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    Angola:The Angolan Sovereign Fund and the Arch-Fraudster


    analysis

    When historians come to write the unexpurgated story of corruption in Angola, the chapter on how dual Swiss-Angolan national Jean-Claude Bastos de Morais enriched himself from the Angolan Sovereign Fund is sure to be a page-turner.

    Bastos de Morais is the silent partner of the former Sovereign Fund's chairman, José Filomeno dos Santos (Zenú), the hitherto-untouchable son of former President José Eduardo dos Santos who turned Angola into a kleptocracy during 38 years in power.

    The US $5 billion Sovereign Fund was created to stimulate economic diversity - a hedge against the future when Angola's rich oil reserves run out. Zenú and his buddy Jean-Claude are alleged to have treated the Sovereign Fund as their personal piggy bank and both face charges of fraud and money-laundering.

    Zenú's father used also set up the Angolan Venture Capital Fund (in Portuguese: Fundo Activo de Capital de Risco Angolano, FACRA) in 2012. Under Presidential Decree 108/12 FACRA received US $250 million to kickstart funding for small and medium-sized enterprises.

    FACRA was overseen by a three-man supervisory body chaired by Jean-Claude Bastos de Morais, with a fellow Swiss banker, Marcel Kruse, in charge of the Investment Committee. Since its inception FACRA has never published its accounts as required by law, yet Bastos de Morais and Kruse continued to pocket US $3 million a year for their so-called 'management' fees.

    Records show that they transferred FACRA's capital to a private management company named Kwanza Gestão de Participações Empresariais S.A. (KGPE), which is itself 99.99% owned by Banco Kwanza Invest (BKI).

    The fact that FACRA, KGPE and BKI all shared the same office address (Avenida Comandante Jika No. 150) should have raised a red flag. Even a cursory examination would have revealed a blatant conflict of interest given that the FACRA Supervisory Board chair, Jean-Claude Bastos de Morais, was also the majority shareholder of BKI (with an 85% stake). Records show that KGPE went on to funnel funds into companies set up by Bastos de Morais and his associates.

    Bastos de Morais is a colourful character, simultaneously under investigation for alleged fraud in Switzerland, Mauritius and the United Kingdom as well as Angola.

    Along with José Filomeno dos Santos, he is accused of widespread misappropriation of public funds, using BKI to launder and divert millions of dollars into the multiple shell companies they set up. Yet in spite of his recent indictment in Angola he remains at the helm of FACRA.

    How did he operate? One example: FACRA pays one monthly fee for unspecified services to Afrique Imo Corporation S.A., a company 90% owned by Jean-Claude Bastos de Morais. It pays a second lot of fees for 'staff recruitment' to Uniqua, a company owned by Jean-Claude's mistress Manuela Ganga. And it pays a third amount for 'IT services' to Swiss-registered Stampa Equus S.A. (General Manager, Jean-Claude Bastos de Morais).

    Another example: in 2014 FACRA made a US $6 million loan to a company named B'weza S.A. based in the Angolan capital, Luanda - a start-up which describes itself as engaged in the 'social banking business'. Four years on the B'weza website remains "under construction", empty except for a single banner promising: "We'll be with you shortly".

    B'weza's commercial manager, a Portuguese citizen named Rui Teixeira, says the company is owned by Quantum Global. Quantum Global is owned by Jean-Claude Bastos de Morais. B'weza S.A. is a subsidiary of B'weza International AG, founded in Switzerland in 2012 and managed by Jean-Claude Bastos de Morais.

    Also in 2014, FACRA invested in a company named Touch & Talk, set up by KGPE to promote and develop mobile banking. This was another shell company set up by Bastos de Morais and Kruse as a vehicle for diverting FACRA funds into their own accounts. The lawyer representing FACRA in the transaction was Bastos de Morais' own personal lawyer, Joana Filipe Lima da Silva Simplício de Oliveira - a further conflict of interest.

    Having amassed a fortune from his Angolan dealings, Bastos de Morais hired top-ranking legal and PR firms - Schillings - to polish his international image and create a veneer of respectability, passing himself off - even to the venerable Financial Times - as a masterful international investor and trusted advisor to the Dos Santos administration. He wrote:

    "Angola's government has been working hard to incentivise small businesses by offering attractive tax regimes to foreign investors (particularly outside of Luanda). Venture capital firms are also playing an increasingly important role in helping to facilitate growth with SME's. One such is the Angola-based Fundo Activo de Capital de Risco Angolano (FACRA), of whose supervisory committee I am a member.

    It is a public venture capital fund that specifically supports Angolan SME's in building, innovating and expanding their businesses."

    What Jean-Claude Bastos de Morais failed to mention was that, in practice, FACRA's money was mainly being siphoned into a bank and companies owned by himself and his associates.

    The fact that the Angolan Attorney General's Office has brought charges against Bastos de Morais, and his once 'untouchable' Angolan partner Zenú appears to be a small step towards justice. But unlike smaller fry accused of fraud and corruption in Angola, these three are not in custody awaiting trial. Astonishingly, Bastos de Morais remains at the helm of FACRA and he and Kruse continue to collect their US $3 million a year salaries.

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