Panama Papers: Documents related to Haiti show close people to Michel Martelly, Laurent Lamothe; and other high ranking officials

Posted by Miami Herald on Thursday, April 28, 2016 Under: Corruptions

Of all the tales coming out of the Panama Papers scandal, few involve such an intriguing mix of characters as the Haiti petroleum deal.

The cast includes an ex-bank executive, the former head of Haiti’s investment promotion agency, and a close friend of then-Haitian President Michel Martelly. Also in the mix: a Trinidadian businessman who once received a mysterious $1 million payment from a firm linked to Brazil’s ongoing bribery scandal. He is also a close associate of a disgraced former vice president of the organization that runs the World Cup.

Since they first came out this month, the Panama Papers — 11.5 million secret documents leaked from Mossack Fonseca, the Panama law firm specializing in the creation of offshore corporations — have pulled back the veil of secrecy on how the wealthy and powerful sometimes hide their assets.
The Haiti-related documents offer up a slightly different wrinkle. They are a window into how the politically connected use their proximity to power to negotiate questionable side deals on behalf of private interests.

It is, longtime observers of Haiti say, an old story, ingrained in the political culture. As with many Mossack Fonseca offshore transactions, it involves a complex labyrinth of cross-border connections.

The Haiti petroleum arrangement was born in 2014. Haiti was looking for ways to cover a 120,000-barrel-a-month Venezuelan oil shortfall and cut its fuel costs. The country turned to oil-rich Trinidad and Tobago.

While that was playing out publicly, in the shadows, a politically connected clique was maneuvering to get a piece of the action, the leaked records from Mossack Fonseca show.

A central figure in both endeavors: Georges Andy René.

From August 2012 to February 2014, René was head of the Centre de Facilitation des Investissements, or CFI. It is the arm of Haiti’s government that promotes investment.

In his role as head of the CFI, René pushed the proposal to forge a petroleum deal with Trinidad, Haiti’s commerce minister at the time says.

But René was also working with Mossack Fonseca to set up offshores that could cash in on the petroleum deal, according to a Jan. 27, 2014, email in the MF files. That effort, described in a later email, involved securing the “exclusive right” to facilitate Trinidadian petroleum imports, the law firm’s documents show.

MF records show that five days before Haitian commerce and Trinidadian energy ministers inked the energy cooperation agreement at a Port-of-Spain hotel on July 28, 2014, René — by then working as special adviser to then-Prime Minister Laurent Lamothe — was frantically seeking to obtain a power of attorney from the Panama law firm in order to form a Haitian company “to capture this opportunity.”

One of the company’s major shareholders would be an established shell called Proteus Holding S.A. that René had purchased months earlier from MF.

He wanted the power of attorney, René wrote in the leaked files, so that Max Alfred Buteau, a business associate, would have “the authority to represent Proteus Holding to form a company called SNIPP S.A. and acquire at least 50%.” SNIPP would have the import rights to the oil from Trinidad and Tobago.

Buteau, a former bank vice-president described by René as “well-known by all local stakeholders and highly referred,” was sometimes well-known for the wrong reasons. In 1988, Buteau was arrested by British police and charged with trying to defraud a London-based bank of $25.5 million. He was later accused by a Haitian government commission investigating public corruption during President Jean-Bertrand Aristide’s 2000-2004 administration of misappropriating millions of dollars in public funds by serving as a front for a sham rice deal.

In August 2014, a Haitian judge issued a warrant for Buteau’s arrest in connection with the revived — and still unresolved —Aristide corruption allegations. Buteau did not respond to an email from the Herald.

Twenty days after René sent the Buteau power-of-attorney email, he fired off another message to MF: “It is urgent that we get this today.”

Contacted by the Herald, René would not go into detail about his role in the signed memorandum of understanding between the two countries.

As for his dealings with Mossack Fonseca, René said he had done nothing illegal and that he was simply “acting as an attorney.”

“I represented, through the years, hundreds of clients, from all over the world. I can confirm to you that I have had through my career, legal professional exchanges with the Mossack Fonseca law firm, as many other business lawyers did,” he said in an email. “Any communication between law firms is subject to strict privacy, and I cannot provide you details about my clients’ files.”

However, his role appears to go beyond that of attorney. He owned 25 percent of Proteus, as revealed in the MF documents.

Former Haitian Commerce Minister Wilson Laleau, technically René’s superior when the latter ran CFI, said the energy cooperation deal was brought to the government’s attention by the investment agency.

“Andy René’s was responsible for CFI, and CFI was the one working on this portfolio,” he said.

Laleau said he did not know René was also preparing to set up a commercial operation to benefit from it.

