Angola.The Next VP and the Legalization of Corruption

Manuel Vicente’s nomination as president José Eduardo dos Santos’ running mate in the upcoming August 31 election comes as no surprise.

By Rafael Marques de Morais

http://makaangola.org

The former Sonangol Chairman had long been expected to take the number two spot on the candidates’ list of the incumbent Popular Movement for the Liberation of Angola (MPLA) and thus walk into the job of Vice President when, as it is almost certain, the party wins the ballot.

What is baffling though about Mr. Vicente – who in January was plucked from Sonangol and appointed Minister of State for Economic Co-ordination – is the way in which he appears to be interpreting the laws of the country, most especially those regarding corruption.

On August 8, 2010, this author published a report titled “Presidency: The Epicentre of Corruption in Angola” in which it claimed Mr. Vicente and two other senior officials at the presidency were allegedly involved with illegal private business deals worth over US$1 billion across various sectors including oil, banking, telecoms, biofuels, and media.

The report highlighted how Mr. Vicente, then head of Sonangol, was also co-owner of Nazaki Oil and Gas, a company that set up a consortium with the U.S. oil company Cobalt. In 2010, Sonangol awarded two pre-salt oil blocs, 9 and 21, to the consortium (Cobalt 40 percent, Nazaki 30 percent, Alper Oil 10 percent and Sonangol Pesquisa & Produção, the remaining 20 percent) without public tender as required by law.

Furthermore, as head of Sonangol, Manuel Vicente selected the local equity partners, Nazaki and Alper, in clear violation of the Angolan anti-corruption laws. He selected his own company to be the main local partner of Cobalt, with which it still shares the same business address in Luanda.

Following the publication of this report and its dissemination in local media, MPLA spokesman, Rui Falcão Pinto de Andrade, publicly called on the “relevant authorities” to issue a public statement and for the judiciary to “act accordingly.”

The report led the U.S. Securities Exchange Commission (SEC) and the U.S. Justice Department to launch, last November, a formal investigation into Cobalt, on the suspicion of a violation of the Foreign Corruption Practices Act (FCPA).

Angola’s Law on Public Probity, which is the country’s main legal framework against corruption, allows ordinary citizens who have claim to have evidence of corrupt practices by public officials to personally lodge criminal complaints against the suspects. Thus, on January 06, 2012, this author filed a criminal complaint against the partners of Nazaki Oil and Gas S.A, namely Manuel Vicente, at that time Chairman of Sonangol, General Hélder Manuel Vieira Dias Júnior “Kopelipa”, Minister of State and Head of the Military Bureau of the President of the Republic; and General Leopoldino Fragoso do Nascimento, top military advisor to General Kopelipa in the presidency.

At that time the three each held equal shares (33.3 percent) of the joint stock of a company called Grupo Aquattro Internacional S.A., which in turn, held 99.96 percent of the shares of Nazaki Oil & Gas.

The criminal complaint alleged that the three men used and abused their positions of power and their ability to influence President Dos Santos, who promulgates the deals, in order “to gain illegal control over state assets in the privatisation of public companies” and for the “creation of consortiums with public and international companies.” In 2009, Dos Santos signed off the privatization of the then state-owned mobile operator, Movicel, to a consortium of local companies led by Portmill Investmentos e Comunicações. This phony company, which benefitted from 40 percent of the shares, had been set up as a subsidiary of Grupo Aquattro. Just a month before the final act of privatization, the trio had formally transferred their shares to a group of senior officers of the president’s detail.

To date, the response of the Attorney-General’s office to this criminal complaint has been one of eerie silence, even though a separate complaint lodged by the author, also making allegations against senior military and government figures has elicited a response.

This second complaint , dated November 14, 2011, alleges that nine military Generals – among them Minister of State General Hélder Manuel Vieira Dias Júnior “Kopelipa” were involved in gross human rights abuses and corruption in the diamond areas of the Lundas’ region.

On receiving this complaint, the Attorney General’s office promptly summoned the author to provide additional testimony, along with several witnesses. An impact has already been felt, the private security company Teleservice, which belongs to the Generals and is at the centre of the allegations, having withdrawn its operations from the diamond areas.

Many wonder why so little has happened regarding Mr Vicente’s case. Perhaps the answer lies in an old law dating back to Angola’s Marxist-Leninist period (and which is at odds with the 2010 constitution),that says the Attorney General, “receives direct instructions” from the president of the Republic. The law also establishes that the president’s instructions to the Attorney General are for “compulsory compliance.”

