5 February 2019

Angola: The Hunter, Hunted - An Angolan General's Hunting Lodge

analysis

Angolans call the remote southeastern province of Kuando Kubango "the end of the world" (in Portuguese: "o fim do mundo"). Bordering Zambia, Botswana and Namibia, it's more than a thousand kilometres inland from their country's capital and a byword for the poverty and destruction wrought by more than 30 years of civil war.

As its ruined roads, bridges and infrastructure remind us to this day, Kuando Kubango was a heavily-mined battleground; the heartland of the US-backed rebel UNITA movement, headquartered in Jamba.

With the end of the civil war in 2002, the national government did set aside funds for rebuilding. The so-called 'Peace Dividend' has allowed individuals to amass huge fortunes from Angola's reconstruction but all these years later Kuando Kubango remains largely unreconstructed, in part because of the diversion of public funds into the pockets of corrupt officials during the Administration of former President José Eduardo dos Santos.

Information supplied to Maka Angola has supplied a new lead for investigators looking into the affairs of yet another of the high-ranking officials associated with the Dos Santos years, General Higino Carneiro.

General Carneiro, was appointed Governor of Kuando Kubango in 2012. The state budget allocated the equivalent of some US $115 million from public funds specifically for the construction of clinics, schools and homes for public workers in the province. The money was spent, but there is not much to show for it. The specified clinics, schools and homes were not all built. However, during his four-year term as Governor, General Carneiro did construct a fancy private hunting lodge in the province that cost many millions of dollars to create.

From Socialist Freedom Fighter to the Rich List Top Ten

During decades of poorly-paid public service, somehow Francisco Higino Lopes Carneiro (to give him his full name) managed to build and take over hotels and business empire, becoming a multi-millionaire while still on active duty. Like so many of his peers his rise to riches began when he joined the MPLA's fight for independence, rising through the ranks of its military wing, the FAPLA, and proving his loyalty to President dos Santos.

Angolan army commanders have always combined both military and political roles, since the days when the ruling party was a Soviet-backed liberation movement whose military wing required political commissars. They remained on active service even when assigned to openly political jobs or to civilian government positions until their formal retirement from the military is gazetted.

This was the case with General Carneiro. Dos Santos rewarded his loyalty by placing him in positions from which he could reap handsome profits. First as Governor of the province of Kwanza Sul (1999-2002), then as Minister of Public Works (2002-10) and latterly as Governor of Kuando Kubango (2012-2016) and Governor of the Province of Luanda (2016-2017). In between, he was appointed to both the central committee and politburo of the ruling MPLA and elected to Angola's parliament, the National Assembly.

There is no doubt that Angolan Generals were encouraged by their larcenous commander-in-chief to defy conflict of interest laws on public probity and pursue private commercial activities, only made possible by the positions to which he appointed them.

This was the reward system employed by President José Eduardo dos Santos both to guarantee the ongoing loyalty of the politico-military hierarchy and also to make his comrades and associates complicit in the state-sponsored theft of the country's oil wealth for their own benefit.

Only a few years ago, Higino Carneiro's personal fortune was estimated as the fourth largest in Angola (the President and his daughter held the first two positions). In achieving this Carneiro acted no differently from his peers in the Dos Santos Administration. After decades of self-sacrifice on the front line they saw no moral quandary in accepting the opportunity to be handsomely rewarded, all with their President's connivance and blessing.

But the winds of fortune changed when Dos Santos was replaced in September 2017 by João Lourenço as President. Lourenço vowed to tackle the endemic corruption that had given his country an infamous global reputation as a kleptocracy. Initially, only small fry were swept up and prosecuted. But when one of Dos Santos's sons was arrested on charges of embezzlement, fraud and money-laundering, it became clear the game was up.

Allegations of maladministration of hundreds of millions of US dollars in funds during his term as Public Works Minister saw General Carneiro sacked as Governor of Luanda and suffering the indignity of a formal investigation. So far, he has not been charged - but new evidence of the diversion of funds during his time as Governor of Kuando Kubango may change that.

The Kuando Kubango Scam

The directors of a Namibian construction company say they were duped by General Carneiro into building his private hunting lodge for which they can show evidence that he used state funds earmarked for public works.

Carneiro's private lodge

They say the General obscured his own part in the scam by using intermediaries. This was standard operating procedure by officials in the Dos Santos years, to circumvent the Law on Public Probity which expressly prohibited public servants from such conflicts of interest. "Mr Big", the politically-exposed person, remains in the shadows so that only the straw men and patsies get swept up by police if things go wrong.

