Transcript

The Luanda Leaks

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NARRATOR:

Paris, September 2019.

NARRATOR:

The International Consortium of Investigative Journalists has gathered together reporters from almost 40 organizations, including FRONTLINE, to collaborate on a new investigation.

MALE SPEAKER:

So our first two guests are the people who actually brought us the documents. We have the two principals of the organization here—

NARRATOR:

They’ve been given a cache of leaked documents by a group called the Platform to Protect Whistleblowers in Africa. The 700,000 files, known as the Luanda Leaks, are all related to the business interests of Angolan billionaire Isabel dos Santos. Contracts, loan agreements, bank transfers, invoices, emails—documents mapping the complex structure of her business empire.

New York Times investigative reporter Michael Forsythe is part of the collaboration.

MICHAEL FORSYTHE, The New York Times:

The story of Isabel dos Santos has been out there for a few years. There have been in these reports about potential corruption, this accumulating wealth from Angola. But these documents I think really kind of connect the dots and document a lot of that.

NARRATOR:

Isabel dos Santos is one of the world’s richest women. She has properties in Dubai, London, Lisbon; a yacht; and celebrity friends. With interests in banking, mobile phone companies and oil, she is reported to be worth more than $2 billion.

She’s always said she’s earned it on her own.

BBC World 2015

ISABEL DOS SANTOS:

I think that Angola is merit-driven, so whatever I have achieved there I think it has been through merit. I’ve also started working a very long time ago, so [Laughs] over two decades ago, and the success that I have today is not something that came overnight.

NARRATOR:

But there’s another side to her story. She’s the daughter of José Eduardo dos Santos. For 38 years he was president of Angola. Under his rule much of the population lived in extreme poverty while the country was widely reported to be one of the most corrupt in the world.

Tom Burgis is a reporter who’s investigated the dos Santos family.

TOM BURGIS, Financial Times:

A lot of the people around José Eduardo Dos Santos have become immensely rich—family members, generals, senior politicians, people who run the oil industry. They have all used those positions for massive self-enrichment at the cost of the ordinary Angolan.

NARRATOR:

In 2017, President dos Santos stepped down.

The new Angolan government has now opened a criminal investigation into Isabel dos Santos and frozen her assets, saying that she and her husband are responsible for more than $1 billion in lost state funds.

She denies any wrongdoing and says she is being politically persecuted.

TOM BURGIS:

So all of this boils down to, is Isabel what she says she is, self-made billionaire, or is she the creature of a kleptocratic corrupt dictatorship?

NARRATOR:

For more than six months, FRONTLINE and the team of reporters working with the ICIJ have been examining and verifying the leaked documents, investigating how Isabel dos Santos made her money.

Luanda, Angola

NARRATOR:

The story of her fortune is tied to Angola’s most precious natural resource: oil.

Sonangol is the country’s state oil company.

RAFAEL MARQUES, Angolan journalist:

Sonangol is the lifeline of Angola. Over 90% of Angola’s exports come from oil, Sonangol. So, it's essentially the heart that pumps blood to our vessels.

NARRATOR:

Rafael Marques is a journalist who’s been reporting on Isabel dos Santos for more than a decade.

RAFAEL MARQUES:

Essentially the way Isabel dos Santos built her fortune was by using her father’s position and by using also Sonangol as her cash cow and private bank to finance her activities.

NARRATOR:

In 2006, Isabel dos Santos and her husband made a lucrative deal with Sonangol.

Promotional video

NARRATOR:

Sonangol owned a stake in the profitable Portuguese energy company Galp and agreed to sell them 40% of it. The documents reveal that the terms of the deal were highly favorable to the daughter of the president. The price for the Galp share was 75 million euros. But Isabel dos Santos paid just 11.2 million euros, or 15% up front. The remaining 63 million was deferred—in effect, a loan from the state oil company.

Tom Keatinge, an expert in financial crime, has examined the ICIJ documents.

TOM KEATINGE, Director, Centre for Financial Crime and Security Studies:

So you look at any transaction and the first question you should ask yourself is, "Why?" Why did she get a great deal from the state oil company? Was it simply a way of transferring value to the daughter of the president? I think it is impossible to come to any other conclusion than she has benefited from state funds.

