http://voanews.com/english/archive/2004-07/a-2004-07-20-3-1.cfm

US Congress Pressed to Tighten Anti-Corruption Laws in Wake of Equatorial Guinea Oil Scandal
By Deborah Tate
Washington

20 July 2004

U.S. lawmakers are considering tightening anti-corruption laws after a Senate report this month found that a prominent Washington bank helped top officials of the West African nation of Equatorial Guinea steal hundreds of millions of dollars in oil revenues.

The Senate Permanent Subcommittee on Investigations has been probing the corruption case involving Equatorial Guinea and its oil revenues for much of the past year.

The panel's report found that Riggs Bank helped government leaders in Equatorial Guinea siphon oil revenues to accounts set up for them in Washington.

The West African nation, where significant amounts of oil were discovered in the 1990's, has been cited by the U.S. State Department for human rights abuses, corruption, and diversion of oil revenues to government officials.

Beginning in 1995 until earlier this year, Riggs oversaw as many as 60 accounts containing as much as $700 million, making Equatorial Guinea its largest single customer. Some were government accounts, while others were the private accounts of President Teodoro Obiang Nguema, other government officials, and their families.

The Senate report says millions of dollars in the government accounts, which should have gone to help impoverished Equatorial Guineans, were instead funneled to off-shore tax shelters, with help from Riggs officials.

At a hearing on the matter at which current and former bank officials appeared last week, Senator Carl Levin, a Michigan Democrat, was clearly outraged. "Somehow there has to be a conscience here. Aren't you troubled?," he said.

The report describes one incident in which the bank manager of the country's accounts, Simon Kareri, brought a 27 kilogram suitcase full of cash into Riggs to make a deposit into President Obiang's account.

Mr. Kareri, who was fired in January, refused to testify at last week's hearing," he said. "Mr. Chairman, there is nothing I would like to do more than answer your questions today. However, I must heed the advice of my counsel and invoke my fifth amendment rights under the Constitution and refuse to answer the question," he said.

Senators were angered that bank officials never reported any suspicious financial transactions involving Equatorial Guinea.

Lawrence Hebert, president and chief executive officer of Riggs Bank, blamed a lack of an internal system to monitor and identify such suspicious activity. It is an assertion that Senator Levin found ridiculous.

"Without the system, without the upgrade compliance department, we would have been unable to produce that information and provide the necessary oversight," he said. "That is what we were working with the Office of the Comptroller of the Currency on."

"First of all Mr. Hebert, you do not need a computer system to realize suspicious activity when you have sixty pounds of cash that are being walked into the door with a suitcase . . .

- - VOA News

http://www.state.gov/www/global/human_rights/1998_hrp_report/eqguinea.html

U.S. Department of State
Equatorial Guinea Country Report on Human Rights Practices for 1998
Released by the Bureau of Democracy, Human Rights, and Labor, February 26, 1999.

EQUATORIAL GUINEA

Equatorial Guinea is nominally a multiparty constitutional republic, but in reality power is exercised by President Teodoro Obiang Nguema through the small Mongomo clan of the majority Fang ethnic group, which has ruled since the country's independence in 1968.

. . . President Obiang exercises control over the police and security forces through the Minister of the Interior, who serves as president of the National Electoral Board as well. The security forces committed numerous, serious human rights abuses.

The majority of the population of approximately 470,000 live by subsistence agriculture, supplemented by hunting and fishing.

. . . Substantial oil deposits were discovered in 1995, and exploitation began in 1996.

. . . The Government's human rights record remained poor.

. . . There were reports of extrajudicial killings . . .

. . . Other principal abuses by the security forces included: Torture; physical abuse of prisoners; beating and mutilation of detainees; arbitrary arrest and detention; extortion from prisoners; searches without warrants, looting of private homes and the raping of female residents . . .

. . . Senior members of the Government allegedly involved in the systematic torture of detainees have not been prosecuted. Prison conditions remained life threatening. Prisoners often were subjected to torture in order to extract confessions.

. . . The Government engaged in the illegal capture and involuntary repatriation of its citizens living abroad.

. . . Abuse of workers' rights was particularly serious in the oil industry.

. . . Police reportedly urinated on prisoners, kicked them in the ribs, sliced their ears with knives, and smeared oil over their naked bodies in order to attract stinging ants. The President and senior government officials acknowledged that the security forces had committed excesses, but attributed them to what were allegedly rogue elements. However, according to credible reports, this torture was approved at the highest levels of the Government and was directed by the chief of presidential security, Armengol Ondo Nguema, who is also President Obiang's brother. Ondo Nguema allegedly taunted prisoners by describing the suffering that they were about to endure.

. . . In July two members of the ruling Mongomo clan and of the banned Democratic Republican Forces (FDR) Party, former Education Minister Felipe Ondo and former Planning Minister Guillermo Nguema, were convicted of libeling the State and sentenced to 30 months' imprisonment. In November 1997 security forces had repatriated them forcibly from Gabon with the consent and complicity of the Gabonese Government (see Section 2.d.). The basis of the libel charge was a letter that the two had circulated after being repatriated from Gabon, in which they stated that they expected to be arrested soon . . .

- - Bureau of Democracy, Human Rights, and Labor
- - U.S. Department of State, February 26, 1999