Senhor Alvaro and the Need for a Commission of Inquiry

The quasi-unanimous outcry of the country and Opposition parties has been for a full-fledged commission of inquiry to understand what happened, how it happened and how to prevent such levels of dysfunctioning arising again

The events that have conspicuously marred the celebrations of 50 years of independence and national sovereignty are still haunting ordinary citizens, government and its regulatory or its inquisitive institutions, the National Assembly members and the body politic in its entirety. They have been amply commented upon throughout the month straddling the ides of March. Behind every twist of this saga and its convolutions, including the shaggy confrontation between Government House and the State House at Reduit, lays the shadowy spectre of one dubious investor, Senhor Alvaro Sobrinho.

It would be sadly trivial to recall here the numerous African dictatorships or long-serving Presidents who have continuously hijacked their country’s wealth, diverted and stashed in compliant overseas jurisdictions and accounts. The Angolan President José Eduardo dos Santos has been emblematic of that voracious breed and only resigned last year after signing decrees making sure his designated successors would have a tough time suing him personally or his family. Meanwhile, more than 36% of the Angolan population lives on less than $2 a day, according to the World Bank.

Senhor Alvaro, the Angolan ex-President’s nephew, was an integral part of the tiny kleptocratic elite, involving children, close family and crony circle, that surrounded dos Santos as they collectively ransacked oil and mineral revenues and exploitation rights to amass colossal personal fortunes. That he has been accused of cleverly ripping off 600-800 mUS and bleeding Portugal’s second bank (BES, Espirito Santo) to bankruptcy is not a matter of conjecture in Portugal and Switzerland although Senhor Alvaro has not been condemned yet anywhere.

Complex financial scams take years for resolution, when prosecutors or judges are not simply bought off, as the accusators say. What is known is that Portuguese taxpayers had to bail out the BES Bank to the tune of 4.5 billion Euros, as a result of which it was split into a solvent part (the retail arm, renamed Novo Banco) and the rotten Investment Banking arm which tried hard to find a re-buyer at scrap value.

The PM may have been entirely justified to immediately call the ex-President move to set up a commission of inquiry illegal, but, by the same token, will face intense public disappointment should he avoid appointing himself a credible full-fledged commission of inquiry on the ramifications of Senhor Alvaro’s implantation and activities here. It is a matter of national interest when the international financial and investor community, the OECD, the EU, the IMF-WB twin sisters, the rating agencies, the foreign embassies and consulates are keen observers of the morass and have us on their radar…”


The banking crash sent jitters that spread like wildfire throughout the OECD, the IMF, the WB and the international banking community. So much was already established late in 2014 if we go by international news sites and bulletins. This therefore, and probably much more, would have been known end 2014 by our own Board of Investment, the Financial Services Commission, the Bank of Mauritius or even by any of our big investment or financial advisory companies. That is the period when Senhor Alvaro, already under pressure to find a convenient getaway, is reported to have sought here a friendly investment or banking destination for setting up shop and ‘investing’ his colossal questionable wealth. His requests to invest or transfer his fortune were, it appears, resolutely turned down then by our authorities.

Benevolent treatment and welcoming arms

With the political change of guards and the taking office of the so-called Lepep political alliance in December 2014, it is now clear that Senhor Alavaro received an exceptionally benevolent treatment and welcoming arms in high quarters of our politico-administrative nexus. The questions relating to his implantation have been raised since March 2017 around his property investments while our ex-President’s personal involvement and that of the Reduit Chateau in the Senhor’s adventures in Dodoland were being exposed. Those activities and the ex-President were stoutly defended then, in Parliament and outside, by the governing alliance of MSM-ML-transfuges.

One year later, the press has to be commended for more revelations regarding the ex-President’s facilitator role and the Platinum Card scandal, but public opinion is particularly outraged by the Senhor’s involvement in what seems to have become his playground. The current outcry is immeasurably stronger than events of last year had raised: one could almost say the ex-President’s tastes and conduct might have been unacceptable, requiring destitution as the PM and all political parties pointed out, but was a relatively benign sign of dereliction.

Without in any way condoning the ex-President’s actions — authorised and justified, one must point out by Government top-brass until the latest episode of the Alvaro scandal broke out –, many query what’s a Rs1million Platinum card issue when upmarket limousines and luxury villas here and overseas are being mentioned at fifty or a hundred times that scale? When free first-class travel and perks are being dished out to servants of the cause? When the VVIP red carpet is extended by both Reduit and Government House to the Senhor at each airport transit here?

