3 June 2017

Africa: Montreal - the Latest Hotspot for Africa's Rulers to Keep Their Wealth?

Photo: African Arguments
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analysis

A new African Arguments investigation has found that politically-exposed African nationals hold Canadian real estate worth several millions of dollars.

The study, conducted in partnership with the Journal de Montréal and Le Monde Afrique, reveals over a dozen individuals who have invested nearly $26 million in Canadian real estate, often without a mortgage.

The source of the funds used to buy these properties could be legitimate. But the sales should have raised red flags because of the public positions of the individuals involved or because of their association with deals that have raised suspicion.

Buying bricks and mortar abroad has long been a strategy of the rich to diversify their assets.

Typically, the likes of France, US and UK have been the go-to places to buy up expensive property. Not all of it uses clean money. In 2016, a UK parliamentary committee estimated that a shocking $150 billion is laundered in London's real estate market every year. But in recent years, luxurious flats owned by families of African leaders have been seized in each of these countries.

This seems to have led some to look further afield.

"They will diversify their investments according to only one criteria, which is the legal security offered by specific territories," says William Bourdon, lawyer for Sherpa.

Sherpa is the NGO behind the "ill-gotten gains" case in France in which the rulers of Gabon, Congo-Brazzaville and Equatorial Guinea stand accused of laundering money in luxurious French properties.

According to Marc Guéniat, a researcher at the Swiss NGO Public Eye, France has historically been the favoured location for investment amongst the rulers of francophone Africa, but incidences such as the "ill-gotten gains" case have changed this.

"Logically, these rulers look for other destinations," he says. "As a francophone region, Québec is an interesting alternative."

In Québec, the origins of funds invested in real estate don't seem to raise too many questions. A recent Transparency International report highlighted the country's weak anti-money laundering regulations in the real estate sector.

In theory, both real estate brokers and financial entities such as banks are responsible for detecting money laundering in Canada. They are meant to notify suspicious transactions to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) that can, in turn, inform the police.

But between 2003 and 2013, in which there were over 5 million real estate sales, FINTRAC received just 279 suspicious transactions warnings. This rate increased slightly following educational efforts by FINTRAC, although it remains relatively low.

Moreover, in the dozen administrative penalties that FINTRAC has levied against brokers who failed to properly identify clients since 2008, the fines have averaged under $6,900. This pales in comparison to sales sometimes worth millions of dollars.

Brokers that fail to meet their legal responsibilities also face criminal sanctions, but it is not clear how many such cases have been investigated and brought to justice. The Canadian royal police did not reply to our questions.

Below is an interactive map showing the value and approximate area of the properties owned by politically-exposed African nationals that our investigation uncovered. The dots are within a kilometer of the properties to give a sense of the broader neighbourhood, but they do not represent their exact locations.

The map is information about the individuals in question.

Congo-Brazzaville

Wilfrid Nguesso is the nephew of Denis Sassou-Nguesso, the president of Congo-Brazzaville who has held an often violent grip on power for a total of 32 years. Over the past decade, Wilfrid has been trying to migrate to Montreal, but the Canadian authorities have forbidden him entry on the grounds that he allegedly belongs to a "criminal organisation" that has embezzled Congo's public funds.

Wilfrid and his wife bought a house in Montreal worth over $730,000 without a mortgage in 2007. He did not reply to our calls for comments.

Voltaire Brice Etou Obami is an accountant and businessman close to the Nguesso family. He is named in a note by the French anti-laundering agency, Tracfin, due to his business deals with Catherine Ignanga. Ignanga used to be President Sassou-Nguesso's sister-in-law and is being investigated by Tracfin. Obami is not under investigation and told us that he does not know about Ignanga's dealings that are being scrutinised.

In 2014, Obami invested over $410,000 in two Montreal hotel rooms. His children study in Canada and he says he has applied for an immigration visa. According to him, the funds for the rooms came from his wife, who he says made profits from the real estate industry in Africa.

Jean Jacques Bouya is a member of Congo's presidential family. He is being investigated by Tracfin. In Congo, he oversees millions of dollars in public funds as the Minister of Spatial Planning and Major Projects. He was previously chief of the agency in charge of large public works, the DGGT (Délégation générale des grands travaux).

According to a document from the French financial fraud police that we procured, the DGGT under Bouya made several transfers to bank accounts in San Marino between 2007 and 2013. All these accounts were held by Philippe Chironi, a close associate of Congo's ruling family. The transfers came to a total of close to $75 million "whose origin could be illicit", according to the document. These funds were transferred to accounts held by several people, including Bouya and Catherine Ignanga.

In 2008 and 2009, Bouya bought two buildings in Québec for a total of close to $1.3 million without a mortgage. He did not return our calls for comment.

Tite Kaba is a Congolese civil servant. He was in charge of land titles until 2016 when he was accused of producing a false deed for the benefit of an individual close to the Nguesso family.

Kaba and his wife, Rachida Kaba, have invested over $4.2 million in Quebec's real estate since 2008 (in several cases, with a mortgage). They refused to reply to our questions regarding the origin of the funds.

Chad

Ibrahim Hissein Bourma is married to the sister of Hinda Déby. Hinda is the wife of Idriss Déby, Chad's president since 1990. The main client of Bourma's profitable import-export company, Oum-Alkheri General Trading, is the Chadian government.

In 2013, Bourma was stopped in Egypt with over $200,000 hidden in a secret compartment of his suitcase. He was later acquitted on a technicality after an intervention from the Chadian embassy. His lawyer told us he was acquitted in 2015 and that the affair was an unfortunate "imbroglio".

