Private Empire: ExxonMobil and American Power

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Private Empire: ExxonMobil and American Power Page 33

by Steve Coll


  Greg Wales had spent much of 2003 planning for the operation. He had written a number of strategy documents. One of them, entitled “Assisted Regime Change,” had emphasized that it would be important to persuade all of the American oil companies active in Equatorial Guinea that their investments and profits would be protected after a change of government. “Foreign investors are to be reassured,” Wales wrote.2

  Wales was in charge of the coup’s political strategy, particularly in the United States. He traveled to Washington and telephoned the D.C. offices of major oil companies doing business in Equatorial Guinea—as well as other companies that might be interested in moving in. He was vague, but he suggested that political changes might soon be in the offing in Equatorial Guinea.

  He arrived alone for his meeting at the Pentagon. Whelan invited a Defense Department aide to sit in. As Whelan recalled it, the discussion touched generally on the rising importance of oil production in West Africa and the security challenges that seemed to come alongside. They talked about Angola, a major oil producer recovering from a long civil war, as well as the insurgency- and crime-wracked oil-producing regions of the Niger Delta, in Nigeria—“just the whole enchilada,” Whelan recalled.3

  They also addressed Equatorial Guinea. “He made a comment that he thought that Equatorial Guinea was probably not the most stable place in the world,” she remembered. Wales described himself as being in the security and air transport business in Africa. “He said that his colleagues were reporting to him that there were a lot of well-heeled Equato- Guineans . . . that were sort of prepaying or prescheduling flights out of the country in the event of some sort of problem. . . . So that was his one piece of intelligence—if you want to call it that—that the leadership in Equatorial Guinea was nervous, and it appeared that family members were making their plans for a getaway, just in case.”

  That the elite in Equatorial Guinea might be nervous and prebooking flights as a hedge against a coup did not strike her as particularly noteworthy. The country was like a small, unprotected, oil-endowed bank sitting in a bad neighborhood, just waiting to be robbed. During the 1970s, Frederick Forsyth had written his novel The Dogs of War, about a mercenary-led coup in a small African country, while staying at a hotel above Malabo’s harbor; Forsyth himself later became entangled in a stillborn coup attempt against Equatorial Guinea’s dictator. Coup plots seemed to blow through the country like its tropical storms. Leaders of Obiang’s fractured and repressed political opposition were regularly accused by the dictator of fomenting his overthrow. Periodically, the president arrested his own relatives for plotting a move on his palace. In 2002, Obiang had detained and tried dozens of alleged plotters on treason charges. The poor standards of the trial were one reason why the State Department had so far refused Obiang’s pleading for a license to hire M.P.R.I., the Virginia-based security firm, to train his police and military. The United States had earlier approved an M.P.R.I. license for maritime defense on the grounds that the Equatorial Guinean coast guard posed little threat to the country’s citizens and might defend offshore oil platforms owned by ExxonMobil, Marathon, and Hess. Yet the Bush administration judged that training Obiang’s land forces to shore up his dictatorship could not be justified until the government improved its human rights performance.

  Theresa Whelan interpreted Greg Wales’s purpose in visiting her as typical of the hustling, networking world of profit-making consultants in the global security field. “He wanted to make sure that he could say that he had a contact, that he had access to the Pentagon for some purpose in the future, whatever that might be. But I didn’t think that he had a particular agenda, other than making it clear to us that he was a potentially valuable interlocutor,” Whelan concluded. “It was the equivalent of a sales call or a marketing meeting. For our trouble in listening to him, we would get another perspective on the ebb and flow of the political situation in the region.”

