Swiss Banking Secrets Reveal Millions in Alleged Libyan Money Laundering

In the late 2000s, Libyan officials and businessmen siphoned off millions of dollars in state funds and transferred it abroad, according to an investigation by the Organized Crime and Corruption Reporting Project (OCCRP) and its partners.

Libyan Officials and Businessmen Siphoned off Millions

During this period, amongst the individuals involved were:

• One Libyan official
• Three businessmen

All of these individuals were clients of Swiss banking giant Credit Suisse and held tens of millions of dollars’ worth of deposits in their accounts. Before and after the 2011 uprising that toppled Muammar Gaddafi, these figures were implicated in corruption investigations.

The Role of Alubaf Bank

One of these businessmen was the Tunisian-Libyan Alubaf Bank, which played a significant role in Libya’s development sector by guaranteeing letters of credit for public contracts. Alubaf Bank held an account at Credit Suisse from 1995 until 2014 and collected millions of dollars during the period when Libya was under United Nations sanctions.

Corruption in Libya’s Development System

The individuals and the bank were part of a broader system of corruption used to divert Libya’s vast oil wealth during Gaddafi’s four decades in power. Transparency International reports suggest that his regime had likely stolen around US$61 billion.

Credit Suisse Statement

Credit Suisse, in a statement, claimed it had followed the laws of the time and had substantially increased its efforts to combat financial crime. However, the bank refused to comment on specific clients implicated in the investigation.

Corruption Allegations against ODAC

Libya’s uprising brought the country’s development system under renewed scrutiny. ODAC, the state-run company handling public infrastructure contracts, became the focus of numerous corruption allegations. After Gaddafi’s fall in 2011, investigators discovered that billions of dollars in ODAC contracts had gone missing. It seemed that much of the funds had been stolen by the former head of the organization, Ali Ibrahim Dabaiba, and his family.

Ali Ibrahim Dabaiba’s Accounts

Among the figures implicated was Ali Ibrahim Dabaiba,who held the following Credit Suisse accounts:

• An account opened in 1990 and remained active until 2012, with a maximum balance of around $176,000 in November 2009.
• A joint account with Costa Rican firm Cold Harbor Advisors S.A., opened in 2007, which had a maximum balance of nearly $16.8 million in the same year.

Ibrahim Ali Dabaiba’s Account

Ibrahim Ali Dabaiba, Dabaiba’s eldest son, held a joint account with Cold Harbor Advisors S.A., from 2007 until 2011 when it peaked at a balance of around $16.8 million. The account was closed before Libyan officials sought help tracing looted state funds in 2013.

Concerns around Current Interim Prime Minister

Libyan authorities have tried unsuccessfully to enforce sanctions on the alleged corrupt figures. With current interim prime minister Abdelhamid Dabaiba, who is Ali Ibrahim’s cousin, making budget demands to build new infrastructure projects, there are concerns that his government could become embroiled in similar corruption schemes.