In France, can the preliminary investigation opened in 2011 against the Mubarak clan for organised money laundering and corruption yield anything? Transparency International France, a civil party in this case, wants to reopen the investigation.
The European Council’s decision is no gift to the Egyptian people who, with each year that passes, are less likely to recover the $70bn allegedly embezzled by the Mubarak clan during his reign – and which has been scattered throughout the world.
In all 27 EU member states, relatives of the overthrown president could now regain direct control of their assets at a time when Egypt is celebrating the 10th anniversary of the Arab Spring, which precipitated the fall of a regime that had been accused of kleptocracy.
Risk of asset leakage
The value of the assets located in Europe is difficult to estimate. Only Spain had made public the freezing of nearly €28m, seven properties and five luxury cars in 2011. France, the UK (then a member of the European Union) and Cyprus, which are known to have harboured similar assets and funds, have never communicated any information regarding the frozen or seized assets.
However, according to several news sources, the Mubarak family and their entourage own several flats in Paris worth millions of euros. Furthermore, they also own several bank accounts, notably with the Audi France bank, as was revealed in 2019.
Not content with being able to enjoy all of these assets in France and the rest of Europe, the interested parties are now threatening, through their lawyer, to take legal action against the European Council itself for the freeze imposed over the past 10 years.
Risk of leakage of allegedly ill-gotten assets, legal threats – while the Mubarak clan is once again in a position of strength – the European Council feels the financial sanctions have “fulfilled their objective”, while paradoxically acknowledging a “misappropriation of Egyptian public funds.” During the freezing process, however, several media outlets had investigated whether the freeze was being properly enforced in the UK and its dependencies, as well as in France.
Apparent breaches of the French freeze
As early as 2012, the BBC had established the presence of nearly 10 companies that remained active in London, only one year after the freeze was introduced in the UK. The Panama Papers scandal also revealed that the bank Crédit Suisse, which manages an offshore company owned by one of the sons of the former Egyptian president, had taken financial action that could run counter to the freeze. We had also reported how this company had disappeared from the British Virgin Islands’ commercial register without a trace at the end of 2016, suggesting a possible infringement.
Another part of our investigation established certain irregularities concerning a property worth several million euros located in the 8th arrondissement of Paris. Neighbours’ testimonies referred to “limousine balls” every weekend, extension works and general occupation of the property, in apparent breach of the then ongoing freeze.
In other words, not only does the lifting of the freeze now make it possible to transfer some of these assets, but the freeze itself did not seem to be properly enforced in at least two cases. These were reprehensible acts from the point of view of the law and on which the French Ministry of Finance (Bercy), which was in charge of implementing the freeze, did not wish to comment.
Although asset freezing measures and investigations into ill-gotten gains in France are the responsibility of two separate administrations, they serve a common purpose in fighting corruption.
What future for the French investigation?
While the Parquet National Financier, PNF (the National Financial Prosecutor’s office) will have to decide on the conditions for acquiring the assets, which are suspected of being the result of money laundering, Bercy has ordered the freezing of these assets to ensure that they may not be used, transferred, modified or resold. This will remain the case until PNF’s vice-prosecutor Dominique Blanc, the prosecutor in charge of this investigation, has delivered his verdict.
Does the PNF feel that releasing these French assets concludes this preliminary investigation into the Mubarak clan that has been underway for 10 years in France? According to the prosecutor’s secretariat, “assets frozen or seized within the framework of the ongoing judicial investigation are likely to be returned to the country looted in the event of a final judgment.”
While this answer indicates that seizures linked to the judicial proceedings remain possible, it does not answer the question of what occurs in the event of the flight of French assets.
Why did Bercy not maintain the national freeze in order to support the investigation until it was concluded? Silence from the Ministry of Finance. A diplomatic source linked to the Quai d’Orsay indicated, as if echoing the European Council, that the freeze had served its purpose, without commenting further.
After the Mubaraks’ assets in Switzerland were unfrozen in 2017, the dictator’s sons were acquitted from graft charges in Egypt in 2020, and the UK and all European countries’ assets were unfrozen in March, one of the last procedures to be held is the French investigation, which, without a bilateral partner, will have to be concluded independently of European sanctions or Egyptian legal aid.
According to Patrick Lefas, president of Transparency International France, it is time for the case to find “a new momentum.”
Transparency International France wants to reopen the case
Lefas feels that the apparent violations regarding the freezing of French assets, are indeed “anomalies.” As for the lifting of the European freeze, the anti-corruption NGO regrets that there is “not much left to do.” The risk of “haste”, as well as the flight of assets out of France, is very present.
Nevertheless, Lefas insists that the PNF may offer a new perspective on this case. “The French justice system has the opportunity today to continue the investigation on the Egyptian section without relying on the proceedings conducted in Egypt, following the examples of the Obiang and Assad cases in which the leaders and former leaders prosecuted were convicted of money laundering,” he says.
In other words, Egyptians can still hope for a favourable conclusion to this investigation, and as the PNF also mentioned, the eventual recovery of the assets seized and frozen within the context of this investigation. Lefas has undertaken to determine what follow-up Transparency International France may provide to the case.
This could take the form of an appeal to the French Ministry of Foreign Affairs and the National Financial Prosecutor’s Office to move the case forward, according to Transparency International. “It would indeed be paradoxical, at a time when Transparency is working with elected officials to set up a more efficient and transparent asset recovery system, if light was not shed on this case,” says Lefas.
The NGO has been working since 2019 on an overhaul of the asset recovery system, a key element in the ill-gotten gains cases. This was through a first bill tabled in 2019 by Senator Jean-Pierre Sueur and voted in the Senate in December 2020, but also in the National Assembly, with the adoption on first reading of a text aimed at improving the transparency and traceability of funds redistributed to despoiled populations, on 21 February 2021.
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