In Canada, Bourma bought properties worth over $4.9 million without a mortgage between 2012 and 2016 through his company Investissement Siham Canada Inc. He told us: "I come from a family of businessmen, so I can only succeed." On why he likes to invest in Québec, he said: "In Dubai, you can buy flats and the price drops very fast. In Montreal, it has been stable for years... If you see the number of apartments that I bought, it's clearly for investment."

Bourma's brother, Mahamat Zene Isseine Bourma, is married to President Déby's daughter. He bought a flat in Montreal for about $490,000 in 2013 without a mortgage. The previous year, he was appointed Chad's paymaster general by Déby and tasked with overseeing all government spending. At this time, his company won large public contracts such as supplying ambulances to the Ministry of Health. In 2016, he was fired from the job after accusations of embezzlement. He told us these allegations were without basis. "The story was proven wrong... they've invented quite a few things," he said.

The sister of the two Bourmas, Amina Hissein Bourma and her husband, Mahamat Kasser Younous, bought a flat worth $340,000 in Québec in 2012. The following year, they purchased a villa worth $840,000, both without a mortgage. At the time of the purchases, Younous was director of Chad's national oil company. They did not return our calls.

Cameroon

Jacques Ndjamba Mbeleck is a consultant who founded the Cameroonian accounting company, CAC, which is very active in Chad's oil sector. He also told us he is good friends with Mahamat Bourma.

In 2011, Mbeleck's firm was advising Chad's government. In this time, it received a $7.4 million bonus payment directly from the oil company Griffiths Energy International. An independent auditor looking into Chad's extractive revenues described this transaction as "against best practice". Griffiths had just won oil rights in Chad. A couple of years later, this deal raised controversy as Griffiths admitted to bribing Chad's ambassador to Canada and his deputy to obtain the permits. No accusations of corruption have been levied against CAC. Ndjamba Mbeleck told us that the $7.4 million payment was above board.

In 2012, Mbeleck bought a flat in Montreal worth around $420,000, with a mortgage. He bought another property worth $580,000 the following year, without a mortgage.

Gabon

Zéphyrin Rayita is a senator who has held high-ranking positions in Gabon's telecommunications sector. Lin Mombo is a civil servant who has worked in the same industry. Mombo is also the partner of Marie-Madeleine Mborantsuo (aka "3M"), the powerful president of Gabon's constitutional court, which ruled in favour of President Ali Bongo after the controversial elections last year. In March, RFI and the Canard Enchainé revealed that Mborantsuo is under an investigation by French authorities for allegedly embezzling public funds and money laundering.

In 2003, Rayita and Mombo bought a two-story building in Montreal for $2.2 million with a mortgage covering half the amount. They sold it four years later. Reached over the phone, Mborantsuo said "you think that's how you'll be able to ask me questions? Do you think it's really normal that you call to tell me you'll ask me questions?" She then hung up and didn't reply to our subsequent messages.

We did not manage to reach Rayita. Mombo told us that state officials in Gabon are well paid and that he decided to invest his salary in real estate.

Joël Bernard Ogouma is the Inspector General of Taxation in Gabon, a country whose ruling family is targeted by the ill-gotten gains case in France. Ogouma himself has not been accused of corruption as far as we know. In Québec, Ogouma bought a flat for over $510,000 in 2014, without a mortgage. He did not respond to our calls for comment.

Senegal

Mamadou Pouye is a close associate of Karim Wade. Karim is the son of Abdoulaye Wade, Senegal's president from 2000 to 2012. Under his father's government, Karim held a number of high-level positions and gained the nickname "Mr 15%" in reference to the personal cut he allegedly took from public tenders. During that period, Pouye set up companies abroad, including in Panama, as was revealed in the Panama Papers leak.

After his father lost power, Karim Wade was arrested together with Pouye. Karim was sentenced to six years in jail for embezzlement, but released by a presidential pardon in 2016 after serving just three.

In the case, the prosecution alleged that Pouye had "helped or assisted" Karim "in the preparation, facilitation or undertaking of illicit enrichment". Pouye was convicted in 2015 and released on bail the following year. France and the United Nations criticised the trial's fairness. Pouye's lawyer claimed to us that his client is innocent.

In Montreal, Pouye bought a flat in 2012 for over $460,000 via a company registered in Canada named 9259-7087 QUÉBEC INC.

Madiké Niang was Karim Wade's lawyer during his trial. Previously, he occupied key ministerial positions in Adboulaye Wade's government. He was also reportedly targeted in the investigation into Wade and Pouye but was never formally accused.

In 2006, Niang bought a flat in Montréal for about $225,000 and another one in 2008 for about $270,000 with a mortgage. He did not return our calls.

Algeria

Réda Bedjaoui is the brother of Farid Bedjaoui. Farid has been accused of channelling millions of dollars in bribes for an Algerian oil deal and is on Interpol's wanted list. Over the years, Farid has given Réda at least several hundreds of thousands of dollars. Réda is not under investigation as far as we know.

Réda Bedjaoui has bought two properties worth a total of $4.7 million in Montreal and several others with his ex-wife. He did not respond to our requests for comment.

A third brother, Ryad Bedjaoui, has bought land worth $3.6 million in Montréal with a company whose majority shareholder was Farid Bedjaoui. He sold the land four years later. His lawyer told us that Ryad has "no financial relation with his brothers".

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