NARRATOR:

Isabel dos Santos’ stake in Galp is now worth around $800 million.

She declined to be interviewed by the ICIJ and its partners, but shortly before broadcast she spoke to BBC News reporter Andrew Harding and defended the deal.

ISABEL DOS SANTOS:

All of those transactions are perfectly legal transactions, commercial transactions that were engaged by commercial companies, according to the law. There's absolutely no wrongdoing in any of those transactions.

NARRATOR:

She says Sonangol’s investment in Galp was her idea in the first place, and it’s been a windfall for Angola, too.

ISABEL DOS SANTOS:

This investment is the investment that in history has generated the most benefit for the national oil company.

NARRATOR:

More than a decade later, dos Santos and the new Angolan government are fighting over the terms of repaying the loan she was extended. But the deal remains emblematic of how she has used her position and public money to amass her fortune.

TOM BURGIS:

It's one of the clearest examples of the interests of the state blurring with her own interests, and that is the opposite of the narrative she wants to put forward about herself.

NARRATOR:

In the years that followed, the documents show how Isabel dos Santos and her husband set up a network of companies in tax and secrecy havens for their growing wealth. Then they made a major move into another of Angola’s most lucrative industries: diamonds.

As with the oil deal, they used public money to do so.

In 2012, dos Santos’ husband, Sindika Dokolo, partnered with the state-run diamond company, Sodiam. Together they bought the luxury Swiss jeweler De Grisogono.

It was structured as a 50-50 partnership with Sodiam. But the documents show that by mid-2013, while Sodiam had paid $79.5 million, Sindika Dokolo’s company initially had only put in $4 million—and he’d gotten that from state-owned Sodiam as a "success fee" for brokering the deal.

TOM KEATINGE:

So the state ends up funding an opportunity for Isabel dos Santos and her husband to make an acquisition from which they obviously will benefit. It’s a classic example of somebody close to—in this case the daughter of the president—being able to use that relationship to benefit themselves.

NARRATOR:

The documents reveal a further twist. In order to finance the deal, Sodiam had to borrow the money. It got it at 9% interest from a bank partly owned by Isabel dos Santos.

And the president himself signed a decree guaranteeing that the government would pay back his daughter’s bank if Sodiam couldn’t.

NARRATOR:

Andrew Feinstein investigates corruption cases for a British advocacy group.

ANDREW FEINSTEIN, Corruption Watch:

In effect what is happening here is that the president of a country is guaranteeing a loan to his own daughter's bank in order for the daughter's husband to gain a very lucrative stake in a Swiss-owned jewelry company.

Promotional video

NARRATOR:

The documents also show that the deal gave Sindika Dokolo control of the company. Under his watch, De Grisogono hosted and paid for lavish celebrity parties at the Cannes Film Festival.

ANDREW FEINSTEIN:

Let us not forget that the money being used is money that belongs to the people of Angola. The majority of those people live in abject poverty.

NARRATOR:

Through his lawyers, Sindika Dokolo defended the deal and said the parties were a long-standing marketing practice to promote the luxury brand. He also said he went on to invest more than $115 million of his own money into the company.

For her part, Isabel dos Santos says she had no role in De Grisogono.

ISABEL DOS SANTOS:

Well, I'm not a shareholder in De Grisogono. I've said that many times, and I'll repeat that again: I'm not a shareholder in De Grisogono, so any matters on that I would not be able to answer simply by the simple fact that I'm not a shareholder.

NARRATOR:

But the documents do show she had personal ties to the company. These bank forms list her as an economic beneficiary—and an owner—of a holding company that controls De Grisogono.

The diamond deal is now at the heart of the Angolan government’s investigation into Isabel dos Santos. The current head of Sodiam says the deal has been a disaster for the Angolan people.

EUGÉNIO DA ROSA, CEO, Sodiam:

[Speaking Portuguese] Sodiam is a state-owned company. Therefore it was expected that, from this investment, there would be profits generated for the state treasury. But what really happened was that from 2011, 2012, from the time that the participation of Sodiam was signed, the state has not profited one single dollar.

