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US authority seizes laundered Abacha funds

Monday, 11 August, 2014

The US Department of Justice has seized nearly half a billion dollars hidden in bank accounts around the world by the former Nigerian head of state Sani Abacha and his colleagues.

The USDoJ was granted the confiscation order last week in a district court in Washington DC. It is the result of an application filed by the department in November 2013, alleging that General Abacha, his son Mohammed Sani Abacha, their associate Abubakar Atiku Bagudu and others misappropriated more than USD625 million from the Nigerian state.

Abacha embezzled billions of dollars from Nigeria's central bank after seizing power in 1993, until his death in 1998. He and his confederates laundered the money through bank accounts in various countries, especially Jersey and Switzerland, before investing it in US securities, said Assistant Attorney-General Leslie Caldwell.

According to the USDoJ, some of the embezzlements were performed by extracting public funds from the Central Bank of Nigeria by claiming that the money was necessary for national security. The funds were then withdrawn in cash and shifted overseas. Another ploy was to cause the Nigerian government to buy back its own bonds at inflated prices from a company controlled by Bagudu and Mohammed Abacha. The Abacha cabal are also accused of extorting USD11 million from a French company and its Nigerian affiliate in connection with payments on government contracts.

The US court judgment is made up of USD303 million in two bank accounts in Jersey; USD144 million in two bank accounts in France; and three bank accounts in the UK worth at least USD27 million.

The USDoJ is also preparing claims to a further USD148 million in four investment portfolios in the UK. The UK banking system also played a central role in aiding the Abacha cabal, having moved about USD1.3 billion of their funds in the years up to 2001.

The Abacha kleptocracy (as the USDoJ calls it) also made much use of Swiss bank accounts. The Swiss authorities have since returned USD700 million of stolen funds to Nigeria, though the process took at least five years.

Jersey has been cooperating in the hunt for Abacha's assets since before 2003, when it worked with the Nigerian government, the US authorities and countries across Europe to repatriate USD160 million of Jersey-held assets to the Nigerian authorities.

In June 2010, one of Abacha's confederates, Raj Bhojwani, was jailed for six years by Jersey's Royal Court. Bhojwani, an Indian national, had laundered GBP122 million of Abacha's illicit funds through a Bank of India account on the island. Some of this money was later confiscated and repatriated to the Nigerian government. However the latter's efforts to recover EUR175 million hidden in Liechtenstein by the Abacha family continued to be the subject of a long legal battle, though the Liechtenstein authorities agreed to confiscate the funds from the Abacha bank account.

Sources