Reykjavík Grapevine - 06.12.2019, Blaðsíða 10

In mid-November, Wikileaks dropped
a bombshell of a story: the Fishrot
Files, over 30,000 documents detailing
how Samherji, Iceland’s largest fishing
company, bribed Namibian officials to
gain access to a massive fishing quota,
and then subsequently squirreled
away the proceeds into a bank account
owned by a shell company in the tax
haven of the Marshall Islands.
This story—widely reported by
Stundin, Kveikur, Al-Jazeera and The
Namibian—catalysed responses in
both countries, but the differences
between how Iceland and Namibia
have responded so far say a lot about
the countries.
So what exactly happened?
The story was brought to light thanks
in large part to whistleblower Jóhannes
Stefánsson, the former manag-
ing director and CEO of Samherji in
Namibia who left the
company in 2016. By
his account, he was the
frontman for the paying
of bribes, but eventually
became wracked with
guilt about “robbing the
Namibian people” and
how Samherji does not
hesitate “to use bribes
and break the law so that
they can take as much
money as they can out
of the country and leave
nothing behind but
burnt soil and money in
the pockets of a corrupt
political elite.”
Strong words, but we
should have in mind that
Samherji’s other dubi-
ous practices have been
a matter of public record
for years now: journalist Ingi Freyr
Vilhjálmsson was reporting in 2012
that Samherji was plundering African
fishing stocks—mostly off the coasts
of Morocco, Western Sahara, Mauri-
tania and Namibia—snatching up
quotas that African companies could
have used, and taking all the profits
out of the local economies.
What makes the Fishrot Files
revelations special is that we now
have evidence that Samherji secured
their Namibian quotas not by outbid-
ding African fishing companies but
through directly bribing the Namibian
politicians responsible for awarding
quotas.
Money in, money out
The Fishrot documents show that
Samherji paid some $10 million USD
in bribes to several Namibian officials,
including (now former) Minister of Fish-
ing Bernhardt Esau, (now former) Justice
Minister and former attorney general
Sacky Shanghala, and James Hatuikulipi,
an investor and the (now former) chair of
Fishcor, Namibia’s state-owned company
which distributes fishing quotas. These
bribes were, of course, not listed as
“bribes” in Samherji’s accounts, but rather
“consultation fees” and “facilitation fees.”
The payments were often very
complex. For example, Samherji paid
$3.5 million USD to a company known
as Tundavala Investments Limited in
Dubai—which happens to be owned by
James. The payments originated from
Esja Seafood Limited, a Samherji hold-
ing company in Cyprus.
Once the cash from these quotas
came in, Samherji did their best to
ensure that they could hang onto
as much of it as possible. Many of
these proceeds were funnelled to the
Marshall Islands, a tax haven, and
put in a bank account there of a shell
company called Cape Cod FS. While
Norwegian financial services company
DNB NOR (now DNB) ended up closing
that account because they could find
no information on the actual benefi-
cial owner of Cape Cod FS, Samherji
had been using that account for about
seven and a half years prior, and contin-
ued to be a major client of DNB NOR.
The Namibian response
There has been a stark contrast
between how Namibian and Icelan-
dic authorities have responded to the
news. Within hours of the story break-
ing, Namibian President Hage Gein-
gob announced that he would fire both
Bernhardt and Sacky. Shortly there-
after, they both resigned. James also
vacated his post, and, at the time of
writing, all three have warrants issued
for their arrest. In fact, six arrests in
all have been made at the time of this
writing.
It is important to note that it is
an election year in Namibia—ballots
were cast on November 27th—which
may have inspired President Geingob’s
swift response. The Namibian people
took to the streets the same day the
news broke, demanding the presi-
dent’s resignation.
Further, the editorial staff of The
Namibian issued a statement of their
own, arguing that “no amount of
firing of ministers and convicting top
officials will fix the looting of state
resources, unless loopholes in the
system are closed… It is systemic, and
the looters are getting more and more
sophisticated to enrich themselves at
the expense of many ordinary Namib-
ians.” This paper has also been contin-
uously reporting on how Samherji
and other colonisers have effectively
been taking food out of the mouths of
Namibians.
This swift and unequivocal response
stands in stark contrast to Iceland’s
response; it also underscores the
reprehensible blame-shifting some
Icelandic politicians have engaged in.
The Icelandic response
In Iceland, the Fishrot Files have
underscored just how great an ideo-
logical gap there is between the
government and the general populace.
A demonstration held on November
23rd in front of Parliament, attracting
some 4,000 people, illustrates well the
grievances that many Icelanders have
with the situation, as a major theme
of the demonstration demanded the
resignation of Minister of Fisheries
Kristján "ór Júlíusson.