MICHAEL FORSYTHE:

OK, and if there's a way, if he's not there, is there anyone I can leave a message with, or a voicemail, or something like that for him?

NARRATOR:

As part of the ICIJ collaboration, New York Times reporter Michael Forsythe has come to Portugal’s capital, Lisbon, to investigate the role American companies have played in Isabel dos Santos’ ventures.

MICHAEL FORSYTHE:

I'm looking at the enablers, basically the international group of very respectable companies, accountants, consultants and law firms and banks that have helped her set up companies around the world to facilitate all her transactions, to get money out of Angola and into the bloodstream of the global financial system.

It’s American companies that are legitimizing the rise in wealth of this person, Isabel dos Santos, daughter of the longtime president, making her richer and using Angolan state money to do it.

NARRATOR:

When Sindika Dokolo first bought into De Grisogono, it was in financial trouble.

This letter and organizational chart reveal that he hired the U.S. management firm Boston Consulting Group to help turn it around.

MICHAEL FORSYTHE:

We know from the documents that many banks were—stayed away from her, the international banks, because there are very strict anti-corruption rules and they have lots of compliance officers. And we see from the emails that they were reluctant to do business with her.

But Boston Consulting Group was not. Why did they agree to work with this person, Isabel dos Santos?

NARRATOR:

In fact, some of the consultants went on to leave BCG and become the jewelry company’s top executives. One of them, now based in Lisbon, has agreed to meet Forsythe off-camera.

But it doesn’t go well.

MICHAEL FORSYTHE:

When I told him that I wanted to talk about De Grisogono, the jewelry company, and Isabel dos Santos, he froze up. He said, "I have a confidentiality agreement. I don't like to talk about that."

He was clear that he was quite scared, I thought. And he got up very quickly, though, and said, "Sorry, I can't talk to you," and left right away.

While that's not the best outcome for an interview, obviously, it did give me the impression of how sensitive this issue is.

NARRATOR:

Back in the United States, Forsythe gets an official response from Boston Consulting Group. They say they only worked with De Grisogono for a short time, on three specific projects.

MICHAEL FORSYTHE:

So, they're downplaying their role. But since then I've had a chance to talk to some of the ex-Boston Consulting Group people. One of the guys I talked to said, "Yeah, basically, it's called 'shadow management,'" is the term he used. That we're going in and kind of pulling the strings, I guess, getting this company back in order.

NARRATOR:

BCG says it took steps "to ensure compliance with established policies and avoid corruption under the risks." But consulting firms aren’t bound by the same strict regulations as banks concerning the political backgrounds of their clients and the provenance of their money.

TOM KEATINGE:

Companies like BCG, in this case, are providing a veneer of respectability that makes what's happening acceptable or more acceptable than it might otherwise be.

NARRATOR:

BCG wasn’t the only Western company involved in the dos Santos business empire. One big accounting firm, PricewaterhouseCoopers, has played a major role.

They had an inside view of the De Grisogono diamond deal: They were responsible for auditing the millions of dollars going in and out of the company. The documents show how PwC was aware there was no paperwork for some of that money, and that there were other accounting irregularities.

TOM KEATINGE:

So if I was at PwC, I’d be conducting a pretty thorough audit of what decisions were made, and in hindsight, actually, did we make the wrong decision to accept this business, and should we have reported what we had been presented with?

NARRATOR:

PwC says it is investigating the serious and concerning allegations and has terminated all work for the dos Santos family. PwC's global chairman says employees may be fired.

In 2013, one year after the diamond deal, Isabel dos Santos moved to extend her business empire with a major land development project in her home country.

As part of the ICIJ collaboration, Portuguese journalist Micael Pereira has come to Angola to investigate the deal.

MICAEL PEREIRA, Expresso newspaper:

So there will be a boulevard here. And beyond the boulevard there will be really beautiful buildings and gardens, luxury residences that are—that were conceived by a company of Isabel dos Santos together with foreign companies.

NARRATOR:

The Angolan government would award contracts for the project to two companies owned by Isabel dos Santos; the plans were authorized by her father. These letters, contracts and emails show her companies stood to make hundreds of millions of dollars.