Lamothe, the former prime minister who hired René to advise him on investment matters, said he, too, was unaware of René’s dual roles, calling them “a big conflict of interest.”

According to the leaked files, René first contacted Mossack Fonseca in January 2014, while still with CFI. That same month a Haitian delegation visited National Petroleum Marketing, Trinidad’s state-owned petroleum company to discuss a possible deal for petroleum products, company spokeswoman Jessica James confirmed. The delegation included representatives of CFI and a company called Kimazou.

Kimazou has strong ties to Martelly. Its vice president, Ralph Pereira, is a close friend of the former president and had served as his informal adviser. Pereira did not respond to Herald questions.

Pereira was present at the ceremony marking the tentative petroleum deal between Haiti and Trinidad. His firm would partner with René’s shell company to form SNIPP — a French acronym for the National Society of Petroleum Products Imports S.A.

On Jan. 27, 2014, an MF executive assistant sent an email to the law firm’s compliance department asking to “please perform full searches of the following people” related to the sale of Proteus.

The two individuals were René, then still the head of CFI, and his chief of staff, Vladimir Laborde. Mossack Fonseca charged René an acquisition fee of $7,000 plus 7 percent tax and $2,715 annually to use Proteus’ corporate structure, which came with a preexisting board of directors — what are sometimes called “dummy directors.”

The inquiry about René and Laborde was a due-diligence check, a normal procedure with MF clients, especially those in positions of political influence. Part of this check involved asking René about his job as Lamothe’s special adviser and whether it posed a conflict.

“No way,” he answered.

René and another business associate, Gary Berridge, would be in frequent contact with MF over the next several months to finalize the Proteus purchase and power of attorney for the creation of SNIPP. Berridge described his role to the Herald “as an independent consultant” and “a process facilitator.” Like Pereira, he was photographed at the signing of the petroleum agreement.

In a Mossack email to Berridge, it was confirmed that the stock in Proteus would be allocated thusly: 25 percent for Laborde, 25 percent for René and the rest for Pendrey Associates, another Panamanian shell company.

Pendrey’s sole shareholder is Ken Emrith, a low-key Trinidadian businessman and close associate of Jack Warner, former vice president of FIFA, the World Cup organization.

Emrith once worked as Warner’s chief executive officer in charge of a $26 million soccer academy on the outskirts of Trinidad’s capital. Warner is currently fighting extradition to the United States, where he faces charges of racketeering, wire fraud and money laundering in the ongoing FIFA corruption probe.

Although the soccer academy he oversaw has generated controversy — because it was built on Warner-owned land with FIFA money — Emrith has not been charged with any FIFA-related corruption.

A year before Emrith emerged in MF’s Haiti documents, the Bank of Saint Lucia International Ltd. told him it was unable to accept a $1 million wire transfer into the account of his Pendrey Associates shell company. The transfer was from New Zealand-based Santa Tereza Services. Around the same time, on Aug. 6, 2013, the bank said it had decided to close Emrith’s account.

Emrith contacted Mossack Fonseca for help in clearing up the issue, which it did.

With Mossack’s assistance, Emrith provided a copy of an agreement with Santa Tereza Services Ltd. saying Pendrey was hired to provide technical services for a port expansion in Namibia.

The Brazilian press has reported that Santa Tereza was controlled by João Procópio Junqueira Almeida Prado, a top employee of accused Brazilian money launderer Alberto Youssef.

Youssef is at the center of Brazil’s ever-widening corruption investigation.

Dubbed Operation Lava Jato or Car Wash, it began with kickback allegations involving Brazil’s state-controlled oil company, Petrobras, and has now ensnared some of Brazil’s largest corporations and scores of politicians, some of whom have popped up in the Panama Papers.

Youssef is accused of using offshore accounts — including Santa Tereza — to move hundreds of millions of dollars as part of the Petrobas kickback scheme. Emrith has not been connected to any wrongdoing in the Brazil probe.

In the end, the oil deal between Trinidad and Haiti fizzled, dashing any dreams of cashing in.

Shruti Shah, vice president of the U.S. chapter of the global anti-corruption group Transparency, said the lack of competitive bidding and the political connections of all involved raise conflict-of-interest issues.

“When a government doesn’t do competitive bidding, that is a red flag of corruption itself,” she said.

“In Haiti’s case, you have somebody close to the president, to the prime minister,” she added. “There are conflict-of-interests issues.”

The Mossack Fonseca revelations come as the awarding of government contracts during the Martelly years has come under intense scrutiny. Opponents want an an audit of public spending. They have accused powerful Martelly supporters of thwarting efforts by the interim president to put a caretaker prime minister and cabinet in place.

The suspicion is that all this is intended to block any audit.

In : Corruptions