The new Libyan government is said to be examining the Libya Investment Authority and its dealings with foreign banks
But the man in charge fears his scrutiny could be hindered by the continuing presence of Gadhafi-era fund managers
One rebel leader said the government should create an independent audit commission with the power to bring fraud charges
As the dust settles in the streets of Tripoli after the fall of longtime Libyan ruler Col. Moammar Gadhafi, the new government will have much to do to disentangle itself from the past because many of its officials served during the 42-year Gadhafi era.
While the government continuity can be help to stabilize the battle-scarred country, there are many questions about how Gadhafi's government invested the country's vast oil wealth. Mahmoud Badi, the person put in charge by the new government to examine the $65 billion Libya Investment Authority, says he is scrutinizing dealings with foreign banks, such as Societe Generale SA or Goldman Sachs Group Inc. The investments undertaken by the French bank on behalf of Libya lost about $700 million while transactions carried by Goldman Sachs lost $1.4 billion. Both banks declined to comment.
"Losses of the [Investment Authority] were not less than $3 billion and might go to $6 billion," he said recently. The Wall Street Journal previously reported the U.S. Securities and Exchange Commission was examining a $50 million payment offered by Goldman Sachs to the Investment Authority for an outside advisory firm owned by a relative of the head of Libya's state-run oil company. The payment was never made, and Goldman has denied any wrongdoing.
Badi fears his scrutiny of such matters could be hindered by the return of old managers. According to news reports quoting officials in the new government, Mohamed Layas and Rafik Nayed, who had been named as chairman and chief executive, respectively, of the Investment Authority under Gadhafi, were reappointed at the helm of the fund in late August.
That reported announcement suggests the new government "is trying to stop the investigation," Badi said. Layas didn't return a call for comment, and Nayed couldn't be reached.
Badi isn't the only one to voice concerns. Abdelhamid Eljadi, an anti-corruption activist for 10 years during the Gadhafi era, called on the new government to dismiss Layas and Nayed from the investment authority.
Eljadi, who previously used the nom de guerre Tamer al-Zyat to avoid regime reprisals, said the government should create an independent audit commission with the power to bring fraud charges and the authority to restructure the fund.
Eljadi also expressed fears that the reappointments may indicates some tribalism in the new government since both Mahmoud Jibril, the de facto prime minister of the Libyan interim government, and Nayed come from the Warfalah tribe and from the same area of Zyadat.
Documents reviewed by The Wall Street Journal show Jibril, who was head of Libya's National Economic Development under Gadhafi, was a member of the board of trustees of the Investment Authority and that this board was tasked with overseeing its investments.
Badi confirmed the information but didn't comment further. An aide to Jibril couldn't immediately comment and couldn't be reached thereafter.
Former Investment Authority officials say that Jibril never actually attended a meeting of the board of trustees.
Eljadi says he believes that Jibril "should not intervene in any way with the Investment Authority directly or indirectly...as he was a member of the board of trustees of the Investment Authority during the era where it lost billions of dollars."
To be sure, the end of Col. Gadhafi's regime has opened the door to freedoms previously unknown to Libyans and brought new talent to government, such as oil and finance minister and former opponent Ali Tarhoni. Officials have also defended the reappointments of Layas and Nayed has a way to smooth the transition for the running of the fund because they are familiar with its workings.
But critics say the presence of the current prime minister on the trustees' list, along with the return of managers who were in charge when the fund was racked by losses, is a reminder of the struggles Libya faces to fully turn the page.
Says Eljadi, the reappointments of managers "defy the cause that 50,000 martyrs died for."
Source: www.foxbusiness.com
But the man in charge fears his scrutiny could be hindered by the continuing presence of Gadhafi-era fund managers
One rebel leader said the government should create an independent audit commission with the power to bring fraud charges
As the dust settles in the streets of Tripoli after the fall of longtime Libyan ruler Col. Moammar Gadhafi, the new government will have much to do to disentangle itself from the past because many of its officials served during the 42-year Gadhafi era.
While the government continuity can be help to stabilize the battle-scarred country, there are many questions about how Gadhafi's government invested the country's vast oil wealth. Mahmoud Badi, the person put in charge by the new government to examine the $65 billion Libya Investment Authority, says he is scrutinizing dealings with foreign banks, such as Societe Generale SA or Goldman Sachs Group Inc. The investments undertaken by the French bank on behalf of Libya lost about $700 million while transactions carried by Goldman Sachs lost $1.4 billion. Both banks declined to comment.
"Losses of the [Investment Authority] were not less than $3 billion and might go to $6 billion," he said recently. The Wall Street Journal previously reported the U.S. Securities and Exchange Commission was examining a $50 million payment offered by Goldman Sachs to the Investment Authority for an outside advisory firm owned by a relative of the head of Libya's state-run oil company. The payment was never made, and Goldman has denied any wrongdoing.
Badi fears his scrutiny of such matters could be hindered by the return of old managers. According to news reports quoting officials in the new government, Mohamed Layas and Rafik Nayed, who had been named as chairman and chief executive, respectively, of the Investment Authority under Gadhafi, were reappointed at the helm of the fund in late August.
That reported announcement suggests the new government "is trying to stop the investigation," Badi said. Layas didn't return a call for comment, and Nayed couldn't be reached.
Badi isn't the only one to voice concerns. Abdelhamid Eljadi, an anti-corruption activist for 10 years during the Gadhafi era, called on the new government to dismiss Layas and Nayed from the investment authority.
Eljadi, who previously used the nom de guerre Tamer al-Zyat to avoid regime reprisals, said the government should create an independent audit commission with the power to bring fraud charges and the authority to restructure the fund.
Eljadi also expressed fears that the reappointments may indicates some tribalism in the new government since both Mahmoud Jibril, the de facto prime minister of the Libyan interim government, and Nayed come from the Warfalah tribe and from the same area of Zyadat.
Documents reviewed by The Wall Street Journal show Jibril, who was head of Libya's National Economic Development under Gadhafi, was a member of the board of trustees of the Investment Authority and that this board was tasked with overseeing its investments.
Badi confirmed the information but didn't comment further. An aide to Jibril couldn't immediately comment and couldn't be reached thereafter.
Former Investment Authority officials say that Jibril never actually attended a meeting of the board of trustees.
Eljadi says he believes that Jibril "should not intervene in any way with the Investment Authority directly or indirectly...as he was a member of the board of trustees of the Investment Authority during the era where it lost billions of dollars."
To be sure, the end of Col. Gadhafi's regime has opened the door to freedoms previously unknown to Libyans and brought new talent to government, such as oil and finance minister and former opponent Ali Tarhoni. Officials have also defended the reappointments of Layas and Nayed has a way to smooth the transition for the running of the fund because they are familiar with its workings.
But critics say the presence of the current prime minister on the trustees' list, along with the return of managers who were in charge when the fund was racked by losses, is a reminder of the struggles Libya faces to fully turn the page.
Says Eljadi, the reappointments of managers "defy the cause that 50,000 martyrs died for."
Source: www.foxbusiness.com
No comments:
Post a Comment