Beacon Global Namibia (BGN) say that General Carneiro used deputy governor Joaquim Duma Malichi to issue a tender for 11 proposed public works in Kuando Kubango to a company named Beacon Global Angola (BGA) in February 2013.

This was strange as BGA did not yet exist. It was only set up up two months later. Even its parent company BGN didn't yet exist. It was formally registered three days after the date on which Malichi officially issued the tender.

According to Angola's official gazette, the Diário da República, the founders of Beacon Global Angola were Alicerces José Cachala and Rosário Fernando Neves Tunda. Both were low-level provincial functionaries with no business experience.

Cachala was the official driver for the lowly-paid municipal administrator of Rivungo, Júlio Vidigal. Neves Tunda was also a provincial employee. Neither would have any role in BGA other than to lend their names to cover the identity of the real owner. Even though Vidigal used their names as the ostensible partners on the Angolan side, it was his signature on the contract with the Namibian parent company BGN and his signature on the BGA bank account into which provincial government's funds were deposited and unaccountably withdrawn.

Duped and Unpaid

In extensive face-to-face interviews in the Namibian capital, Windhoek, BGN's partners and directors laid out the evidence to Maka Angola. BGN director Estêvão Feliciano da Cruz told Maka Angola they discovered the BGA partners were 'straw men'. "Both these individuals were trusted employees who worked for Administrator Vidigal in Rivungo (... ) He [Vidigal] was the person who really set up the company (on behalf of General Carneiro) and they [Cachala and Neves Tunda] were the straw men.

There was no attempt at opening the tender to public competition. General Carneiro, in his capacity as Kuando Kubango Governor, made the decision unilaterally and apparently jumped the gun when he got his deputy governor to offer contracts worth the equivalent of US $21 million to BGA two months before its corporate existence. The only explanation is that he knew plans were afoot to create this company as a vehicle to divert public works monies.

The public works were to include a 70-bed clinic, costing seven million US dollars, in Jamba, once the legendary general headquarters of UNITA but nowadays the county seat of the Comuna (district) of Luiana.

Documentary evidence shows this was one of the works awarded to BGA and that the provincial government paid nearly 700 million Kwanzas (US $7 million) to BGA "for the purchase of equipment and start of works".

BGN's Estêvão da Cruz says: "at the Governor's request, 145 million Kwanzas [of that 700 million Kwanza down-payment] was diverted towards the construction of a 30-bedroom hunting lodge in an area named Bico de Angola".

Another of the BGN partners, Ramos Talaya, told Maka Angola: "General Higino Carneiro personally asked Walter Pinto [a BGN partner appointed as Director-General of BGA) to use the public money to prioritize work on the lodge and that he [the General] would personally reimburse the government project afterwards." Why did BGA comply? "You couldn't say no to the Governor unless you wanted to lose the other contracts and create problems with the Angolan authorities".

Curiously, the original signed contracts for the 11 projects went missing at the Governor's office. According to Estêvão da Cruz, "The Governor's office asked us to hand over the original contracts to Dr. Lena as part of the Planning Department's approval process (homologation). They failed to return the original papers to us."

General Carneiro brought a delegation, including family members, to inspect progress on the lodge in 2014. During that visit, "We pressed him both for overdue payments and for the reimbursement of the public works monies. He told us that we should first finish the work, and only then would we get the money."

The final cost for the works by BGA to complete the lodge was $2.2 million USD and BGN says the governor reneged on the payment.

BGN says the paper trail suggests General Carneiro contributed only one payment, a mere US $160,000, from his own account to the US $2.2 million total construction cost of the lodge.

BGN is still waiting for the remaining balance of payment for the work done.

Another of the partners, David Daniel, told us that when the lodge was completed and with only minor finishing remaining, "General Carneiro threw us (BGA) off the project, failing to pay us or reimburse the state for the public monies."

Not far from the lodge in Bico de Angola is a half-built eight-room school and the footings for what should have been six homes for the police. Work on these stopped when the money dried up.

BGA was also given a US $4.5 million USD contract to build 100 homes in the nearby municipality of Calai. "We had four homes built and roofed, and the foundations dug for another 15. The provincial government failed to make the first payment so work had to be abandoned," says Ramos Talaya.

David Daniel admits BGN was suspicious when their Angolan subsidiary was the only company offered the contract, without public tender, and that their concerns mounted when they saw Júlio Vidigal's signature on BGA's bank account with power of attorney to withdraw funds at will.

"We were told that no-one gets a contract to do work in Angola without it being part of some 'scheme'. I found the whole thing very suspect. We tried to persuade the Governor and his deputy to take Júlio Vidigal out of the picture, but they only removed him when BGA went under."

What Did BGA Deliver?

