Russian citizen Isabelle dos Santos became Africa's richest woman thanks to her father’s ties

The richest woman in Africa and a citizen of Russia, Isabelle dos Santos, created a business empire with the help of hundreds of shell companies, protectionist deals and ties of her father, the former president of the country.
Origin source
Isabelle dos Santos is the daughter of the former president of Angola and, as it turned out recently, a Russian citizen, her husband and persons acting in their interests have created in dozens of jurisdictions, including offshore and “tax havens”, a business empire of more than 400 companies that have received from Angola’s government contracts for billions of dollars, according to an investigation by the International Consortium of Investigative Journalists (ICIJ). Journalists claim that it was precisely the fraudulent transactions that took place over the course of 20 years that made soul Santos the richest woman in Africa, and Angola, rich in oil and diamonds, one of the poorest countries in the world.

A new ICIJ investigation is called Luanda Leaks. It lasted eight months, during which more than 120 journalists studied hundreds of thousands of documents received as a result of the leak and interviewed dozens of people. Leaked documents include emails and documents from dos Santos companies, consultants' reports, tax returns, etc.

The results of the investigation were published immediately in several major international publications, including The New York Times, The Guardian. Forbes talks about the main findings of these publications.

The Appearance of a Billionaire

ICIJ calls her husband Sindica Dokolo the key business partner of dos Santos. They got married in 2002 when she was 29 and he was 30. Dokolo is a wealthy Congolese businessman and art collector "addicted to Porsche cars, American basketball, and African art." In a wedding article in the weekly Jeune Afrique, Dokolo stated: "The next oligarchs - like the ones we see in Russia - will come from our region."

It follows from the investigation that over the past decades (journalists have been studying the period since 1992), dos Santos and her husband have registered more than 400 entities in 41 countries. Some companies were created in tax havens, such as Malta and Hong Kong. According to the ICIJ, the Santos team used these jurisdictions to preserve its condition. The favorite from jurisdictions was Malta: among the leaked documents, journalists found a 16-page description of Malta tax benefits prepared by lawyers, which indicated that by creating a company in this country, you can start a business and receive dividends, interest and royalties without paying taxes.

At least 94 companies have been registered in jurisdictions guaranteeing financial secrecy, such as Dubai, Mauritius and the British Virgin Islands. A third of these companies were shell companies, according to ICIJ. According to the investigation, dos Santos and her husband used this “shell company archipelago” to invest in business and real estate without too much attention.

For example, in 2010, Dokolo used two Maltese companies to acquire a majority stake in Swiss jewelry company De Grisogono. His business partner in this transaction was the Angolan state-owned diamond trading company Sodiam. Sodiam helped finance the deal and lent the jewelry company more than $ 120 million, according to the documents.

Santos and her husband used another Maltese company to buy an apartment in Monte Carlo for $ 55 million, ICIJ said. In 2016, dos Santos and Dokolo purchased a yacht for $ 35 million through a shell company registered in the British Virgin Islands.

In interviews and public appearances, Santos poses as a self-made billionaire. For example, in an interview with the Financial Times, she said that her entrepreneurial spirit woke up as a child when she sold eggs to buy cotton candy. In turn, ICIJ calls her "the main beneficiary" of her father's activity - Jose Eduardo dos dos Santos, who steadily ruled Angola for 38 years. Dos Santos treated Angola “as his personal farm,” local human rights activist Salvador Freire told reporters.

The marriage of parents Isabelle dos Santos fell apart when she was a child. In 1979, the six-year-old shower Santos with his mother, a native of Penza Tatyana Kukanova, left Angola for London, where she graduated from high school and received an engineering education. Nevertheless, she remained close with her father - as noted in the investigation, at family meetings they sometimes took out guitars and improvised together.
In 1999, the father of dos Santos created Angola Selling Corp., which received the exclusive right to sell Angolan diamonds. He transferred a 24.5% stake to Gibraltar-registered company Trans Africa Investment Services. Later it turns out that the only owners of this company were Isabelle dos Santos and her mother, writes ICIJ.

