Taint of Corruption Is No Barrier to U.S. Visa - NYTimes.com

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By IAN URBINA

Several times a year, Teodoro Nguema Obiang arrives at the doorstep of the United States from his home in Equatorial Guinea, on his way to his $35 million estate in Malibu, Calif., his fleet of luxury cars, his speedboats and private jet. And he is always let into the country.

The nation’s doors are open to Mr. Obiang, the forest and agriculture minister of Equatorial Guinea and the son of its president, even though federal law enforcement officials believe that “most if not all” of his wealth comes from corruption related to the extensive oil and gas reserves discovered more than a decade and a half ago off the coast of his tiny West African country, according to internal Justice Department and Immigration and Customs Enforcement documents.

And they are open despite a federal law and a presidential proclamation that prohibit corrupt foreign officials and their families from receiving American visas. The measures require only credible evidence of corruption, not a conviction of it.

Susan Pittman, a spokeswoman for the Bureau of International Narcotics and Law Enforcement in the State Department, said she was prohibited from discussing specific visa decisions. But other former and current State Department officials said Equatorial Guinea’s close ties to the American oil industry were the reason for the lax enforcement of the law. Production of the country’s nearly 400,000 barrels of oil a day is dominated by American companies like ExxonMobil, Hess and Marathon.

“Of course it’s because of oil,” said John Bennett, the United States ambassador to Equatorial Guinea from 1991 to 1994, adding that Washington has turned a blind eye to the Obiangs’ corruption and repression because of its dependence on the country for natural resources. He noted that officials of Zimbabwe are barred from the United States.

“Both countries are severely repressive,” said Mr. Bennett, who is now a senior foreign affairs officer for the State Department in Baghdad. “But if Zimbabwe had Equatorial Guinea’s oil, Zimbabwean officials wouldn’t still be blocked from the U.S.”

Shown the Justice Department documents that detail the accusations of corruption against Mr. Obiang, Senator Patrick J. Leahy, a Vermont Democrat who wrote the law restricting visas, expressed frustration and anger with the State Department, which is responsible for issuing visas.

“The fact that someone like Mr. Obiang continues to travel freely here suggests strongly that the State Department is not yet applying the law as vigorously as Congress intended,” Mr. Leahy said. The law was partly inspired by the accusations of corruption surrounding Mr. Obiang’s family and the Equatorial Guinean government, Mr. Leahy’s staff said.

“There are many instances of corrupt foreign officials plundering the natural resources of their countries for their own use while their people starve,” Mr. Leahy said. “The law states clearly that if you do that, you are no longer welcome in the United States.”

Daniel Whitman, who retired in September as the deputy director of the Office of Public Diplomacy and Public Affairs in the Bureau of African Affairs at the State Department, agreed that the law should be used more forcefully. “We just seem to lack the backbone to use this prohibition,” Mr. Whitman said. “In the rare cases it is used, no one at State was willing to talk about it.”

When asked how many times the laws have been used to bar corrupt foreign officials from entering the country, State Department officials declined to answer, citing privacy reasons, though Ms. Pittman said thousands of visas had been denied to corrupt officials using other legal means. A 2007 State Department report said the presidential proclamation, signed by President George W. Bush in 2004, had been used “dozens” of times.

A State Department official who handles corruption investigations said that while the measures were important tools, the department as a matter of policy did not want to reveal the number of times they had been used because it would show that the number was actually quite small. The official asked not to be identified because of departmental rules barring public comment.

The Justice Department memorandum, dated Sept. 4, 2007, and obtained by The New York Times, said the government believed Mr. Obiang’s assets were derived “from extortion, theft of public funds or other corrupt conduct.” From April 2005 to April 2006, the memorandum said, Mr. Obiang funneled at least $73 million into the United States, using shell corporations and offshore bank accounts to launder the money and ultimately buy his Malibu estate and a luxury jet.

The document identified several wire transfers by Mr. Obiang from 2005 and 2006, beginning with a bank in Equatorial Guinea, then going to the central Banque de France and landing in American accounts at Wachovia, Bank of America and UBS. In one six-week period in 2006, Mr. Obiang transferred $33,799,799.99 to the United States, it said, which was used to buy a Gulfstream V jet.

Part of his wealth, the document said, comes from a “revolutionary tax” that Mr. Obiang placed on timber. Instead of sending the payments to the treasury of Equatorial Guinea, Mr. Obiang, who is considered likely to be a successor to his father, has “insisted that the payments be made directly to him,” it said.

In addition, the memorandum said, the Justice Department believes that Mr. Obiang “may be receiving bribes or extortion payments” from the oil companies as a percentage of their contracts.

