

A year later, March 28, 2009, Mr. Dakouru's Carveton Offshore and the Thortensen's Thome Offshore Management Pte Limited became directors/shareholders of CT Offshore. The purpose for which the parties formed CT Offshore remains unclear. Caverton Offshore is not known to refer to CT Offshore as its subsidiary or investment vehicle. The group's annual reports for 2009 and 2010 only referred to Carverton Marine Ltd and Caverton Helicopters Ltd as the company's only subsidiaries. The company's website is also silent on the existence of CT Offshore just as the Thome Group, joint owner of the secret company, did not list CT Offshore among its six subsidiaries. The cloak of secrecy around the company and the unwillingness of its owner to discuss its existence raise questions about the real reason for its incorporation.

Caverton and its officials wouldn't comment for this story. An official, Uteh Assang, who identified herself as a personal assistant to Aderemi Makanjuola said owners and top managers of the company were unavailable for interview. She promised to pass our enquiry along to her bosses who would then return our call. The call wasn't returned. Subsequent calls were unanswered just as our email enquiry was sent back by the company's server.

Top businessman, Samir Ajami and his secret Nigerian company

Samir Ajami [7], an expatriate with American and European roots, is well known in Nigeria as managing director of Givanas Nigeria Limited (which produces consumer goods such as milk, tomato paste, corned beef, sardine and teabags) and Negatrex Limited (which specializes in the production of soaps and beauty products). The businessman is also known as one of the two trustees of Givanas Charitable Foundation, which provides scholarships to indigent university students and engages in other philanthropist activities in the country.

What many Nigerians definitely do not know is that Mr. Ajami has a third company concealed through a shell company incorporated in the British Virgin Islands. That company is Lagos-based Eko Resources Supreme Limited [8], which produces detergents and medicated soaps. Eko Resources was incorporated in Nigeria on June 3, 2004 with its directors being Sadikin Sungkono and Jokoraharjo Nur Bambang (both Indonesians) and WW Trade Limited, a secret firm registered in the British Virgin Islands. Out of the 3750000 shares that have been allotted by Eko Supreme, WW Trade owns 3748000 while Sungkono and Bambang hold one share each.

Mr. Ajami hid his interest in Eko Supreme by simply buying into WW Trade at the British Virgin Islands. That way, his name does not appear in company documents and authorities definitely can't trace the company to him. It is not known why the businessman decided on this tactic. Calls to his offices in Lagos were not returned. Email enquiries were also not responded to. However, hiding ownership this way helps businessmen elsewhere to conceal assets, evade tax and become monopolies through fronts.

WW Trade was incorporated in the BVI on November 5, 2001 with 50,000 allotted shares and authorized capital of $50,000. The eight directors at inception were Teddy Jeffrey Katuari, Freddy Ignatius Katuari, Eddy William Katuari, Finney Henry Katuari, Hanny Sutanto, Alex Ivan Tanojo, Handoyo Sutanto and Gen Tijn Tan. By September 15, 2005, ownership had changed, leaving Samuel Chee Wee Seng, Sungkono Sadikin and Edwin Katuari as directors and on October 10, 2005, without a meeting of directors, the authorized capital of the company was raised from $50,000 to $20,000,000, divided into 20,000,000 shares of $1 per value.

And on July 1, 2007, Mr. Ajami became a director of the company. But that was after acquiring a total of 3, 907,692 of the company in five installments: 1,333,333 (Nov. 4, 2005), 666,667 (July 22, 2006), 307,692 (Aug. 23, 2006), 1,200,000 (Dec 22, 2006) and 400,000 (February 23, 2007). He is currently the second largest shareholder in the company, behind only Universal Wellbeing Pte Ltd, a Singaporean Real Estate Developers, which has a total of 12,700,900 shares. By implication , Mr. Ajami is the second largest owner of Lagos-based Supreme Resources, although the company describes itself as a subsidiary of Wing Corporation, an Indonesian company that exports detergents, soaps, foods and beverages around the world.

Mr. Ajami didn't respond to our request for comments. When a call was placed to his office on March 2, an official, Bola Arowosegbe, requested that questions be emailed directly to her. "Message received and shall be directed to Mr. Ajami," Mrs Arowosegbe later wrote in response to our email. "He shall revert soon."

Mr. Ajami is however yet to respond.