Officially, BGA completed only two of the contracts awarded by General Carneiro: the clearing of a 50-kilometer stretch of terrain for a road between the town of Jamba and the frontier post of Buabuata; and the outfitting of the Buabuata border police post. These two projects were worth 382.7 million Kwanzas (US $795,000).

Back in Namibia, the BGN directors and partners say they also delivered 22 T3 classification dwellings, completed save for installing the solar panels designed to provide electricity for them. The initial contract was for 55 of these homes but the provincial government reduced the number to 25, claiming a budget shortfall.

BGN says they were 90% of the way to completing one eight-room school and 60% done on a second 12-room school in Jamba. All that was left to do on the first project was install the solar electrification panel and assemble the water main pipe into the trench that had already been dug.

As David Daniel points out, "the public monies wasted on the lodge could have built another two or three schools". Seventeen years after the 'peace dividend' an estimated two million children in Angola are still denied an education due to the lack of schools.

The unfinished school in Jamba

Maka Angola contacted the current provincial government of Kuando Kubango for their response to these allegations but they declined to comment, on the grounds that this is an active case. According to Planning Department official Manuel Filipe, "We cannot say anything as the case is under judicial secrecy; we are limited from giving out any more information. We have to wait for the judicial outcome and then we hope to have more information."

Arrest Warrants for BGN Partners

BGN say General Carneiro was the mastermind of the scam. They accuse him of using Vidigal to conceal his ownership and of illegally and unprofessionally awarding misleading contracts for his own benefit. They say the unexplained BGA account withdrawals and unaccounted payments were fraudulent diversions of public monies to pay off the intermediaries and finance his private hunting lodge while creating convenient scapegoats.

But the investigation so far has focused on those scapegoats. The BGA Director-General, Walter Pinto, has been made the fall-guy, arrested and remanded in custody since September 2018. Twice he has been named in the Angolan state media as the ringleader in the diversion of the Kuando Kubango public funds and the failure to complete the works. He faces charges of abuse of trust and fraud over the failure by BGA to complete the public work contracts.

As soon as Pinto was arrested, a spokesman for the Criminal Investigation Service, Paulo Dias de Novais, told the state daily newspaper Jornal de Angola "that the 'Beacon' proprietor was unable to offer any information regarding the whereabouts of the money received from the Angolan State via the provincial government of Kuando Kubango."

Two months later, on November 22, the Angolan authorities officially requested Namibia's Ministry of Safety and Security issue an arrest warrant for David Daniel and Ramos Talaya and their fellow partners in BGN: Araújo Muachinoque, Estêvão Muachinoque, Paulus Hango, and Thulungeni Pohamba (son of Namibia's former President).

Araújo Muachinoque says the Angolan request was the result of false, bad-faith information from the provincial government. "The work we undertook far exceeded the value of what was paid."

The Namibian partners say they are drowning in debt owed to workers and suppliers because the Kuando Kubango provincial government failed to pay what was owed. They blame the Angolans for deliberately creating confusion to muddy the money trail: "Walter Pinto had to give Vidigal power of attorney as a signatory on the BGA account and Vidigal repeatedly made unauthorized withdrawals."

Maka Angola was able to inspect bank statements that support this: we saw eight successive transfers of 16.8 million Kwanzas made by Administrator Vidigal to two other 'ghost companies': Bervim Lda. e Ezimoy Lda.

Araújo Muachinoque was in charge of overseeing the BGA projects in Angola for BGN. He says that the 'evidence' for the arrest warrants referred to works that had nothing to do with BGA: "The provincial government cited a contract for the equivalent of a million US dollars to supply electricity to the village of Tukuve in Menongue district, on the pretext that this was one of the works specified in the contract with BGA. But we had never received a contract for that project and knew absolutely nothing about it."

The Namibians are staggered that the Angolan investigating authorities have so far failed to look into who really owned BGA and the destination of the unauthorized withdrawals from BGA's bank accounts. They say it's inconceivable that the investigators would not be able to make the connection between the monies destined for public works and the construction of General Carneiro's lodge.

Maka Angola's legal specialist, Rui Verde, says the evidence supplied by BGN points to both Higino Carneiro and Júlio Vidigal having repeatedly broken the anti-corruption laws and the issuing of contracts for public works. He says: "Peculation and misappropriation of public funds are both administrative and public finance felonies, not to mention an abuse of power."

General Carneiro thought he could get away scot free. Even amid the mounting evidence against him, he believed he was well shielded by parliamentary immunity, the protection of his erstwhile benefactor and the threat that if he were arrested, he would bring down those above him.

The hunting lodge may prove his downfall.

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