  After Wales departed, Whelan made no record of the conversation and distributed no memos or e-mails to Pentagon colleagues, she said. It did not occur to her to do so because the entire encounter had been “pretty unremarkable.”4

  It is not known how Wales assessed the conversation, but it is clear that there was nothing routine about his thinking about the Pentagon’s possible role in his coup plan. His fellow conspirators had the impression that winter, based in part on what Wales told them after traveling to Washington, that the United States might actively support their efforts to seize power—or at least that the Bush administration might not object. It is not clear why such an impression might have developed among the coup planners. Contemporary memos show that Wales and his colleagues knew they faced a risk of alienating the United States, particularly if major oil companies such as ExxonMobil concluded that the change of regime would jeopardize their investments. Threatening American oil interests in Equatorial Guinea, Wales wrote, might be “what gets the Marines coming in.”5

  Simon Mann served as Greg Wales’s principal military partner in the plot under way that summer to overthrow Obiang. He was a lean and poised man in late middle age, a descendant of English cricket captains, who had grown into a formidably successful adventurer. After graduation from Eton, the elite preparatory school, he joined the Special Air Service, Britain’s principal special forces unit. Later he founded Executive Outcomes and Sandline International, part of a network of corporations that provided mercenary military services to African governments in exchange for diamond mining and other business concessions. During the 1990s, Executive Outcomes won contracts with Angola, to battle a formerly anti-Communist rebel movement, and with Sierra Leone, to keep anti-government rebel marauders away from that West African country’s diamond mines. Mann grew wealthy, bought an estate in the English countryside, another in London, and married, apparently intending to settle down. He and his younger wife started a family, but in 2003, when he turned fifty-one, Mann became restless. Eli Calil, a Nigerian-born Lebanese oil trader with extensive contacts in Africa, and Severo Moto, the Equato-Guinean opposition leader in Madrid, recruited him early that year, Mann later said in a Malabo courtroom. “I agreed to do this for the money, yes, but also because I believed it was right,” he said.6

  That spring, Mann learned, he and others involved in the coup planning said later, that Spanish prime minister José María Aznar supported the plan. Aznar, a former Franco supporter who had become a successful conservative politician, oversaw an aggressive foreign policy. On March 17, 2003, on the eve of the invasion of Iraq, he appeared with George W. Bush, British prime minister Tony Blair, and Portugese prime minister José Durão Barroso in the Azores to provide a show of solidarity for the American-led plan to overthrow Saddam Hussein. “We are committed on a day-to-day fight against new threats, such as terrorism, weapons of mass destruction, and tyrannic regimes that do not comply with international law,” Aznar declared. “They threaten all of us, and we must all act, consequently.”7

  “The Spanish PM has met Severo Moto three times,” Mann later wrote, and he indicated that Spain would take concrete steps to support Moto’s installation in power in Malabo if the mercenaries’ coup plan succeeded. “He has, I am told, informed SM that as soon as he is established in EG he will send 3000 Guardia Civil. I have been repeatedly told that the Spanish Govt will support the return of SM immediately and strongly. They will, however, deny that they are aware of any operations of this sort.” As Mann and his colleagues approached their launch date for the coup, Spain dispatched warships bearing marines to the Gulf of Guinea; they attempted to dock in Malabo, but were denied permission. The Spanish foreign minister was quoted as describing the naval deployment as a “mission of cooperation.”8

  Greg Wales’s travels to Washington—his awkward approach to Theresa Whelan at the Pentagon and his unsolicited telephoning of oil companies’ lobbying offices—suggested a strain of amateurism in the plot at odds with Mann’s record of corporate security success during the 1990s. The plan had several prongs. An underco
ver team led by a South African named Nick du Toit infiltrated Malabo in late 2003 in the guise of businessmen. They set up a firm called Triple Option and claimed to be interested in fishing. In fact they carried out reconnaissance and prepared to aid the coup team when it landed at the airport. The main external raiding party would be made up of veteran soldiers from South Africa and Angola. They would streak into Malabo from southern Africa in a transport plane, seize the airport, and then roll toward the presidential palace to capture or kill Obiang. As Du Toit later described it, “The advance group and the arriving mercenaries would meet at Malabo’s airport and then drive to Obiang’s palace, kidnap the president, and then systematically kill all other [Equato-Guinean] ministers. Obiang would be exiled to Spain and a plane would arrive carrying Severo Moto and his supporters to form a new government.” Du Toit would be paid either $1 million or $5 million—there are documents reporting both numbers—if the coup succeeded.9