Spokesmen for ExxonMobil and Marathon said the companies followed all relevant laws. A request for comment from Hess was not answered. The Justice Department declined to comment on the memo.

Another document, prepared by the Immigration and Customs Enforcement division of the Homeland Security Department, said Mr. Obiang “routinely travels to the United States with over $1 million in cash” that he fails to declare, a crime punishable by up to five years in prison. Mr. Obiang regularly visits the country using a diplomatic passport, though he rarely does diplomatic business here, said the I.C.E. document. The document said the immigration agency’s goal was to deny a safe haven to Mr. Obiang and to “identify, trace, freeze and recover assets within the United States illicitly acquired through kleptocracy by Teodoro Obiang and his associates.”

The documents were originally obtained by Global Witness, a British human rights group that monitors corruption in natural resources industries, after they were released in response to a legal complaint filed in France against several African dictators, including Mr. Obiang’s father, President Teodoro Obiang Nguema Mbasogo of Equatorial Guinea. The Justice Department and I.C.E. would neither confirm nor deny the authenticity of the documents.

Through a spokesman at Qorvis Communications, a public relations firm working for the Equatorial Guinean Embassy in Washington, Teodoro Nguema Obiang declined to be interviewed. But his brother denied the charges of corruption.

“This is the problem when a country becomes very successful,” said Gabriel Mbega Obiang Lima, the vice minister of mines, energy and industry and another of the president’s sons. “Everyone assumes us guilty until proven innocent.”

The vice minister said his government had made great strides in dealing with corruption. He cited as an example his country’s participation in the Extractive Industries Transparency Initiative, an international coalition of governments, civil society groups and companies that sets global standards for transparency in oil, gas and mining.

But a 2009 internal document from the initiative says the organization is “particularly concerned about the pace of progress” in Equatorial Guinea. The country has failed to produce a required report regarding its revenue, even though it joined the organization more than three years ago, the report says.

In 2004, President Bush signed a proclamation barring entry to the United States for any foreign officials and their family members “whose misappropriation of public funds” has had serious adverse effects on American businesses or national security interests. Congress followed up in 2007 with a law containing even stronger language, barring entry to anyone “involved in corruption relating to the extraction of natural resources in their countries.”

Otto Reich, who served until 2004 as the United States’ special envoy to the Western Hemisphere, said there was resistance to applying these sorts of prohibitions even before the presidential proclamation was drafted.

“Senior State Department people especially from Africa kept saying that if something like this is used they wouldn’t have anyone to talk to in their home countries,” Mr. Reich said. “It’s politically simply something they do not want to take on.”

The Obiang family and Equatorial Guinea have been the focus of corruption accusations for years. In 2004, a Senate panel accused Riggs Bank in Washington of having “turned a blind eye to evidence suggesting the bank was handling the proceeds of foreign corruption” in accepting hundreds of millions of dollars in deposits from Equatorial Guinea.

Committee investigators found dozens of irregular payments, multiple individual signatories to accounts and even deposits of millions of dollars in shrink-wrapped currency. Riggs Bank was fined more than $25 million for its handling of the Equatorial Guinean and other accounts, and several of the bank’s directors were criminally prosecuted.

But in more recent years millions of dollars of the country’s money has found its way to other American banks, including the ones named in the Justice Department memo. Wachovia and Bank of America, according to the memo, filed suspicious activity reports to the authorities, and ultimately closed all accounts associated with Mr. Obiang and his associates, but not before tens of millions of dollars had already entered the United States.

“These banks appear to have facilitated a grand corruption, and it may even have been done legally,” said Gavin Hayman, director of campaigns for Global Witness. “Those that filed suspicious activity reports may have been complying with their regulatory obligations under the law, but at the same time they went ahead and forwarded transfers of tens of millions of dollars about which they already had suspicions. Effectively, the regulations are allowing banks to earn money from corruption.”

All three banks declined to answer questions about the transactions. Although Wachovia said Mr. Obiang was not a client, the Justice Department documents described how he used third parties to open accounts at some banks.

Since oil was discovered there in 1996, Equatorial Guinea has become the third-largest oil producer in sub-Saharan Africa, after Nigeria and Angola, with estimated revenues of $4.8 billion in 2007. But although petroleum has made the ruling Obiang family and its associates vastly rich, the oil and gas wealth has not been spread beyond ruling elites.

In 2006, more than three-quarters of the population was living below the poverty line, according to a 2009 International Monetary Fund report.

By some measures, conditions in the country are getting worse. Though the nation’s gross domestic product grew more than tenfold from 1990 to 2007, infant mortality rose to 12 percent from 10 percent, according to a 2009 Unicef report.