When career functionaries at key positions find it normal to hop into the waiting bed of those businessmen and investors they assisted while in office? When neither ICAC, nor the FIU have found it fit to complete any timely investigations, even when the Solicitor-General raised some alarm bells? When the FSC, from which several key Board members resigned, has, since March 2017, been made to look like castrated canards? When the Deputy Prime Minster (and leader of the ML), has personally vouchsafed the Senhor and defended the ex-President for as long as he could?…

Those and many other unanswered questions obviously reflect a quest for clarity concerning the roles and responsibilities of the politico-administrative nexus: the relevant Ministries tasked with overseeing financial and national development, those in the front-line to keep untarnished the hard-fought reputation of our financial and offshore services jurisdiction, the financial regulatory bodies, the investigative institutions like CCID or ICAC and the political godfathers who might have oiled the machinery.

A reflection of disbelief

The questions are a reflection of disbelief that a sulfurous Senhor who in 2014 was for very good reasons turned away by the BOI, the FSC or the PMO, could have been granted full and privileged accesses, allowed to buy properties and operate investment banks that could channel his massive funds back into the international monetary circuit. The Senhor may be yet uncondemned but international press in Europe have reported recently a renewed energetic prosecution in Portugal and a freezing of 160m Swiss franc of his assets in Switzerland. The questions are a reflection of disbelief that a single controversial investor with enough of a massive cash-stash could have so easily derailed all our financial and regulatory institutions, higher-level administrations and body politic. The quasi-unanimous outcry of the country and Opposition parties has been for a full-fledged commission of inquiry to understand what happened, how it happened and how to prevent such levels of dysfunctioning arising again.

That cannot be accomplished by government’s standard attitude of “let institutions investigate”, in particular the ICAC, whose operational opacity and narrow mandate cannot suffice for the multiplicity of questions raised in the wake of the Senhor’s activities, his comparses and compradores — quite possibly his ‘facilitators’ here. The ICAC as far as the public is aware has not batted an eyelid throughout the past year, despite waves of revelations that should have had it running on its own steam to probe further. In the ex-President’s parting and, by most legal accounts, ill-advised communique, Ameenah Gurib-Fakim did however provide numerous grounds and possible terms of reference for such a commission of inquiry.

The PM may have been entirely justified to immediately call it illegal, but, by the same token, will face intense public disappointment should he avoid appointing himself a credible full-fledged commission of inquiry on the ramifications of Senhor Alvaro’s implantation and activities here. It is a matter of national interest when the international financial and investor community, the OECD, the EU, the IMF-WB twin sisters, the rating agencies, the foreign embassies and consulates are keen observers of the morass and have us on their radar. That the laboriously acquired reputation of our financial services jurisdiction is at stake needs no spelling out.

We have already lost the DTAA and fragilised the offshore and financial services sectors which our global competitor jurisdictions are no doubt alive to. Neither the conglomerate private sector looking to shore up their Smart Cities with credible investors other than property buyers, nor those businesses in constant touch with international banks, consultants and investors can be entirely happy with the current imbroglio, both around the Senhor’s affairs, the political implications and the impact on the general investment mood.

Financial corruption and fraud

The Senhor’s affairs here and their facilitation raise certainly far more questions about our country’s functionings than simply the malversations that may have taken place: constitutional, legal, institutional and administrative aspects have been flagged elsewhere. It is no solace to know that we are not alone in the struggle for reigning in financial corruption and fraud. The Centre for Crime and Justice Studies (UK) in a study published in May 2016 raised “the question of how corrupt British government practices are, and challenge the belief that such activities are rare in the ‘mother of all democracies’”.

The Open Society Foundation (US) in a detailed study (2016) of anti-corruption mechanisms in West African states, observed that the dedicated structures (like ICAC) approach initially favoured by international donor institutions has dismally failed to live up to expectations or to stem corrupt practices. It highlights the necessity of a shift towards transparent and accountable mechanisms. “As a newer wave of citizen-led transparency and accountability movements emerge and are increasingly becoming catalysts for meaningful changes, anti-corruption agencies are under greater scrutiny and questions are being raised about their utility and efficacy.”

As we weigh 50 years of nationhood, the population has acknowledged the combined failures of FSC-FIU-ICAC to stem financial fraud, scams and corruption despite the billions spent on their upkeep. There is little to add concerning ICAC’s image and perception in all non-government quarters and the general public. Should government avoid a proper commission of inquiry on Senhor Alvaro’s dealings which could analyse all elements, publicly and transparently and with all the guarantees its Act affords?

The risks of the spotlight shifting to the PM’s reluctance to take such a course of action could have an unforeseeable impact on public perceptions. In political terms, it could become unmanageable for the MSM to give the impression of covering up for its junior alliance partner (ML) for reasons unknown. Unless an alternate strategy is already being cooked up…

 

* Published in print edition on 30 March 2018

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