URLs in this post:

[1] Premium Times:
http://premiumtimesng.com
[2] International Consortium of Investigative Journalists:
http://www.icij.org/journalists/musikilu-mojeed
[3] Erojim Group of Companies:
http://www.erojim.com/our_team.htm
[4] Edmund Daukouru:
http://en.wikipedia.org/wiki/Edmund_Daukoru
[5] estimated in 2002:
http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:20035446~menuPK:34495~pagePK:34370~piPK:34424~theSitePK:4607,00.html
[6] Offshore Support Group:
http://caverton-offshore.com/
[7] Samir Ajami:
http://givanasfoundation.org/About_us.html
[8] Eko Resources Supreme Limited:
http://www.esrnl.com/index_files/Page385.htm
[9] International Consortium of Investigative Journalists:
http://www.icij.org/
[10] Premium Times, ICIJ, BBC, Washington Post, 35 Others Lift Veil On Secret Offshore World:
http://premiumtimesng.com/news/128183-premium-times-icij-bbc-washington-post-35-others-lift-veil-on-secret-offshore-world.html
[11] A presidential adviser (Ahmed Gulak) and his dangerous polemics, By Garba Shehu:
http://premiumtimesng.com/opinion/127084-a-presidential-adviser-ahmed-gulak-and-his-dangerous-polemics-by-garba-shehu.html
[12] GLOBAL INVESTIGATION: Inside the Offshore Global Money Maze:
http://premiumtimesng.com/news/128172-global-investigation-inside-the-offshore-global-money-maze.html
[13] Fire rages, as two still missing in Chevron Nigeria offshore rig incident:
http://premiumtimesng.com/business/3491-chevron-nigerian-rig-fire-still-burning-two-missing.html
[14] Government may stop offshore oil facilities:
http://premiumtimesng.com/news/4275-government_may_stop_offshore_oil_facilities_commissioning_abroad.html


Excerpts from "Who Uses the Offshore World"

Thailand
Nalinee TaveesinNalinee Taveesin

International trade representative, former government minister

Details: In 2008, Taveesin was designated as one of four "Mugabe regime cronies" by the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC). The OFAC statement read, "Nalinee Taveesin has participated in a number of initiatives on corruption and growth challenges in Africa and Southeast Asia while secretly supporting the kleptocratic practices of one of Africa's most corrupt regimes." This statement became a point of controversy in Thailand when Taveesin was appointed minister for the prime minister's office in January 2012. She strongly denied the allegations, saying that her relationship with Zimbabwean dictator Robert Mugabe and his wife is "strictly social" and that she is a victim of guilt by association.

Offshore business: Taveesin and her brother Anuraj Mishra in 2008 bought a company called Hall Kingston International Limited that had recently been incorporated in the British Virgin Islands. They appear in the documents as directors and shareholders. The offshore company was acquired shortly after Taveesin's first appointment to a political position, as secretary to the commerce minister in 2008. The company does not appear in her 2012 public statement of assets. Though the company still exists, according to records in the BVI, it is unclear whether it had to be publicly declared.

Comment: Taveesin's secretary Ms. Supavadee responded that "She [Taveesin] strongly affirmed that she had neither known nor heard about this so-called Hall Kingston. The information about her being [a company] shareholder is incorrect," When asked if it was possible that Taveesin's brother, Anuraj Mishra, was a shareholder of Hall Kingston International Limited, Supavadee repeated, "She [Taveesin] had no knowledge about the company and none of her family members were involved in the company."

...

South Africa/Zimbabwe
"Billy" RautenbachMuller Conrad "Billy" Rautenbach

Businessman

Details: Zimbabwean millionaire with close links to the Mugabe regime. The United States blacklisted him saying he has helped organized huge mining projects in Zimbabwe that "benefit a small number of corrupt senior officials." Rautenbach fled South Africa in 1999 after being accused of fraud. The charges lodged personally against him were dismissed, but a South African company he controlled pleaded guilty to criminal charges and paid a fine of roughly $4 million.

Offshore business: Shareholder of Artemis Group, LTD. (2006) in the British Virgin Islands.

Comment: Rautenbach denies U.S. authorities' allegations, contending that they made "significant factual and legal errors" in their blacklisting decision, his attorney, Ian Small Smith, said. Smith said Rautenbach's BVI company was set up as "special purpose vehicle for investment in Moscow" and that it complied with all disclosure regulations. The company is no longer active.


AfricaFocus Bulletin is an independent electronic publication providing reposted commentary and analysis on African issues, with a particular focus on U.S. and international policies. AfricaFocus Bulletin is edited by William Minter.

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