Banker Turned Guinea Minister Says Money Was Loan, Not Bribeby
U.S. claims $8.5 Million was a bribe to fund lavish lifestyle
Mahmoud Thiam on trial in New York on money-laundering charges
A Guinea-born former Wall Street banker denied betraying his homeland’s natural wealth for $8.5 million in bribes, telling a New York jury the money was a loan he took to address a "desperate situation" in his personal and business affairs.
Mahmoud Thiam served as the West African nation’s mining minister from 2009 to 2010 after spending 14 years as an international investment banker at Merrill Lynch & Co. and UBS Group AG in New York. He said the money was a loan from Hong Kong executive Sam Pa, which he used to pay business debts and feed his family back in the U.S. while he worked abroad.
Prosecutors claim it was a bribe to help Pa’s company, China International Fund Ltd., win a $7 billion development deal with Guinea, one of the poorest countries in the world. They claim he spent the money on luxury hotels, jewelry, ski lessons, private school for his kids, a Steinway grand piano and a 30-acre estate in New York’s Dutchess County,
"This is not money used to feed a family," Assistant U.S. Attorney Christopher Dimase said in his closing argument to jurors in Thiam’s money-laundering trial in New York Tuesday. "This is money that’s being used for luxury goods, to feed a very lavish lifestyle."
China International had sought the exclusive rights to exploit Guinea’s rich deposits of iron, gold, diamonds and bauxite.
Under questioning by Assistant U.S. Attorney Elisha Kobre, Thiam said he didn’t make any payments on the loan and reported it to the U.S. as taxable income from consulting, rather than as a debt. He said he was aware of rumors that Pa had bribed Moussa Dadis Camara, the Guinean army officer who headed Guinea’s ruling military junta, and had seen Pa hand a cash-filled suitcase to a government employee.
Thiam is charged with laundering the money through foreign accounts and wire transfers into the U.S. If convicted, he could be sentenced to as long as 10 years in prison. A jury is set to begin deliberations on Wednesday.
Thiam’s lawyer, Aaron Goldsmith, told jurors that prosecutors failed to produce any evidence to show the money was an illegal payment, which is necessary for jurors to find Thiam guilty of money laundering.
"They didn’t have anything to show it was a bribe," Goldsmith said.
Goldsmith told jurors his client is innocent. Thiam was trying to help Guinea exploit its minerals to gain badly needed resources for its people, he said.
Thiam, who testified for about four hours on Monday and Tuesday, said he used foreign bank accounts and lied to U.S. bank officials in order to get around international sanctions that had been imposed on Guinea’s ruling regime. He said he feared U.S. banks would consider him a politically exposed person -- a prominent foreign office-holder viewed as presenting a heightened risk of corruption -- and refuse to let him set up accounts.
Guinea is home to what once was one of the world’s most prized mineral assets -- the $20 billion Simandou iron ore project -- which attracted companies including Rio Tinto Group and Beny Steinmetz’s BSG Resources Ltd. Fights over the control of the site spurred lawsuits and allegations of bribery. Rio fired the head of its energy and minerals unit in November over a $10.5 million payment to a consultant for helping with negotiations over Simandou.
China International Fund didn’t respond to emails seeking comment on the bribery allegations.
The case is U.S. v. Thiam, 16-mj-07960, U.S. District Court, Southern District of New York (Manhattan).