Mystery of Arafat’s missing millions

Yasser Arafat’s wife and Palestinian officials are fighting over his money before he has even been buried, but the problems is that they have to find it first, writes Paul O’Brien.

Suha Arafat and her daughter Zahwa, left, and the Bristol Hotel, in Paris, above, where it has been reported they are living at a cost of €12,500 a day.

Yasser Arafat’s wife and Palestinian officials are fighting over his money before he has even been buried, but the problem is that they have to find it first, writes Paul O’Brien

Mystery of Arafat’s missing millions

AT THE five-star Bristol Hotel in Paris, the cheapest room rates start at €580 a night off-season. Suites and apartments are priced from €1,280 upwards. The cost of the hotel’s “prestige” apartments is not listed on its website. If you have to ask the price, as the old saying goes, you probably can’t afford it.

Yasser Arafat’s wife Suha has no such problems. Up to the time of her husband’s death yesterday morning, Suha was receiving $100,000 (€77,000) a month from the Palestinian budget and using it to live lavishly in Paris with the couple’s nine-year-old daughter, Zahwa.

Last November, US television network CBS investigated the Arafats’ wealth. It reported that Suha Arafat’s chosen residence for more than a year was the Bristol Hotel, where she occupied an entire floor. Estimated cost? Approximately €12,500 a night. The hotel denied ever seeing her.

What is certain is that, last year, Suha Arafat bought her second property in Paris: an exclusive apartment in the 16th arrondissement, regarded as the wealthiest part of the city.

And that, earlier this year, French authorities launched an investigation into alleged multi-million-dollar transfers from a Swiss bank into two of her accounts. The transfers were believed to total $11.4 million (€8.8m). Unsurprisingly, Suha Arafat has refused to discuss the matter with reporters.

The questions surrounding Mrs Arafat’s income are just part of the wider mystery surrounding the financial empire of her late husband, an empire built over four decades, and always shrouded in secrecy.

Investments were made in numerous companies, such as Coca-Cola, and venture capital funds in the US and the Cayman Islands. The profits accrued were stashed in bank accounts across the globe.

No one knows for sure how much the late Mr Arafat’s portfolio is worth. Estimates have ranged from several hundred million to several billion.

Forbes put him sixth in its 2003 list of richest “kings, queens and despots”, giving him a personal fortune of “at least” $300m (€230m).

A much-cited Israeli intelligence report prior to that put his wealth at $1.3 billion (€1bn). However, Palestinian officials loyal to their leader dismissed this as “propaganda”.

It was harder to dismiss the claims of Jaweed al-Ghussein, a former finance minister for Mr Arafat’s Palestinian Liberation Organisation (PLO). He told the Associated Press the empire was worth between $3bn (€2.3bn) and $5bn (€3.9bn) when he quit in 1996.

Common to almost all the estimates was the difficulty in assessing how much of the portfolio was being used or invested by Mr Arafat for public causes, and how much was going directly into his own pocket.

Only Mr Arafat could say for sure, but he knew better than to divulge information. He kept his tight grip on power by keeping an equally tight grip on the money.

It accrued impressively, and included payments made to the PLO by Arab neighbours supportive of Mr Arafat, taxes imposed on the Palestinian people, and Western aid to his self-rule government, the Palestinian Authority (PA).

The amount of international aid was particularly significant: more than $6.5bn (€5bn) of it given between 1994 and 2003 by countries encouraged by the fledgling peace process.

Yet allegations of corruption and money-laundering, within both the PLO and the PA, were never far away. Mr Arafat’s patronage system, in particular, drew opprobrium. “He is always ready to pull money out of his pocket to buy people,” noted Said Aburish, an Arafat biographer.

Nonetheless, Mr Arafat was able to resist proper accounting for the funds - at least, that was, until 2002.

Then, under severe pressure from the US and Europe, he appointed a new finance minister, a US-educated Palestinian economist, Dr Salam Fayyad, who immediately made his stance clear.

“I am here to tell you it’s not Mr Arafat’s money anymore,” he told Forbes. “I’m not going to accept anything but total transparency.”

Mr Arafat’s control on the purse strings was almost immediately weakened following Dr Fayyad’s appointment in July of that year.

He first consolidated all PA funds into one single treasury account under his control. The following December, the PA annual budget was publicly disclosed for the first time. Mr Arafat’s office was given a sum of $74m (€57m) for the year, and auditors were hired to monitor how it was spent.

Last year, $900m of PA income, which the International Monetary Fund had reported went directly into one of Mr Arafat’s personal accounts, was recovered under Dr Fayyad’s beady eye.

FOR ALL that, though, it is believed hundreds of millions remain hidden, and with Mr Arafat’s death, only his closest confidant, financial adviser Mohammed Rashid, has a reasonable picture of the vast network of accounts, holding companies and stocks involved.

Which is where Suha Arafat comes back in. She feels she is entitled to at least part of the money, and this week reportedly instructed Mr Rashid to draw up a comprehensive list of Mr Arafat’s assets.

But, according to the Al-Jazeera news station, Mr Rashid refused, saying he would report only to the PA.

That a battle could begin for Mr Arafat’s money before he is even buried may appear unseemly.

Yet, in truth, it had been one of the underlying issues ever since his transfer to Paris.

Palestinian officials have already speculated that it may have been part of the reason for Mrs Arafat’s explosive outburst against three of her husband’s top lieutenants in the days leading up to his death.

Ahmed Qureia, Mahmoud Abbas and Nabil Shaath were coming to the hospital, she said, because they wanted to “bury Arafat alive”.

It remains to be seen what level of financial support Mrs Arafat will receive in the post-Arafat era. Being the wife of their revered former leader, the Palestinians will not cut her off, but the largesse may not continue.

As for the rest of Mr Arafat’s money? Palestinian parliamentary officials are in no doubt as to where it should revert.

“It’s the money of the Palestinian people,” said deputy parliament speaker Hassan Khreishe.

But they’ve got to find it first.