Chance encounters
Money laundering, Issue 1483 AS security minister Ben Wallace admitted last week to a parliamentary inquiry into financial crime networks, British law firms “are too often woven into their web”. What he didn’t say was that lawyers’ involvement in questionable deals goes far beyond the back street operators to the top of the profession.

Private Eye has uncovered a raft of work taken on by the country’s largest law firms for some of the world’s most dubious individuals, even after tougher money regulations were introduced in 2007. Leading “magic circle” firm Clifford Chance has kept some particularly mucky company, according to correspondence contained in the Paradise Papers, leaked to Süddeutsche Zeitung and shared by the International Consortium of Investigative Journalists.

In 2012, Isabel dos Santos, daughter of Angolan dictator (from 1979 until last year) José Eduardo dos Santos and coincidentally Africa’s first female billionaire, had some pressing business for which she needed the services of offshore law firm Appleby (from which the Paradise Papers were leaked).

‘Urgent deal’
“Please note that one of our potential clients wants to acquire a shelf [company] in Mauritius or BVI by Wednesday of this week,” wrote one Appleby official to another. The company “would be owned by Isabel José dos Santos who is the eldest daughter of the Angolan president José Eduardo dos Santos”. The company was needed quickly “because of an urgent deal” said to be connected with the Unitel mobile phone group, owned partly by the state and partly by Isabel’s phone company, Vidatel. The approach to Appleby had been made by Clifford Chance, though not its local Luanda office. “The instructing party is Clifford Chance of London,” noted Appleby.

The “shelf” company Clifford Chance wanted refers to an existing company that saves time on incorporating a new one. Alas for Isabel, even Appleby wanted none of this business. A later board meeting of Appleby Corporate Services in Tortola, British Virgin Islands, discussed a “Declined Business Register”. In it the company recorded that Appleby didn’t do shelf companies and, furthermore, “searches indicate both Isabel and Jose are PEPS [politically exposed persons, presenting higher money laundering risk]. Other internet searches revealed adverse findings for both Isabel Jose dos Santos and Jose Eduardo dos Santos”.

‘Grand corruption’
By 2012, adverse findings about the dos Santos family and Luanda regime were not hard to come by. The International Monetary Fund had repeatedly reported billions of dollars going missing from state funds. Much disappeared through Sonangol and other state-owned enterprises into the hands of the “Futango”, a network of high-ranking members of the ruling MPLV party and their families. As Transparency International wrote about the country in February 2011: “Corruption manifests itself through various forms, including bureaucratic, political and grand corruption, embezzlement of public resources, systematic looting of state assets, and a deeply entrenched patronage system that operates outside state channels.”

The organisation ranked the country 168th out of 182 for propriety that year. Nevertheless, the president’s billionaire daughter was evidently still a suitable Clifford Chance client, even though anti-money laundering regulations required “adequate measures to establish the source of wealth and source of funds” when a client was a so-called “politically exposed person”.

In fact the spoilt kids of Africa’s despots have long provided business for the firm. In 2006 it represented Teodorin Obiang, son of Equitorial Guinea dictator Teodoro, when he bought a $38m private jet; and then again in 2011 when US investigators seized around $70m of his assets, including Michael Jackson memorabilia.

‘Strict obligations as a law firm’
Not much further up the propriety rankings, at 164, was Kyrgyzstan. Clifford Chance happily took on as clients three of its leading oligarchs – Patokh Chodiev, Alexander Maskevich and Alijan Ibragimov – as the billionaires took the mining company they founded, Eurasian Natural Resources Corporation, private in late 2013. A few months earlier ENRC had been formally placed under investigation by the UK’s Serious Fraud Office (where it remains) over allegations of bribery around the world. The company had already settled an investigation in Belgium and been extensively covered by the Eye’s Slicker column over its dubious practices. Again, this didn’t seem to trouble Clifford Chance’s lawyers.

The firm does not dispute having acted in any of these cases, but insists it has acted “ethically and with integrity” and has “robust policies and procedures to ensure that any work we undertake meets our strict obligations as a law firm”.

In 2013, the firm’s outgoing managing partner David Childs revealed the financial imperatives, lamenting in an FT interview that “I would like to have seen profitability rise more quickly [after the financial crisis] than it has done”. He now chairs the conduct committee of the Financial Reporting Council accountancy regulator.

There aren’t many regimes, it seems, that are too unsavoury for Clifford Chance. Earlier this year it lined up the transfer of a majority stake in Saudi broadcasting company MBC to the Riyadh government as part of Crown Prince Mohammed bin Salman’s “Great Sheikh-down”. Just a few weeks earlier, MBC’s chief exec Waleed al-Ibrahim and his brothers had been imprisoned in the Ritz Carlton. There may be no money laundering concerns in this case, but handmaiden to a murderous, corrupt regime is not perhaps the best look for a leading London law firm that hosts regular anti-corruption events for… Transparency International!