If it is the president of Angola who ultimately decides who to prosecute and who should be shielded from the law, then it appears President Dos Santos has decided that the man he has appointed as his putative successor will stand above the law.

Nevertheless, while he has been careful when making personally statements that might be interpreted as dismissing the rule of the law, his inner circle has a different approach.

In April this year, Manuel Vicente and General Kopelipa openly admitted, to the Financial Times, that they were shareholders of Grupo Aquattro and, thus, owners of Nazaki.

This acknowledgement follows an October 10 2010 rebuttal to the report published on Maka Angola, where Nazaki’s frontman formally denied any links to Mr Vicente and Generals Kopelipa and Nascimento. Zandre Eudénio de Campos Finda stated that none of the persons mentioned “have any connection with the company, are not shareholders (…)”

In a written statement to Cobalt, for legal purposes, Mr. Finda claimed that the “self-appointed ‘Angolan journalist and human rights activist´” Rafael Marques de Morais made allegations that were “abusive of the right to freedom of expression, crudely disrespecting the most elemental ethical and moral principles that govern journalistic activities, to which he allows himself to add sensationalist affirmations and misleading arguments.”

In their written statement to the Financial Times, Mr Vicente and General Kopelipa claimed to have dissolved Grupo Aquattro. This act merely involves the publication in the state daily gazette of the dissolution act, and it does not preclude acts of corruption they engaged in with previously with the company.

Mr Vicente and General Kopelipa’s reasoning for publicly acknowledging their shareholdings to the Financial Times is being widely interpreted as little more than a public relations exercise for international audiences. Internally, Mr Vicente knows he can enjoy the impunity afforded to him by President Dos Santos thanks to his absolute control of Attorney General’s office. President Dos Santos shields his running mate from prosecution, and allows him to proceed with his corrupt deeds and, by extension, those of the president as well.

The Financial Times failed to acknowledge that it had sourced its original information from Maka Angola, nor did it make any efforts it appears to question the ownership structure of Alper Oil, the other Angolan company with an equity share in Blocks 9 and 21.

Hopefully Mr. Vicente will grant a second “rare interview” with an international media outlet in order to be able to make this final disclosure.

The now infamous misplacement of US$32 billion of state funds that took place, between 2007 and 2010 happened on Mr. Vicente’s watch. According to the International Monetary Fund (IMF) most of the money went to “quasi-fiscal operations being conducted by Sonangol, on behalf of the government that was not being recorded as budgetary spending.” But while the Fund was keen to point out most of the money had been “accounted for,” no evidence was provided to the Angolan public to show how. That in of itself could be argued as a cause for legal action against the president and Manuel Vicente. Furthermore, there is no law in the country that enables Sonangol to engage in quasi-fiscal operations. Even to adjust fuel prices, each time, Sonangol must seek permission from the executive, which grants it in the form of a decree published in the National Daily Gazette. Furthermore, the 2002 Law on State-Owned Companies (Empresas Públicas) clearly establishes that all cash flows between such companies and the state shall be recorded in the state budget. Those who fail to comply are subject both to civil and criminal penalties. The IMF’s argument that the country has accounting capability issues wears a little thin. If anything, Sonangol has proven just how good Angolans can be at accounting and financial management.

Mr. Vicente appears to be oblivious to Angolan law to have been able to say so confidently to the Financial Times that there was no corruption in the Cobalt deals. He told the journalist: “It is important that the world understands. The idea is to empower the locals and we’ll keep doing that surely, within the [Angolan] law.”

To which laws could Mr. Vicente have been referring? Which Angolan laws allow a government official, while on duty, to engage in private business ventures with the state he serves? There are no such legal provisions. On the contrary, such acts constitute crime under the Angolan Law on Public Probity.

Thus the Financial Times in its publication of this story has ignored the country’s relevant legislation and taken Mr. Vicente’s remarks at face value, as do so many academics and the IMF who offer their expertise on such matters.

Under the Presidency of Dos Santos, it could be argued that corruption is the governing institution, but under Mr. Vicente this author believes it will become the law.

President Dos Santos has maintained a veneer of legality in his official discourses against corruption, in order to legitimize himself and his regime. But, his choice for vice-president appears to unabashedly champion corruption as a legal deed, and saddest of all, Mr. Vicente’s message finds no critical filters abroad.