  Mark Thatcher, the son of Margaret Thatcher, the cold war–era conservative prime minister of Britain, lent the group funds, although he said later that he had been misled about the purpose of his loan and had no idea it was to be used in support of a coup d’état. Soldiers clued in on the plan in South Africa and Equatorial Guinea spoke so loosely about their plans that the British government picked up coup rumors simply by monitoring Africa’s radio services. When Obiang visited South Africa in December 2003, his hosts passed intelligence that he should be watchful. Angola’s government passed him warnings as well. The intelligence was accurate; the coup makers had moved toward a strike that winter.

  Obiang traveled to the United States in February on one of his regular private visits—apart from his occasional medical treatment, he seemed to enjoy spending time in America—and he checked into the Four Seasons hotel in Washington, a modern brown-brick building on the southeastern edge of cobblestoned Georgetown. On a gray Monday afternoon, five executives arrived from Riggs, Obiang’s principal bank, whose branch across from the White House had first attracted the president’s attention as a place where he might store his oil wealth while deepening ties to American corridors of power. Equatorial Guinea’s deposits now totaled about $750 million, by far the largest of any of the bank’s clients.

  Auditors from the regulatory Office of the Comptroller of the Currency were crawling all over Riggs that winter, however. A probe had been sparked by other accounts held at Riggs for Saudi Arabia’s embassy in Washington and for the former Chilean dictator Augusto Pinochet. The regulators were now asking questions about Equatorial Guinea’s accounts. They had recently raised concerns about offshore transactions in the accounts controlled by Obiang. Riggs and its management could face fines or worse if they did not come up with convincing answers. At the Four Seasons, the bank’s delegation announced that it was particularly focused on several relatively modest wire transfers—totaling less than $1 million—to offshore companies that appeared to be linked to Simon Kareri, the Riggs account executive who serviced Obiang.

  Obiang waved them off. The transactions were authorized to support the economic development of his country, he said vaguely. He refused to be drawn on specifics. When the bankers pressed, Obiang sent one of his sons, Gabriel, along with several aides, to go off and review the matter.

  The two delegations bundled into cars and rolled over to Pennsylvania Avenue. Inside the columned Riggs branch, Gabriel looked over the records and explained that some of the transactions involving Kareri had been authorized, but at lesser amounts than had actually been transferred to the offshore accounts. This raised the possibility that someone, possibly Kareri, had been skimming money. The Riggs executives asked what the offshore companies receiving funds actually did. Gabriel was vague.

  The bankers warned him that if he could not provide specific, verifiable descriptions of what the money sent offshore had been used for, Riggs might have to end its entire relationship with Equatorial Guinea, notwithstanding the great financial pain it would cause the bank. In the post–September 11 world it was unacceptable for American banks to host accounts making international wire transfers to unknown front companies, they explained. Nobody was suggesting that Equatorial Guinea was financing terrorists, but the rules were inviolable.

  Gabriel declined to explain. The transfers were “authorized by the government to pay for services,” he said.

  That afternoon, Riggs’s risk management committee met to terminate the bank’s relationship with Obiang. The bank’s executives announced that $40 million in Obiang’s accounts—an amount equal to the balance of his outstanding loans—would be frozen, pending resolution of the debts. The rest of his funds—about $700 million altogether—would be released in the form of cashier’s checks, which authorized individuals, including the president himself, would be free to pick up at the branch across from the White House, so they could hand carry the checks to another bank of their choice for deposit.10

  The Dodson family sold airplanes and parts from hangars and warehouses outside of Kansas City. One way they acquired inventory was by monitoring sales of surplus U.S. government airplanes by the General Services Administration, the agency responsible for federal buildings and property. In 2003, Dodson Aviation, Inc., purchased a 727-100 jet that had been put up for sale on a Web site called GSAAuctions.gov. They spruced the plane up and listed it for resale. About six months passed before an English firm, Logo Logistics, contacted them about a purchase. “Normal business guys in suits” turned up in Kansas to inspect the aircraft, as J. R. Dodson recalled it. They had foreign accents.11