In her BBC interview, she said the project included new roads to alleviate chronic traffic in the capital city.

ISABEL DOS SANTOS:

This is a project that would have made a difference to Luanda, but most of all this is a solution that we proposed because it's a solution that in terms of cost and return and benefits to the city of Luanda and to the people of Luanda, it has very high social benefits.

NARRATOR:

But the land, long the site of other development plans, had people living on it.

Weeks after the president approved his daughter’s plan, the residents were evicted.

MALE SPEAKER:

[Speaking Portuguese] We were surprised at dawn. It was around 4 o’clock in the morning. There was an order to demolish the entire neighborhood. No negotiation. No warning, nothing. No talk.

NARRATOR:

Around 500 families settled on this strip across from their former homes.

MICAEL PEREIRA:

I've never been in a place like this. This is shocking. These people live among all this garbage. They built their houses where they could. They live basically between two sewage systems in the open air.

NARRATOR:

The residents say cholera, TB and malaria are rife.

FATIMA:

[Speaking Portuguese] This is the bed of the other family.

NARRATOR:

Fatima and her children live here with four other families.

FATIMA:

[Speaking Portuguese] If the government or someone in good faith who saw how we are living here, or if someone with money could share with us, we would be very grateful, [Crying] because our life here is not good. It is not at all acceptable. It is impossible for four, five or six families to live in a shack. I just want someone, I want God to touch someone’s heart.

NARRATOR:

Isabel dos Santos and her lawyers say her plan was designed to avoid any evictions, using “reclaimed land from the sea.” But the documents contain maps that show her development covered the area where the evicted families used to live.

The new Angolan government would ultimately remove Isabel dos Santos from the project. The development remains unbuilt.

Around the same time as the land deal, Angola’s oil industry was in trouble. Prices were falling, and there were management issues at Sonangol. To fix the problems, the president turned to his daughter. Her lawyers helped draft a presidential decree establishing a commission to restructure Sonangol. Then one of her offshore companies was hired to do the work.

ANDREW FEINSTEIN:

So, here is a transaction in which a company owned by the daughter of the president wins the contract to restructure Sonangol, the most important state-owned company in Angola. You've got to ask yourself the question, "Why would Sonangol employ a company paid through Malta—which is an offshore jurisdiction, very opaque, very problematic—to provide advice and services to it?"

NARRATOR:

The documents show that dos Santos’ company would be paid 8.5 million euros for its work. The company kept a lot of that money, though it subcontracted to consultants like BCG to help with the Sonangol restructuring.

Through her lawyers, Isabel Dos Santos said the government chose her company because “she is one of very few Angolans with substantial international business experience.”

Her involvement in Sonangol would soon go much deeper. In June 2016, as the company was being restructured, President dos Santos fired Sonangol’s board and put his daughter in charge.

ANDREW FEINSTEIN:

We need to understand here that President dos Santos passed a presidential decree. He, as the supreme law in the land, passes a law to make her the head of Sonangol, the state oil company. It is a blatant and brazen move using his almost total political power to benefit himself and his family.

NARRATOR:

Again, Isabel dos Santos rejects such criticism.

ANDREW HARDING:

Your father had put you in that position.

ISABEL DOS SANTOS:

No, it wasn't my father, it was the government, but anyway. [Laughs] We can go through that. It was the commission—

ANDREW HARDING:

At the time when your father was the president.

ISABEL DOS SANTOS:

It was the commission of—I was invited to head Sonangol by the commission of oil and gas restructuring. I worked for them as a consultant, that then, after I finished my consultancy work, invited me and said would I consider the position to become Sonangol's chairperson.

NARRATOR:

Her role as chairperson wouldn’t last long. By September 2017, everything was changing for the dos Santos family. Her father was now out of power, and the new president was launching an anti-corruption drive. Within weeks, he sacked Isabel dos Santos as the head of Sonangol.

The new government would soon open a criminal investigation into millions of dollars in payments made in her last hours at Sonangol. The money was sent to a company here in Dubai called Matter Business Solutions.

