WASHINGTON, DC (Feb. 5, 2010) – EG Justice welcomes the findings of the US Senate Permanent Subcommittee on Investigations' hearing on foreign corruption in finance in the United States. The subcommittee’s 330-page bipartisan report documents damning evidence against corrupt foreign officials and the US real estate, legal, and financial professionals who have aided them in funneling millions of dollars in ill-gotten funds into US financial institutions.
In the case of Equatorial Guinea, the president’s son, Teodoro Nguema Obiang (Teodorin), moved more than $110 million dollars of suspect funds into US bank accounts with the aid and negligence of US legal and real estate professionals; including:

• how an escrow agent completed the purchase of a $38.5 million Gulfstream jet without verifying the source of the funds; and,

• how a real estate agent facilitated the purchase of a $30 million house, without undertaking any due diligence to verify that the funding was legitimate.

“There is no doubt that corruption by high-ranking government officials, as identified in the subcommittee report, undermines rule of law, democracy, and the fight against poverty, as has been demonstrated time and again in Equatorial Guinea,” said Tutu Alicante, executive director of EG Justice. “If the US government truly wants to promote good governance and rule of law in Africa, as President Obama stated this summer in Accra, it is critical that his administration eliminates the loopholes and mechanisms that facilitate foreign corruption within the US.”

“Keeping Foreign Corruption out of the United States: Four Case Histories”, released by chairman Sen. Carl Levin and ranking member Sen. Tom Coburn, identifies how foreign officials in Gabon, Nigeria, Angola, and Equatorial Guinea, skirted US anti-money laundering controls through a network of US lawyers, realtors, shell companies, and banking institutions, laundering millions of dollars into the United States:

This hearing by the US Senate is a step in the right direction, and EG Justice calls on the US government to adopt the subcommittee’s recommendations, which include implementing stronger controls on the accounts of “politically exposed persons,” requiring US corporations to identify their beneficiary owners, and better enforcing Presidential Proclamation 7750 which prohibits corrupt foreign officials from obtaining visas.

Equatorial Guinea has the highest GDP per capita in Africa, yet poverty and human development indicators remain abysmally low. Nearly 77 percent of the population lives below the poverty line, and infant and child mortality have in fact worsened since the discovery of oil in the mid 1990’s. Meanwhile, Teodorin Obiang spent nearly double the country’s 2007 education budget on mansions, exotic cars, and other luxury items between 2004 and 2007.

For more information, contact:

Tutu Alicante (615) 479 0207 or tutu@egjustice.org

Today in Washington, D.C., this hearing:

Keeping Foreign Corruption Out of the United States: Four Case Histories
Permanent Subcommittee on Investigations
Thursday, February 4, 2010
09:30 AM
Dirksen Senate Office Building, room 342

The Permanent Subcommittee on Investigations has scheduled a hearing, "Keeping Foreign Corruption Out of the United States: Four Case Histories," on Thursday, February 4, 2010, at 9:30 a.m., in Room 342 of the Dirksen Senate Office Building.

The Subcommittee hearing will examine how some politically powerful foreign officials, their relatives, or close associates – referred to in international agreements as “Politically Exposed Persons” or PEPs – have used the services of U.S. professionals and U.S. financial institutions to bring millions of dollars in suspect funds into the United States to advance their interests. Four case histories will illustrate how some PEPs have used U.S. lawyers, realtors, escrow agents, lobbyists, bankers, and others to circumvent U.S. anti-money laundering and anti-corruption safeguards. It will also look at how some U.S. professionals have actively helped PEPs avoid bank scrutiny or facilitated suspect transactions with no questions asked. The hearing will also examine whether U.S. policies and practices to combat foreign corruption and money laundering need strengthening. Witnesses will include government agencies, including the State Department, Immigration & Customs Enforcement (ICE), and Financial Crimes Enforcement Network (FinCEN), as well as lawyers, a realtor, and representatives of financial institutions.
A witness list will be available Tuesday, February 2, 2010.

Witnesses
Panel 1
MICHAEL JAY BERGER
Attorney for Equatorial Guinea Cabinet Minister Teodoro Obiang Nguema Mangue

GEORGE I. NAGLER
Attorney for Equatorial Guinea Cabinet Minister Teodoro Obiang Nguema Mangue

JEFFREY C. BIRRELL
Registered Agent for the Republic of Gabon
The Grace Group

Panel 2
NEAL BADDIN
Realtor for Equatorial Guinea Cabinet Minister Teodoro Obiang Nguema Mangue

BRENDA K. COBB
Vice President
Insured Aircraft Title Service, Inc.

WILLIAM J. FOX
Senior Vice-President and Global Anti-Money Laundering and Economic Sanctions Executive
Bank of America

WIECHER H. MANDEMAKER
Director, General Compliance, Personal Financial Services, Anti-Money Laundering Compliance
HSBC Bank USA, N.A.

Panel 3
THE HONORABLE DAVID T. JOHNSON
Assistant Secretary for International Narcotics and Law Enforcement Affairs
U. S. Department of State

JANICE AYALA
Assistant Director, Office of Investigations
Immigration & Customs Enforcement (ICE)

JAMES H. FREIS, JR.
Director
Financial Crimes Enforcement Network (FinCEN)