  The Dodsons handled sales through an escrow firm in Oklahoma City—typically, the buyers transferred cash into an escrow account, and when the conditions of the sale were met, the escrow firm released the funds to the Dodsons. The deal for the 727 closed on March 3, 2004; the Dodsons did not know the origins of the cash, only that it had arrived to the satisfaction of the escrow agent.12

  Colleagues of Simon Mann arrived in Kansas and flew the plane to South Africa. They landed at a small airport outside of Pretoria, where Mann and about five dozen mercenaries boarded in darkness.

  From Spain, Severo Moto flew to the Canary Islands. Greg Wales and other conspirators joined him there at the Steigenberger hotel. On March 7, they boarded a leased Beechcraft King Air and lifted off for Africa, intending to rendezvous in the air with Mann’s American-purchased jet. In Malabo, Du Toit’s local recruits prepositioned cars and other vehicles at the airport, so the arriving armed mercenaries would have transport into town. Moto and Wales would circle so as to land in Malabo an hour after the coup plotters arrived and seized the capital. Moto had even written a speech in advance promising to transform Equatorial Guinea into the “star of Africa.”13

  En route, Mann and his crew flew to Harare, the capital of Zimbabwe, where he intended to pick up weapons and fuel before flying on toward Equatorial Guinea.

  They never left the Harare tarmac. Zimbabwe police stormed the plane and arrested all of its passengers; they had been tipped off by South African intelligence. Mann managed to get a phone call through to Du Toit in Malabo to let him know that “problems had arisen.” Mann and his mercenaries were taken to prison and, according to Mann, beaten and tortured into making confessions.14

  In Malabo, Obiang’s security forces arrested Du Toit and many others who had worked with him. They paraded the South African before diplomats and television cameras. He confessed that his purpose was to “carry out a coup against the Obiang regime” and to bring in Severo Moto from Spain “as the country’s new leader.”15

  “The terrorists who have been arrested will go through a fair trial,” Obiang declared to his people. If convicted, however, “because Equatorial Guinea has not abolished the death penalty, we won’t forgive them. If we have to kill them, we will kill them.” He urged his countrymen to watch out for other conspiracies, to “eliminate these terrorists. . . . Whoever presents themselves as a mercenary, there will be no need to let the President know. They must be liquidated
—they must be killed because they are devils.”16

  Obiang might be accustomed to coup plots, but this one was enough to make any insecure, oil-endowed dictator’s head spin. Its external tentacles ran around the world. Spain seemed to be involved—Obiang required little proof to conclude that Madrid was out to get him, but here the evidence looked substantial. There was circumstantial evidence to suggest that the United States might also have been covertly involved—the American origins of the plane carrying the mercenaries was one suggestive indicator, and the common statements of Bush and Aznar about ridding the world of dictators suggested the potential for secret collusion between them. Yet, hadn’t he, Obiang, been generous again and again to ExxonMobil and the other American oil corporations gorging on Equatorial Guinea’s oil? Weren’t his contract terms among the most generous to American oil firms in Africa, or indeed the world?

  Simon Kareri, the Riggs account executive, who would soon be indicted for his dealings with Equatorial Guinea’s deposits and wire transfers, told Obiang that he suspected the Bush administration had been involved, according to an associate of Kareri’s. The coup attempt explained all the pressure Obiang had faced over his Washington bank accounts, Kareri argued. How else could the events at the bank that winter be explained? The closure of Obiang’s accounts just as the plot was moving toward execution suggested that the Bush administration had created conditions in which the Malabo regime would lose control over Obiang’s $750 million in deposits just as Moto seized power, Kareri speculated. Was it a coincidence that Obiang had been told to move his money and that fungible cashier’s checks were issued just as the coup attempt was being prepared?17

 

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