WASHINGTON, DC, April 10, 2019 – Claudia Sassou-Nguesso, the daughter of Republic of Congo’s President, paid for a luxury apartment at the Trump International Hotel & Tower (Trump International) in New York City with funds that appear to have been stolen from the Congolese treasury, Global Witness reveals today in a new investigation. Her front man was José Veiga, a controversial businessperson who is the target of a Portuguese probe into corruption and money laundering in Congo.
Claudia Sassou-Nguesso and Veiga together set up a murky scheme to purchase the apartment in Trump’s flagship hotel and tower in New York using offshore accounts, secrecy jurisdictions, anonymous companies and enabling lawyers. Since 2010, French prosecutors have pursued the Sassou-Nguesso family’s assets on the basis that they had been acquired through misappropriation of public funds and money laundering.
Three Trump Organization companies, belonging to President Trump, played key roles in the apartment deal: as the owner of the Trump International at 1 Central Park West, as the broker in the sale, and as one of the companies mandated to carry out background checks on the purchaser of the apartment. Two other Trump-led companies received maintenance fee payments from the apartment for years, though Trump resigned his positions in these companies the day before his inauguration as U.S. President. Further disclosures are required to fully clarify whether or not Trump has profited from the condo since he became U.S. President.
“Our latest investigation provides further evidence that some of the world’s most notorious politicians and businesspeople choose to stash their cash in Trump property”, said Mariana Abreu, Campaigner at Global Witness. “The Trump Organization must face serious questions as to the quality of its procedures for background checks on the purchaser of this apartment. It should explain why it proceeded with this transaction despite the apparent risks of money laundering and corruption associated with it.”
Documents reviewed by Global Witness trace over half a billion dollars leaving Congo’s treasury and multi-million dollar sums subsequently passing via companies in Delaware, the British Virgin Islands and Cyprus before being used to purchase the apartment in Trump International. An apparently sham public works contract involving Veiga is used as a pretext for siphoning off almost $20 million. One of the world’s leading law firms, K&L Gates, set up a New York shell company to make the final purchase, which was financed by a Cypriot front company linked to Veiga but ultimately owned by Claudia Sassou-Nguesso.
“Claudia Sassou-Nguesso and José Veiga used many of the tools of the global financial system to enable them to siphon, hide and potentially launder millions of dollars of apparently public funds through a luxury Trump property. Such money should be spent in the best interests of Congolese citizens,” said Abreu. “This highlights the urgent need to address the ways in which opaque companies can move funds around the world at ease, facing no tough questions on provenance or legitimacy despite multiple corruption warning signs.”
The consequences of transactions like these can be devastating, often for people battling poverty and corrupt governments in places like Congo, where leaders give public contracts to the least scrupulous investors and the most opportunistic criminals.
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Global Witness does not allege that either K&L Gates or the Trump Organization broke any laws in their roles in the acquisition of apartment 32G. There are no legal requirements in the U.S. for law firms or real estate actors to do due diligence on their clients, so the firm and Trump Organization may argue they were entitled to take on this business. This is part of a broader systemic problem that allows transactions such as these to take place with minimal scrutiny.
The U.S. and Europe have an obligation to address their own systems’ loopholes that enable corruption and money laundering, allowing notorious political elites like the Sassou-Nguessos to enjoy the luxurious spoils of apparently ill-gotten gains abroad.
Global Witness is calling upon relevant U.S. authorities, including congressional committees, to investigate these allegations and, if appropriate, hold the Trump Organization and Donald Trump accountable for their actions. Law enforcement in the U.S., France and Portugal should investigate the signs of money laundering in the purchase of the apartment and the seeming embezzlement of public funds by the Congolese Presidential family, enabled by Veiga. If it turns out that no laws were broken, then the law should be tightened up to make it more difficult for this sort of red-flag transaction to take place.
Global Witness wrote to Trump Organization, Claudia Sassou-Nguesso, José Veiga’s lawyer, K&L Gates, and the Congolese government spokesperson asking for comment on the details and allegations laid out in this article. No substantive responses were received by any of these parties, but the Trump Organization has consistently refuted allegations of wrongdoing around property ventures and deals. For further details of parties contacted and responses received, see the full report here.
Global Witness campaigns to end environmental and human rights abuses driven by the exploitation of natural resources and corruption in the global political and economic system. www.globalwitness.org