A year later, the Angolan government issued one of the country's first Unitel mobile licenses, among the owners and founders of which was Isabelle dos Santos.

By the age of 30, Santos owned millions of dollars worth of luxury apartments in London and Lisbon, writes ICIJ.

Thanks to her father’s connections, Santos met the Portuguese billionaire Americo Amorim (died in 2017), who became her business partner. In 2005, they jointly created Banco BIC in Angola - now it is one of the largest banks in the country with assets of $ 4.2 billion. Subsequently, business partners jointly invested in cement production, real estate and energy.

In 2005, Amorim and the Angolan state-owned oil company Sonangol established a joint company, Amorim Energia, which subsequently acquired 33.3% of the Portuguese energy company Galp Energia. A year later, Sonangol sold 40% of its interest in the joint venture of the Swiss company husband dos Santos Exem Holding. The stake was valued at $ 99 million, but Sonangol received only $ 15 million, agreeing to lend the buyer most of the amount. Dokolo told ICIJ that it had fully repaid the loan in 2017. In turn, Sonangol stated that it had declined the payment, since in violation of the loan agreement, the payment was proposed to be made in Angolan currency. Today, the value of the stake sold is estimated at approximately $ 800 million, the investigation said.

By the age of 40, Santos had become “the main economic force in Angola”: thousands of people worked for it. Its assets included stakes in Unitel mobile operator, Banco BIC and Banco BPI, Portugal's largest cable and Internet operator ZON Multimédia and satellite operator ZAP, the Portuguese manufacturer of electrical components Efacec Power Solutions, a jewelry company de Grisogono. Dos Santos also controlled Nova Cimangola, the largest cement producer in Angola, and was preparing to launch the Candando supermarket chain and the Sodiba beverage producer.

That year, dos Santos first entered the Forbes ranking, being the only woman among African billionaires. At the same time, an article on souls Santos indicated that her condition was mainly formed due to protectionism.

Cash machine for shower Santos

Companies paid dos Santos millions of dollars in dividends, writes ICIJ. In particular, journalists call Unitel “the money machine”: according to journalists, from 2006 to 2015, the telecom operator could pay shareholders more than $ 5 billion in dividends.

Dos Santos also conceived a major renovation project for the Angolan capital of Luanda, due to which, according to ICIJ, thousands of families lost their homes. She planned to build up the coastline with tall houses, create artificial islands and equip a new beach, port and promenade. And she claimed that it would not be necessary to evict or resettle the inhabitants of the coast - everything would be built on lands “reclaimed” from the sea. The $ 1.3 billion project was tentatively approved by her father in May 2013. The very next month, soldiers, police and presidential security officers began to evict residents of the fishing village of Arey Branka and demolish their homes with bulldozers, writes ICIJ. “Without warning, without notice ... It was like a massacre,” a local resident told reporters.

Bank shares needed dos Santos to finance the activities of their business empire, when it was difficult to attract financing from Western banks. According to ICIJ, since 2012, Western banks have become concerned about dubious operations of companies such as Santos and her husband - for example, the $ 460 million loan that Unitel issued to her Dutch company Unitel International Holdings and the payment of $ 1.3 million to offshore Dokolo in the British Virgin Islands by the Swiss jewelry company de Grisogono. Banks, in particular Citigroup and Barclays, began to refuse transactions, considering the risks too high. Problems also arose with Deutsche Bank, ING and Santander.

To improve her image of souls, Santos hired the most famous public relations consultant in Portugal, began giving interviews and participating in major business events, and started Instagram, where she posted selfies from economic forums, family photos and photos with celebrities like Paris Hilton, Chris Jenner, Nicki Minaj and Lindsay Lohan.

