Saudis Said to Use Coercion and Abuse to Seize Billions

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  • Saudis Said to Use Coercion and Abuse to Seize Billions - The New York Times

    https://www.nytimes.com/2018/03/11/world/middleeast/saudi-arabia-corruption-mohammed-bin-salman.html?hp&action=click&pgtype=Hom

    RIYADH, Saudi Arabia — Businessmen once considered giants of the Saudi economy now wear ankle bracelets that track their movements. Princes who led military forces and appeared in glossy magazines are monitored by guards they do not command. Families who flew on private jets cannot gain access to their bank accounts. Even wives and children have been forbidden to travel.

    In November, the Saudi government locked up hundreds of influential businessmen — many of them members of the royal family — in the Riyadh Ritz-Carlton in what it called an anti-corruption campaign.

    Most have since been released but they are hardly free. Instead, this large sector of Saudi Arabia’s movers and shakers are living in fear and uncertainty.

    During months of captivity, many were subject to coercion and physical abuse, witnesses said. In the early days of the crackdown, at least 17 detainees were hospitalized for physical abuse and one later died in custody with a neck that appeared twisted, a badly swollen body and other signs of abuse, according to a person who saw the body.

    In an email to The New York Times on Sunday, the government denied accusations of physical abuse as “absolutely untrue.”

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    To leave the Ritz, many of the detainees not only surrendered huge sums of money, but also signed over to the government control of precious real estate and shares of their companies — all outside any clear legal process.

    The government has yet to actually seize many of the assets, leaving the former detainees and their families in limbo.

    One former detainee, forced to wear a tracking device, has sunk into depression as his business collapses. “We signed away everything,” a relative of his said. “Even the house I am in, I am not sure if it is still mine.”

    As the architect of the crackdown, Crown Prince Mohammed bin Salman, prepares to travel to the United States this month to court American investment, Saudi officials are spotlighting his reforms: his promise to let women drive, his plans to expand entertainment opportunities and his moves to encourage foreign investment. They have denied any allegations of abuse and have portrayed the Ritz episode as an orderly legal process that has wound down.

    But extensive interviews with Saudi officials, members of the royal family, and relatives, advisers and associates of the detainees revealed a murkier, coercive operation, marked by cases of physical abuse, which transferred billions of dollars in private wealth to the crown prince’s control.

    Corruption has long been endemic in Saudi Arabia, and many of the detainees were widely assumed to have stolen from state coffers. But the government, citing privacy laws, has refused to specify the charges against individuals and, even after they were released, to clarify who was found guilty or innocent, making it impossible to know how much the process was driven by personal score settling.

    Part of the campaign appears to be driven by a family feud, as Crown Prince Mohammed presses the children of King Abdullah, the monarch who died in 2015, to give back billions of dollars that they consider their inheritance, according to three associates of the Abdullah family.

    And although the government said the campaign would increase transparency, it has been conducted in secret, with transactions carried out in ways that avoid public disclosure, and with travel bans and fear of reprisals preventing detainees from speaking freely.

    Most people interviewed for this article spoke on the condition of anonymity to avoid the risk of appearing to criticize Crown Prince Mohammed.

    The government said in its email that “the investigations, led by the Attorney General, were conducted in full accordance to Saudi laws. All those under investigation had full access to legal counsel in addition to medical care to address pre-existing, chronic conditions.”

    The government, and several Saudi officials contacted separately, declined to answer further questions about the crackdown.

    They have argued, however, that it was a necessarily harsh means of returning ill-gotten gains to the treasury while sending a clear message that the old, corrupt ways of doing business are over. And they have defended the process as a kind of Saudi-style plea bargain in which settlements were reached to avoid the time and economic disruption of a drawn-out legal process.

    In a separate statement on Sunday announcing new anti-corruption departments in the Attorney General’s office, the government said that King Salman and Crown Prince Mohammed “are keen to eradicate corruption with utmost force and transparency.”

    But the opaque and extralegal nature of the campaign has rattled the very foreign investors the prince is now trying to woo.

    “At the start of the crackdown they promised transparency, but they did not deliver it,” said Robert Jordan, who served as American ambassador to Saudi Arabia under President George W. Bush. “Without any kind of transparency or rule of law, it makes investors nervous that their investments might be taken and that their Saudi partners might be detained without any rationale to the charges.”

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