“There remains a little less than 5 billion euros on the four accounts opened at Euroclear Bank SA.”
Denis Goeman — Spokesman from Brussels’ prosecutor’s office
“Making the interest and other earnings freely available to the Libyan Investment Authority is in non-compliance with the sanctions regime. Furthermore, considering the instability in the country, the disputes over the authority of the Libyan Investment Authority and the lack of an oversight mechanism, doing so could lead to the misuse and misappropriation of funds.”
“Nobody is preoccupied with the question of where the funds have gone and who benefitted from them. What is surprising is that nobody wanted to see what was going on and everyone is shutting their eyes at a political level … This is an extremely serious problem as it could uncover a real state scandal.”
Robert Wtterwulghe — Law professor at UC Louvain University
Brussels, Belgium ( March 9 2018) — After Gaddafi’s death in 2011, the U.N. passed a resolution to freeze his wealth, with the idea that it would be held in trust for the Libyan people until the war-shattered country stabilizes. Four separate accounts opened for the Libyan Investment Authority and Libyan Foreign Investment Company in the Euroclear bank held about 16 billion euros when they became ‘frozen’ under UN sanctions in September 2011. Today, there remains about 5 billion euros on these accounts. So the question is rather simple: Where did the €11 billion vanish to? Follow us on Twitter: @Intel_Today
RELATED POST: LIBYA: What is going on?
UPDATE (March 9 2019) — Bring the pop corn… This one is just beginning. And it is not going to be boring!
Until now, Belgian Foreign Minister Didier Reynders has denied any involvement in the decision to release these funds.
“It’s the responsibility of the finance ministry and I am no longer there since December 6, 2011. I have taken no decision in this areas,” Reynders stated in November 2018.
But a letter dated August 1st 2012 indicates clearly that Reynders was involved in an attempt to unfreeze the funds.
The letter also indicates the exact amounts of money held in these various frozen accounts.
Finally, the letter demonstrates that the Belgian Foreign Minister was looking for a legal trick — the ‘humanitarian cause’ — to unfreeze these accounts in order to pay some Belgian companies.
However, Belgian media reports that at least one of the companies listed in this letter was not actually seeking to be paid but wanted to reimburse Libya for an abandoned project…
Last week, we learned that Belgium Prime Minister Charles Michel lied to the Parliament when he stated that he had told the MPs all he knew about the case.
The UN has sent a letter to the Belgian government telling them that their behaviour was illegal. They also made a request which has not yet been revealed… The plot thickens.
END of UPDATE
In November 2013, four Euroclear Bank accounts belonging to the Libyan Investment Authority (LIA) and its subsidiary Libyan Foreign Investment Company (LFICO) contained some 16.1 billion euros.
Those assets have been frozen since March 2011 in accordance with the UNSC resolution 1973.
Investigating magistrate, Michel Claise, was in charge of the probe into an alleged money laundering scheme by Gaddafi’s inner circle.
When the Belgian authorities sought to seize these Libyan assets in the fall of 2017, they discovered that 10 billions euros were missing.
According to the Ministry of Finance, Belgium did not take any decision to unfreeze these assets.
So the question is rather simple: Where did the €10 billion vanish to?
UPDATE (October 29 2018) — Belgian media are reporting that Belgian banks paid out interest and dividends on Gaddafi’s accounts frozen under U.N. sanctions.
“RTBF said that up to 5 billion euros ($5.7 billion) could have been disbursed to people controlling Libyan accounts, including militia groups in the country accused of human rights abuses.” (REUTERS)
This much is about certain. When the United Nations agreed to freeze deposits held by Gaddafi’s administration abroad, Belgium did so but the Belgian banks did not halt payments of interest and dividends.
This, in itself, may actually not have been illegal. (NOTE – Nov. 4 2018 — It is now very clear to me that these payments of interest and dividends were illegal as I had actually suggested from the beginning. It is baffling that EU experts have argued otherwise.)
But in any case, if the money was used to fund terrorist groups in Libya, that is yet another major scandal.
Now, I would like to suggest that if 5 billion euros ($5.7 billion) have been disbursed to people controlling Libyan accounts, then we are NOT talking “interest and dividends”.