The documents show that Matter was a consulting company that Isabel dos Santos’ longtime business manager helped run and that its sole shareholder was a friend named Paula Oliveira.

TOM KEATINGE:

There is clear relationship between Isabel dos Santos and the company we are talking about, and indeed the owner of that company, who is a friend of Isabel dos Santos. So, is it a legal relationship? No. Is there a relationship in the way that most people would consider a relationship to be? Absolutely.

NARRATOR:

Matter sent a stream of invoices to Sonangol. Some had little detail about what the bills were for.

This one says "Support the chairman in communications"—384,000 euros. And this one for unspecified "expenses”—472,000 euros. The payment orders bear Isabel dos Santos’ signature. One of them, for $38 million, was on the day she was ousted. The next day, a total of $57.8 million was withdrawn from one of Sonangol’s bank accounts and sent to Matter.

Both Oliveira and dos Santos insist Matter was an independent and legitimate firm, not a dos Santos proxy, that was owed money for substantial work it did for Sonangol. Oliveira’s lawyers say she sent the invoices when she learned dos Santos was being fired.

In her interview with the BBC, dos Santos stressed that the payments were to settle outstanding bills.

ISABEL DOS SANTOS:

All the services rendered under the contract are known services, and they were delivered and rendered, and all the invoices are invoices that are connected to services rendered.

The contract is a contract that was well known to the Angolan government authorities. They knew everybody that worked on the project; they met with them on a regular basis.

ANDREW HARDING:

We've received copies of these invoices for the $57 million, and I wondered if I could show you some of them and ask you to explain—

ISABEL DOS SANTOS:

Well, I will not be familiar with the invoices themselves.

ANDREW HARDING:

Here, for instance, for 472 thousand euros, and there's no explanation for what these expenses are. It's—

ISABEL DOS SANTOS:

Well, I would not be familiar with the—

ANDREW HARDING:

But you signed off on these.

ISABEL DOS SANTOS:

Well, the way Sonangol works—and this is—

ANDREW HARDING:

And again, if I can, two here, almost identical for 676,000, and then again for 676,000, and again, very vague accounting here, and explanations—

ISABEL DOS SANTOS:

Well, I'm—are you sure that there are no more documents that should be supplied to you and they're probably not in here? Because it looks to me—

ANDREW HARDING:

There are many more, there are many more. And the concern is—

ISABEL DOS SANTOS:

Well—well, that's what I'm saying. That's why it looks to me—

ANDREW HARDING:

—that this fits in with the explanation or the allegation from the Angolan authorities that essentially the funds were being looted at the last minute.

ISABEL DOS SANTOS:

Of course they were not, of course not. That doesn't—that doesn't make any sense.

NARRATOR:

Dos Santos left Angola as the criminal investigation of her was getting underway.

Authorities there say they want her back.

HELDER PITTA GROZ, Attorney general:

[Speaking Portuguese] Well, there are facts that I would say yes, we think are criminal offenses that have to do with her mismanagement, greedy management, poor management, also money laundering situations, some business with herself. So a number of questions come up during the inquiry and from the evidence that we got later. So that's why we need to hear from her.

NARRATOR:

In late December, after ICIJ reporters submitted questions, the Angolan government froze the assets of dos Santos and her husband. Angolan authorities are now going through the many years of dos Santos' deals; they say they are being helped by the U.S., U.K., Portugal and others.

According to the new president, Isabel dos Santos and Sindika Dokolo could face prison time. The couple insists that the investigations and leaked documents are all part of a coordinated political attack.

ISABEL DOS SANTOS:

Angolan authorities have embarked on a very, very selective witch hunt. A very selective witch hunt that suits the purpose of saying that there is two or three people that are related to the family, or a family of President dos Santos. Now, look, I regret that Angola has chosen this path. I think that we all stand a lot to lose.

NARRATOR:

For many Angolans, this is a watershed moment.

RAFAEL MARQUES:

Isabel dos Santos has billions of dollars. It's only a matter of time before the Angolan state comes in full force to reclaim what belongs to the Angolan people.

We need that money to get to a new place. We need those resources to change the way we think about what a government is for, what ruling is about and how to serve the country and the people.

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