Moneyland: The Inside Story of the Crooks and Kleptocrats Who Rule the World

by Oliver Bullough

Which brings us back to Paul Manafort. This wholesale looting is only possible because of people like him—Western enablers: lawyers, consultants, lobbyists, accountants and others who move their clients’ money and help them hide it in clever ways. If you try telling an informed Russian that the West is a principled alternative to Vladimir Putin’s Kremlin, he’ll likely ask why then Putin’s propaganda chief was allowed to buy property in Beverly Hills on a bureaucrat’s salary, or why the deputy prime minister owns an apartment within walking distance of London’s House of Commons. This hypocrisy is a gift to Putin, who can not only undermine his opponents by highlighting it, but also use the West’s offshore tools against it: as a conduit for money to fund his security services, to create anti-Western propaganda and to support political extremists favorable to his interests. Corruption is a force multiplier for the West’s enemies, and yet the West continues to accept dirty money into its economies by the billions.

Money flows across frontiers, but laws do not. The rich live globally; the rest of us have borders.

Across England and Wales, more than 100,000 properties are owned offshore, just like Yanukovich’s and Manafort’s properties were. It is impossible to say how many are empty, but perhaps as many as half of the new builds at the top of the market are barely used, according to one study. These are not houses for living in, but house-shaped bank accounts.

This is the first glimpse of the tunnel into Moneyland. It works as follows: first, you obtain money (you might have stolen it, or avoided taxes on it, or simply earned it); then you hide it; then you spend it. Previously, you could take two of the three steps, but never all of them together. You could obtain money, then spend it, but that was risky. Or you could obtain money, then hide it, but that meant it was stuck in Switzerland, and you never got to enjoy it. Moneyland set wealth free, and it didn’t care where that wealth came from: steal, hide, spend, in perpetuity. This is the dirty secret at the heart of eurobonds. It was all made possible by modern communications—the telegram, then the phone, then the telex, then the fax, then the email—and this is the dark side of the revolution of convenience that we call globalization.

When lawyers and accountants released these predatory instruments into the ecosystems of sub-Saharan Africa, Asia and the former Soviet Union, however, the mismatch was total. It was as if tigers had been suddenly introduced to a continent inhabited primarily by large, peaceable, flightless birds. Unprepared tax authorities and underfunded investigators were being asked to resist the most skilled rules dodgers in the world. They didn’t stand a chance.

“Most Uzbeks see Karimova as a greedy, power hungry individual,” wrote American ambassador Jon Purnell in a 2005 cable later released by WikiLeaks. “She remains the single most hated person in the country. (Comment: We have no polling data to support that statement, but we stand by it.)”

Tuberculosis requires specific chemicals delivered in specific quantities. But there was a way to make money here, too: the healthcare insiders cut the amount of chemical in each dose, by pretending the average patient weighed less than he did, and thus saved on the amount of chemicals they needed to buy. The consequence was that the drugs didn’t work, which drove the growth of the multidrug-resistant TB strains that are now such a threat there.

After independence, the new governments maintained the export agencies, nominally to raise capital for industrialization, but in reality just to continue the scams, with the surplus being diverted to cronies now, instead of the old Western masters.

“The failure of Westerners to understand the nature of customary property rights and their embeddedness in kinship groups lies in some measure at the root of many of Africa’s current dysfunctions,” he wrote. “Europeans deliberately empowered a class of rapacious African Big Men, who could tyrannize their fellow tribesmen in a totally non-traditional way as a consequence of the Europeans’ desire to create a system of modern property rights. They thus contributed to the growth of neopatrimonial government after independence.”

The unavoidable conclusion of the success of the 419 scams was that everyone who knew about Nigerian corruption also knew—if only subconsciously—about the Western enabling of that corruption: that the stolen money always ended up in Switzerland, London or somewhere similar.

The bank’s 1997 client profile for Ibrahim and Mohammed Abacha, two sons of the then president of Nigeria (and of the woman who gained enduring fame in the most legendary of all the 419 scams), quite openly stated: “wealth comes from father who accumulated wealth as head of state of major oil producing country.” The 1996 file on Omar Bongo, president of Gabon from 1967 to 2009, was even more straightforward: “Source of Wealth: self-made as a result of position. Country is an oil producer.”

Sadly, however, trying to interest a new editor in a story that has been killed by a lawyer is like trying to interest someone in a dog that has killed its owner.