President Dos Santos Illegally Inflates Daughter’s Fortune

Recently, Maka Angola published an article about Isabel dos Santos’ purchase of 65% of Portuguese power solutions company Efacec, for 200 million Euros. In reaction, the Portuguese weekly, Expresso, published a front-page article saying a large part of the money used by Winterfell to buy Efacec was financed by a Portuguese bank. This article was an attempt to dispel suspicions about the dubious source of the money.  The article raised more doubts as it became clear that the Angolan government financed the other part of takeover. The interested parties rushed the deal, and settled it on October 23.

The banks that financed this “large part” are Caixa Geral de Depositos, the BCP, BPI, Montepio and BIC, according to an official press release.

BCP, BPI, Montepio and BIC are dominated by Angolan capital; that is, Isabel dos Santos and Sonangol.  Therefore, this is a situation in which banks lend money to their own owners.

The regulatory authorities in Portugal cannot have been paying attention because their  procedures seem to have overlooked the conflict of interests between the owners and the loans.

Furthermore, there is a second question of much importance.  Isabel dos Santos is a PEP or “Politically Exposed Person.”  According to the FATF (Financial Action Taskforce) guidelines, her dealings in Portugal need to be scrutinized closely to make clear the origin of her fortune. Therefore, it can be  assumed that Portuguese banks have a clear notion of the origin of the Dos Santos wealth and can vouch for its legitimacy. If this is not the case, in the event that political changes happen in Angola, Portuguese banks will be responsible for ignoring the guides for due diligence. They will not only have to pay hefty fines but will also have to compensate the Angolan people.

Still on the matter of bank finance, there is a third question.  What guarantees did Winterfell give to the banks? We know that this dormant entity has a capital of 50,000 Euros. It is, therefore, not able to get a million-dollar loan – let alone a multi-million–dollar loan.  Who gave guarantees? Was it the Angolan state? Was it Isabel dos Santos? Was it shares that would be coming from Efacec?

Father and daughter

The Angolan state and the daughter of the president of Angola buy a company that will be buying machinery for dams in Angola in part with loans from Portuguese banks that are dominated by the same Angolans – father and daughter.  Should an operation of this kind not have been transparent? Is it enough just to issue a communique so Expresso could report on a consortium of Portuguese banks which had partially financed the operation? There are still many doubts.

Winterfell was financed in part by Portuguese banks .  The other part was financed by the Angolan state through ENDE – National Electricity Company. In the middle of this, is Winterfell where Isabel dos Santos and her father (the Angolan state) meet.

Winterfell was founded in 2014 at Funchal in Portugal. On June 3 2015, Niara Holdings, which owns Winterfell and has a capital of 1,000 Euros, sold to ENDE 800 shares, which corresponds to forty percent of the capital. Curiously, this sale was made before the presidential decree of August 18, which authorized the sale.  This means that the Angolan public company got involved with Winterfell’s capital before the presidential decree.  This is obviously illegal.

Why the hurry? A possible answer is that the financial might of the Angolan state needed to be involved in the purchase of Efacec.  Without the state, the operation would not have been possible – and this is why ENDE had to make a move before the presidential decree.  This is an issue that will have to be studied by Angolan management and legal experts.  Could the operation not be valid for lacking legal support?

Currently, Winterfell has two partners: Niara Holdings and ENDE.  Niara Holdings is a company owned by a single person, Isabel dos Santos, and is registered in Funchal.  Its director is Mario Leite da Silva who is also a director of BPI and board chairman of Santoro (which has shares in BPI) and also director of Winterfell.  Is there not a conflict of interest here, considering that BPI financed Winterfell?

Mario Leite da Silva is a Portuguese national.  He is an expert in auditing and management; he started off working at the Amorim Group and today is key player in Isabel dos Santos’s operations.  He has links to the Portuguese Social Democratic Party (PSD).

The directors of Winterfell, apart from Mario Leite, are Isabel dos Santos, Noel Scicluna, Edward Carbone. The last two have residency in Malta where the operation is being carried out. The first Maltese is a lawyer in Valetta, the capital of Malta, where he is a specialist in legal and financial matters.  The second, Carbone, is an accountant, and former president of the Matese Authority for Financial Services.  He is now in the private sector where he has become director of various companies.  He is currently semi-retired.

What is curious is that there is no single director who is linked to ENDE.  Could it be that Isabel dos Santos represents the interests of the Angolan state company?

And why the small island of Malta when Isabel’s offshore companies are based in Madeira?

This brings me to the case of Diezani Alison-Madueke, the former Nigerian oil minister under President Goodluck Jonathan who was detained in London on October 2. She has been accused to diverting state funds from the oil sector in Nigeria (the largest oil producer in Africa) and managing to launder them with the help of accomplices. According to the investigation, Malta seems to have been Diezani’s preference as an offshore haven to hide the origins of stolen money.

Isabel dos Santos’ buying of Efacec is so opaque that feeble press releases will not help clear the issue.