Just How Did Mubarak Get So Rich? It’s A Family Affair
When you have one family in charge, soaking everyone in Egypt for the right to do business, why, I can see how people might get a little angry about that : Mubarak — who stepped down on Friday in the wake of massive protests that have gripped Cairo and Alexandria for weeks — and his family have a net worth of at least $5 billion , analysts tell The Huffington Post. Recent media reports pegging the family fortune at between $40 and $70 billion are considered to be exaggerated. Much of their fortune has reportedly been invested in offshore bank accounts in Europe and in upscale real estate. On Friday, Switzerland froze accounts possibly belonging to Mubarak and his family, a spokesman told Reuters, under new laws governing ill-gotten gains. Last month, the Swiss froze the accounts of Mubarak’s ally, ousted Tunisian president Zine El Abidine Ben Ali, whose overthrow inspired the first protests in Cairo. The Mubarak family reportedly owns properties around the world, from London and Paris to New York and Beverly Hills. In addition to homes in the Red Sea resort of Sharm al-Sheikh and the upscale Cairo district of Heliopolis, they also have a six-story mansion in the Knightsbridge section of London, a house near the Bois de Bologne in Paris and two yachts. Largely through Mubarak’s two sons, Gamal and Alaa, the family controls a network of companies that earn money through concessions wrangled from foreign companies that do business in Egypt, according to prominent businessmen and “Corruption In Egypt: The Black Cloud Is Not Disappearing,” an investigative report compiled in 2006 by a coalition of opposition groups. (The report, which names the companies allegedly owned by the Mubarak brothers and details multiple instance of corruption by government officials, has been cited by numerous international good government groups, such as Transparency International, but it was taken offline and is no longer available on the Internet. The Huffington Post obtained a copy, replete with rhetorical flourishes and thinly-sourced allegations, which is available here .) “Egypt’s state under Mubarak’s regime is an embodiment of corruption,” concludes the report, with descriptions of numerous allegations of corruption involving bribery, undue influence and nepotism. In the 1980s, Mubarak seemed sincere in his desire to crack down on corruption in an effort to distinguish himself from Sadat, says an Egyptian-American businessman who often does business in the country. “But as time went on, the cronies around him started taking advantage of the system,” he says. “And the other factor was his children got into business, taking commissions out of each and every company that comes to Egypt. The way they have amassed that money is not by stealing but by ensuring that businesses that want to operate in Egypt pay from 5 percent to 20 percent commission to a company formed by Gamal Mubarak. I know businessmen who have been squeezed this way.” Some of the family’s wealth is also believed to be through partnerships with foreign companies — under Egyptian law, foreign businesses are required to give a local partners a 51-percent stake in their Egyptian operations. “According to this law, any multinational company needs to have a local sponsor, and this local sponsor usually goes through members of the family or powerful people in the ruling party,” says Aladdin Elaasar, the author of “Last Pharaoh: Mubarak and the Uncertain Future.”
Just How Did Mubarak Get So Rich? It’s A Family Affair
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on February 12, 2011. Filed under