This would clearly be money from the frozen accounts. And that would be a major violation of International Law. There is something rotten in the Kingdom of Belgium.
UPDATE (November 04 2018) — In their final Report, the UN Panel of Experts for the Libya Sanctions Committee said Belgium’s Euroclear Bank had been in “non-compliance with the [UN-Libya] asset freeze”.
The report states that the bank had allowed for interest payments from the frozen funds of the former Gaddafi regime to be made available to bank accounts of the Libyan Investment Authority in third countries until 23 October 2017.
So, let me summarize the facts as we understand them today.
When it was discovered earlier this year that billions were missing from the ‘Gaddafi frozen fund’, Belgian Finance minister denied the allegation. Quite clearly, he did not tell the truth.
When it was confirmed that the money earned from this fund (Interest, dividends, etc..) had indeed been paid, Belgian authorities argued that, according to their own interpretation of the UN Resolution, it was not illegal because these earnings were not frozen as they had been generated after September 2011.
But, as the experts pointed out, there is no need to interpret the text of the UN Resolution because it is very clear that the earning generated by the fund are also frozen.
“The resolution 1970 (paragraph 20 ) still applies to assets that are held outside Libya frozen as of 16 September 2011, which
includes earnings arising from these assets after 16 September 2011.”
Now that it is very clear that money was illegally paid from these frozen accounts, Belgian Authorities argue that other countries are doing it too!
As Christopher Hitchens once told me, “They are doing it too” should be a line for the prosecutor, never for the defence.
Facts — BNP Paribas Fortis held €43 million, while ING, KBC and Euroclear Bank held €376 million, €869 million and €12.8 billion respectively in Libyan assets. The total value of the fund has been estimated at about $35 billion in December 2010.
“The LIA’s funds are locked in at least four bank accounts managed by Euroclear. By examining copies of Euroclear statements from 2013, POLITICO found that the frozen funds invested in shares before 2011 have risen in value to €14 billion. Those stocks include holdings in big Italian companies such as the oil giant ENI, the bank Unicredit and the engineering company Finmeccanica, among others.”
What for? — The money was channeled to mystery beneficiaries behind accounts managed by the Libyan Investment Authority (LIA). The payments were made between 2011 and 2017.
While it is not known how the profits were used, an expert believes there is overwhelming evidence to suggest the funds were used in arms and human trafficking crimes. Robert Wtterwulghe, professor at UC Louvain, said:
“In this report, we realise that there is a problem of arms trafficking to feed factions.
“There is a whole market that aims to bring migrants and to engage Nigerian prostitution networks.
“It is a mafia enterprise but relies on all the militias in question – they receive external funds.”
Who made the decision? — Belgian foreign Minister Didier Reynders denies any involvement in the decision to release funds.
“It’s the responsibility of the finance ministry and I am no longer there since December 6, 2011. I have taken no decision in this areas.”
A Belgian finance minister spokesman argues that it was a question of interpretation.
“In this matter Belgium has acted in coordination with its European counterparts in the application and in accordance with guidance shared and approved by said counterparts within the RELEX group meetings.
“As has been highlighted by the UN panel of experts on Libya Security Council Resolution 1973 (2011) there is a need to clarify the interpretation.”
A spokesperson for the Council of the EU said it is not for the Council “to express a view” on how a country in the EU interprets the EU’s sanctions regime against Libya.
Actually, the UN experts concluded that the text was very clear and needs no additional explanations.
Blast from the Past — Reynders was quoted by the Belgian daily La Libre in 2011 arguing that Belgian companies should be paid their dues from contracts made with the Gaddafi regime before sanctions kicked in.
“What we have generally done on past occasions is to see what could be unblocked by the Treasury to pay Belgian companies,” he said.
BELGIUM — €10bn Missing From Gaddafi Frozen Accounts
BELGIUM — €10bn Missing From Gaddafi Frozen Accounts [UPDATE II : Money Used to Fund Terrorist Groups]
BELGIUM — €10bn Missing From Gaddafi Frozen Accounts [UPDATE III : Belgian FM Lied to Libyan Authorities]
One Year Ago — BELGIUM : €10bn Missing From Gaddafi Frozen Accounts