Kristján used to be on Samherji’s
board, and is life-long friends with
Samherji CEO "orsteinn Már Bald-
vinsson, who has temporarily stepped
aside as investigations into his
company continue. The fishing minis-
ter is also responsible for awarding
quotas. In the eyes of many, includ-
ing key members of the parliamentary
opposition, this puts him too close to
the case to be effective in his position.
Not that it matters to Kristján—he
told reporters that he was completely
unmoved by the demonstration and
sees no reason to vacate his post.
And there’s little reason for him to
feel otherwise, considering that even
Prime Minister Katrín Jakobsdóttir
has defended him and asked his critics
to back off.
“Forced” to bribe
While opposition MPs have diligently
criticised the response, bear in mind
that "orsteinn Már is still very much a
free man. Even as tax authorities and
at least two banks are pouring over
Samherji’s records, "orsteinn and his
friends have secured platforms on vari-
ous media outlets to wax poetic about
how unfair this whole thing is, and
have paid visits to Samherji fish factory
workers to characterise the inves-
tigations as an attack on all of them.
Meanwhile, "orsteinn Már’s pals
in the Independence Party have gone
on the defensive in a major way, blam-
ing Namibia for Samherji’s malfea-
sance. The crowning example of this is
Minister of Finance Bjarni Benedikts-
son telling television station Stö# 2:
“Corruption in these countries, that’s
perhaps the root of the problem in this
particular case. A weak government, a
corrupt government in this country.
That seems to be the underlying prob-
lem that we’re seeing crop up now.”
This statement made world news,
and for good reason. It is not just
a spectacular example of blame-
shifting; it also reflects a colonial
mentality about African countries,
painting them as so woefully corrupt
that honest European business-
men simply have no choice but to
pay bribes to African officials. It also
ignores the fact that Icelandic fishing
company CEOs ingratiate themselves
to Icelandic politicians, donating to
their campaigns—those same poli-
ticians have been lowering taxes on
these companies, for some reason.
So what now?
While Icelandic tax authorities are
combing through Samherji documen-
tation, both Arion Bank and Íslands-
banki are reportedly investigating the
fishing giant’s activities. Tina Søreide,
one of Norway’s leading experts
on corruption, also told reporters
that the FBI and the Securities and
Exchange Commission could possibly
get involved, on account of how Bank
of New York Mellon stopped a fund
transfer from one of Samherji’s shell
companies. The FBI, for the record,
will neither confirm nor deny whether
they are interested in the case.
Words:
Andie Fontaine
Photo:
Wikileaks
10 The Reykjavík Grapevine
Issue 21— 2019News
"The swift and
unequivocal
response in
Namibia stands
in stark contrast
to Iceland’s
response and
underscores
the blame-
shifting Icelandic
politicians have
engaged in."
The Fishrot Files:
A Tale Of Two Countries
Iceland and Namibia and comparisons in corruption
Why be a badboy when you can be a bad man? Bernhardt Esau (le&) and 'orsteinn Már Baldvinsson
Meanwhile, in Norway
Remember when we mentioned DNB? Well, they
haven’t escaped the Fishrot Files unscathed.
As reported, Samherji was a major client of
DNB, which helped in the transfer of around
$70 million USD into shell companies in tax
havens. That much is a matter of public record.
What is less clear is how culpable they are,
and management at the bank has been very
vocal about getting to the bottom of this—
especially since the Norwegian government
owns a 34% stake in the bank.
Timing plays a crucial role in this.
DNB’s former CEO, Rune Bjerke, retired last
September, and the new CEO is now Kjerstin
Braathen. She is now in the di'cult position
of managing the fallout of DNB activities that
preceded her post.
In this respect, she seems to be handling
herself well. Speaking to the newspaper
Dagens Næringsliv, Kjerstin said in no
uncertain terms that DNB was taking the
case seriously “and we can’t rule out that we
have been misused,” emphasising that a full
investigation is necessary.
Norway’s Minister of Finance, Siv Jensen,
completely agrees, urging DNB to “lay all
its cards on the table,” adding, “DNB must
contribute so we can get to the bottom of this,
I think that’s in DNB’s own interests.”
Nonetheless, Kjerstin has been just as
adamant about DNB’s innocence as Icelandic
businessmen have been about theirs.
“Sometimes you can get the impression that
it’s DNB that’s accused of criminal operations,”
she told Dagens Næringsliv. “I want to stress
that these are complaints tied to a fishing
firm in Iceland. It’s not nice when customers of
DNB are alleged to be involved in crime. What
we can do is bring forth information that can
enlighten the situation.”