A new report exposes the difficulties of the Mubarak asset recovery

In the aftermath of the Arab Spring in 2011, Switzerland froze 700 million Swiss francs belonging to former Egyptian president Mubarak and his entourage, including business mogul Hussein Salem. The move raised huge expectations among the Egyptian population that this money would be quickly seized and returned to their country. But six years later, this high profile asset recovery case has produced almost nothing. In a report released today, Public Eye tells for the first time the story of the failed recovery of Egyptian money in Switzerland and presents the reasons explaining this poor result.

Together with its partner Egyptian Initiative for Personal Rights (EIPR), Public Eye conducted a new analysis on partly unpublished court documents from Egypt and Switzerland relating to the investigations opened following the Arab Spring. In a report based on exclusive documentation (partly downloadable below), Public Eye sets out what happened in 2016, when Switzerland released one quarter of the Egyptian funds that had been frozen in 2011 – about 180 million Swiss francs. The meagre information communicated by the Swiss authorities at the time contrasts with the importance of this decision.

In August 2017, after six years of investigation, Swiss judicial authorities told the Egyptian General Prosecutor that mutual legal assistance had now been closed without any material results. The case shows how difficult it is to prove the illicit origin of Egyptian money still frozen in Switzerland. For the Egyptian population, the size of the amounts is sufficient to demonstrate its illicit origin. However, the path of international legal assistance did not prove it, and the funds could therefore not be seized. In these circumstances, all the efforts employed following the freezing of the Mubarak funds have served only as a sad show of powerlessness, as the confiscation of the money appears now to be increasingly unlikely.

The report “Failed Recovery” is a case study that examines the difficulties that might arise in any asset recovery process when the usual means of collaboration between the judicial authorities fail, a not-uncommon situation in such matters. In particular, it shows the inadequacy of the Swiss law for dealing with money from Politically Exposed Person (PEP), failing to enable assets of dubious origin to be seized when international legal assistance breaks down. The report also describes how Switzerland’s banks, having accepted the dubious Egyptian money in the first place, then take advantages of this failed recovery. No clear signal has been sent to banks and some may interpret this to mean that, in the future, they will be able to accept such funds with limited risk.

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