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Money paid to Egypt was merely 'a donation, not financial settlement': Mubarak-era businessman

Mariam Mecky , Menna Alaa El-Din , Sunday 2 Oct 2016
Hussien Salem
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Egyptian business tycoon Hussein Salem's family argues that his payment of billions of pounds to the government in exchange for the dropping of charges against him is "unlawful," with his daughter referring to the funds as "donations," the family said in an interview with prominent TV host Amr Adib on his show Kol Youm.

Adib interviewed Salem, who appeared in a sickly condition, along with his son Khaled and daughter Magda in Spain in mid-August in their first TV appearance after the conclusion of Salem's deal with the Egyptian government on 3 August. The interview was aired on Saturday. 

The financial settlement was achieved once a fugitive Salem, a former close associate of ousted president Hosni Mubarak, agreed to a deal with the government where charges against him would be dropped in exchange for the business mogul giving up EGP 5.3 billion (approx. $596.5 million).

The 83-year-old, who fled to Spain shortly after Egypt’s 2011 uprising that overthrew long-time president Mubarak, had received two jail terms in absentia over corruption charges including squandering public funds, profiteering and money laundering.

The money paid in the settlement was 10 percent cash and the rest was in assets, Salem said in the interview.

The figure accounts for 75 percent of Salem's assets inside and outside Egypt, according to Adel El-Saied, a justice ministry aide for the Illicit Gains Authority.

Salem's total assets are worth EGP 7.12 billion (approx. $799 million), El-Saied added.

Salem's daughter Magda insisted in the interview that the deal with the government "is not reconciliation, it is a donation."

"My father is not a suspect; he did not commit any crime."

Salem's son Khaled claimed that the family paid EGP 5.4 billion even though the deal required a payment of EGP 4.5.

"After six years of silence, we decided to talk to the media as cases were fabricated against us," Khaled goes on, claiming that the family has been borrowing money to get by over the past six years.

"We want a quick resolution. We want mercy. Why did my father donate? He donated so his sons and grandsons can live in peace," Magda said.

"We only have EGP 147 million, and part of it is indebted," she claimed.

According to the Illicit Gains Authority, Salem's remaining family assets are estimated at EGP 1.82 billion.   

Throughout the interview, the family called on officials to quickly implement the required legal procedures so they can return to Egypt.

The interview took place in mid-August in Madrid before Egypt’s prosecution asked Interpol last Thursday to lift the names of Salem and his family off its Red Notice Wanted list and airport watch lists.

Also in late August, Egypt's prosecutor-general Nabil Sadek sent a request to judicial authorities in Switzerland, Spain and Hong Kong to unfreeze Salem’s assets and funds abroad.

Salem blames Muslim Brotherhood

"The Muslim Brotherhood and Qatar are the ones behind our current situation," said Salem – who could not speak properly due to his medical condition – as interpreted by his children.  

"Qatar wanted to take the gas contract to export natural gas to Israel," Magda said, alleging that Qatar was attempting to undermine Salem as he was a major shareholder in East Mediterranean Gas (EMG), the firm that exported gas to Israel. Salem reportedly contributed $95 million to EMG's paid up capital.

Egypt agreed to provide Israel with natural gas in a 2005 deal.

The public prosecution said following the 25 January Revolution that the agreement caused Egypt losses of over $714 million.

Salem referred to the revolution as a "major plot and conspiracy by the Muslim Brotherhood and Qatar," adding that "God saved [the country] on 30 June," when Islamist President Mohamed Morsi was ousted from power. 

On Mubarak, Salem said that the former president has not been in contact with him, though Salem "prays for him."   

Salem blamed all of Egypt's current troubles on the Brotherhood.

In the spring of 2012, Salem offered the Muslim Brotherhood government half of his fortune in exchange for the dropping of all charges against him, a deal which was never reached.

Another offer was made in January 2014 to the interim government, prior to the election of Egypt's current president Abdel-Fattah El-Sisi.

"We thought they would do us justice after the 30 June uprising, but that did not happen," Salem said.

Salem said that he stands against the Muslim Brotherhood as well as Qatar, Turkey and the US.

Return to Egypt

The family claimed that they have been unfairly targeted for prosecution.

"Did anyone pay money like me? There are many businessmen from Mubarak's era that have not paid anything. They are richer than me. Why the focus on the Salem family?" Salem said.

During the interview, the host Adib called for further financial settlements with imprisoned or fugitive businessmen following the example of Hussein Salem.

"The country needs to get this done in order to move past this era," Adib said, adding that this would make foreign investors feel that "investment and money issues" in the country are easily resolved.

"Similar deals can take place with [former officials] Rashid Mohamed Rashid and Youssef Boutros Ghaly," Adib suggested.

When Salem was asked whether such settlements would encourage other businessmen and investors to move towards the same solution, he answered, "of course."

Article 18 of the criminal law allows the country’s premier to create a reconciliation committee if a defendant or his lawyer requests it.

The Illicit Gains Authority has received 26 requests from other Mubarak-era figures for reconciliation with the government, El-Saied said earlier.

While Salem's family says their father was eager to give back to Egypt, saying that the country was "in need" of the money they "donated," they called on officials to stop being hesitant over concluding legal procedures.

The businessman previously told Adib in a 2012 interview "I do not believe I owe the country a single penny."

The family said they are planning to manage their business ventures upon their return to Egypt, including shares in Sharm El-Sheikh hotels under Magda and Khaled's control.

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