Against this backdrop, one of Unitel’s shareholders, PT Ventures, filed a complaint with the International Chamber of Commerce in Paris, claiming that Unitel issued loans to hundreds of millions of offshore firms under the scheme “looting the company in favor of Isabelle dos Santos.” The company estimated the loss of Unitel at $ 314 million. Dos Santos rejected the allegations, noting that all decisions were made in the "interests of Unitel." At the same time, ICIJ writes that, according to the documents studied, Dos Santos signed controversial loans both as a borrower and as a lender.

In 2014, after the collapse of oil prices, Sonangol faced financial difficulties. Boston Consulting Group, attracted by advisers dos Santos, has prepared a 52-page rescue plan for the state-owned company. The leading role was played by the Maltese company Wise Intelligence Solutions, whose sole shareholders were shower Santos and her husband, writes ICIJ. Soon, the Angolan government signed a $ 9.3 million contract with this company to provide consulting services to Sonangol.

In 2015, according to ICIJ, the father of dos Santos began to prepare for his resignation from the post of president, who by that time had held 35 years. His administration has concluded a number of contracts that benefit Isabel dos Santos companies, ICIJ claims with reference to the documents examined. In particular, the master plan for the renovation of Luanda and the project for creating a new port north of the capital were finally approved. The company dos Santos Urbinveste received contracts for $ 1.3 billion and $ 1.5 billion, respectively. Subsequently, the new president of Angola canceled both projects. In addition, the company dos Santos received a contract for the construction of a dam and hydroelectric power station worth $ 4.5 billion.

In 2016, the father of dos Santos appointed her head of the state oil company Sonangol. In this company, then still new and fast-growing, Dos Santos was in her childhood - before leaving for London, her mother worked there, who sometimes took her daughter to the office. One of the company's former managers recalls seeing little Isabelle on her mother’s lap at her desk. Heading the company, dos Santos became the second most influential person in the country after the president, said Angolan analyst Aslak Orre.

Soon after the appointment of Santos douche, her lawyers created Ironsea Consulting in Dubai (later renamed Matter Business Solutions DMCC). The company’s office was registered in the neighborhood of the Santos dos Jumeirah residence, and the owner of the documents was her longtime girlfriend and business partner Paula Oliveira, writes ICIJ. Sonangol has a consulting service contract with this company.

$ 1 billion overpayment

In the fall of 2017, the father of souls Santos ceased to be president. Replacing him, Juan Lawrence fired Santos shower from his post as head of Sonangol. A few hours later, Sonangol asked its Portuguese bankers to transfer $ 38 million to the bank account of Matter Business Solutions, writes ICIJ with reference to the studied leaked documents Sonangol. In just two days, according to journalists, the oil company transferred $ 58 million to Mattter Business Solutions with three payments.

Three months later, the new head of Sonangol, Carlos Saturnino, said that dos Santos, for 18 months at the state-owned company, had approved the payment of nearly $ 135 million for consulting services. Most of this money, he said, went to her companies, including Dubai's Matter Business Solutions, the rest to her trusted advisors, including giants such as PwC, Boston Consulting and McKinsey. Dos Santos herself said that all these payments were legal and were made for the services provided. She also noted that the contract with Matter Business Solutions was approved by the Board of Directors of Sonangol, while she abstained from voting to avoid a conflict of interest.

In March 2018, the Angolan prosecutor's office launched a preliminary investigation into the case. Dos Santos was called for interrogation, but did not appear, later stating that she had not received a summons.

Unnamed Angolan officials told ICIJ that, according to preliminary data, government contracts concluded by the government of dos Santos with their daughter’s companies were overstated by more than $ 1 billion. An investigation is underway. Dos Santos, her husband, and Mario Filipe Moreira Leyte da Silva, a former PwC employee who managed the spouses ’finances, are on trial. In late December, an Angolan court seized the assets of Santos souls. Forbes estimates the value of the blocked property at $ 400 million

PwC declined to comment on the services that dos Santos provided to the companies, and announced its intention to break the partnership. McKinsey said it no longer collaborates with Santos shower structures. Boston Consulting said it had taken measures to conclude the contract in order to “enforce established policies and avoid corruption and other risks.”