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Companies blacklisted in US for allegedly backing Mugabe operate freely in UK

Times Online
The Times
December 22, 2008

John Bredenkamp

Businessmen who have been accused by the US Treasury of financially supporting the Mugabe regime are operating freely in Britain, in spite of Gordon Brown’s declaration that “enough is enough” in Zimbabwe.

Of 21 companies put on a US blacklist by President Bush last month, 14 are based in Britain, two in the Isle of Man, one in Jersey and one in the British Virgin Islands. The other three are based in the Democratic Republic of Congo, Florida and Zimbabwe itself.

Top of the list of alleged Mugabe cronies now under sanction by the US Treasury is the British-based businessman John Bredenkamp.

Mr Mugabe and his henchmen use a number of ploys to stay in power and live in luxury as their countrymen suffer. In this they are said to receive the help of white businessmen, several with British passports, and a number of London-based companies. The foreign currency that these men bring into the country allows top Zanu (PF) figures to buy hard currency at the official rate – way below the currency’s true worth – and earn small fortunes.

“They basically buy real money with worthless Zimbabwean dollars. That way they can buy a car for what an ordinary person would use to fill a tank with petrol,” an insider said.

The operations of some British or British-owned companies have also caused concern. It was reported this year that Foreign Office officials were worried that the Zimbabwean subsidiary of the London-based Standard Chartered Bank was violating European Union sanctions. According to inside sources, the Foreign Office asked the Treasury to make “discreet inquiries” as to whether Standard Chartered loans to the Zimbabwean Government breached the sanctions.

Standard Chartered Zimbabwe is a subsidiary of Standard Chartered Plc of Britain. A Foreign Office official was quoted as saying: “I’m still nervous about the position of other [British-owned] banks [in Zimbabwe], and in particular Standard Chartered.”

Britain has failed to take action against individuals and companies while calling for Mr Mugabe to go. By contrast, the US Treasury last month named four financier “cronies” – Mr Bredenkamp, Muller Conrad “Billy” Rautenbach, Nalinee Joy Taveesin and Mahmood Awang Kechik – of Mr Mugabe and put them on a blacklist, freezing their US assets and banning American citizens from doing business with them.

The list, issued by America’s Office of Foreign Assets Control (OFAC), was rounded off by the 21, mainly British-based, businesses.

“The financial and logistical support they have provided to the regime has enabled Robert Mugabe to pursue policies that seriously undermine democratic processes and institutions in Zimbabwe,” the US Treasury said.

Mr Bredenkamp has been granted indefinite leave to remain in Britain, and operates some of his businesses from an office in Berkshire.

Mr Bredenkamp, 68, was born in Zimbabwe, then known as Rhodesia, and is one of the coterie of “Rhodies”, or white Rhodesians with British connections, whose influence has grown under Mr Mugabe. The US Treasury calls him “a well-known Mugabe insider involved in various business activities, including tobacco trading, grey-market arms trading and trafficking, equity investments, oil distribution, tourism, sports management, and diamond extraction”.

Mr Bredenkamp’s spokesman issued a point-by-point denial, saying: “Breco [a company he controls] does not trade in tobacco. At ‘free’ auctions, it purchases tobacco from the producers and adds value through cigarette manufacturing. Mr Bredenkamp is a passive investor in ACS, an accredited agent to major Western defence and aerospace companies who are regulated by their own governments. ACS does not operate, therefore, in the grey market.

“Alongside the likes of Shell and BP, who have major networks of petrol retail outlets in Zimbabwe, Breco supplies petroleum products, purchased from the State Oil Company by law, to a mere five retail outlets. It also has a small bulk fuel distribution business whose clients include Unicef.

“Mr Bredenkamp has never been involved in the exploration or extraction of diamonds.”

In 1993 Mr Bredenkamp made an estimated $100 million selling his Casalee tobacco company, and set up Breco, a private equity group now on the US blacklist. His spokesman said: “Mr Bredenkamp recently received notification from the US Treasury that he was on the OFAC list. He wishes to make it clear that he is challenging that decision on the grounds that it is based on erroneous information.”

Mr Bredenkamp strongly disputes any suggestion he gives the regime funds to help Mr Mugabe to cling to power. His spokesman said: “Just because he is a Zimbabwean and is based in Zimbabwe and has a business in Zimbabwe does not mean he provides the Zanu (PF) regime with funds. He employs around 1,500 people in his businesses in Zimbabwe – their remuneration supports approximately 6,000 people. Is he meant to quit and put all these people out of work?”

The former England spin bowler Phil Edmonds is chairman of the Central African Mining and Exploration Company (CAMEC), of which the blacklisted Mr Rautenbach is a shareholder. CAMEC announced its acquisition of an interest in platinum assets in Zimbabwe in April. As a result, CAMEC inherited an agreement between Lefever, the company it acquired, to lend $100 million to the Zimbabwean Government as an advance against future dividends.

“CAMEC is conscious of its responsibility to protect the welfare of its employees in Zimbawe,” the company told The Times, “and has invested considerable sums in housing, education and medical projects, not to mention long-term employment opportunities.” It said it had delayed bringing its platinum project into production “until the political situation is stabilised and the platinum price recovers”.

The banks Barclays and Standard Chartered, listed on the London Stock Exchange, have faced criticism over their subsidiaries operating bank accounts for Mr Mugabe’s close aides. To do so is not illegal, but critics question the morality of it.

Standard Chartered said: “We have a long-term commitment to the welfare of our 860 staff, their extended families who depend on them and for our many thousands of customers who rely on our services. Standard Chartered Group makes no money in Zimbabwe. We comply with all US, UK and EU sanctions. We have been consistently clear on the morality of keeping our operation open. It’s quite clearly morally the right thing to do.”

Barclays said: “Barclays Bank Zimbabwe is not opening branches and, in fact, Barclays is not making any new investment in Zimbabwe. Revenue generated in the country is used only to maintain day-to-day operations, pay staff and keep the bank running … Barclays is fully compliant with EU sanctions relating to Zimbabwe.”

Neither Standard Chartered nor Barclays have been blacklisted by the US Treasury.

A fortnight ago Mr Brown launched his toughest attack on Zimbabwe. “We must stand together to defend human rights and democracy, to say firmly to Mugabe that enough is enough,” he said. However, Britain’s sanctions regime against Zimbabwe is much narrower in scope than America’s. It consists largely of Zimbabwean politicians and public figures, none with any serious stake in the British economy.

Asked what action Britain would take against Mr Bredenkamp, a spokesman for HM Treasury told The Times: “We are considering a range of measures with EU partners in response to the continuing impasse in Zimbabwe, including further targeted measures. Announcing these prematurely would be ineffective.”

Additional reporting: Jan Raath

On the US blacklist

John Bredenkamp “A close ally of Mugabe’s”, according to the US Treasury. It lists the following entities, owned or controlled by him: Alpha International (Private) Ltd; Breco (Asia Pacific) Ltd, also Breco (Eastern Europe) Ltd, (SA) Ltd, (UK) Ltd, Breco Group, Breco International, Breco Nominees Ltd, Breco Services Ltd; Corybantes Ltd; Echo Delta Holdings Ltd; Kababankola Mining Company; Masters Int Ltd; Masters Int Inc; Piedmont (UK) Ltd; Raceview Enterprises; Scottlee Holdings (Pvt) Ltd; Scottlee Resorts; Timpani Ltd; and Tremalt Ltd

Muller Conrad Rautenbach (aka Billy Rautenback) Zimbabwean businessman “with close ties to the regime”. Supported Zanu (PF) individuals during the conflict with the Democratic Republic of Congo and “provided logistical support” for mining projects that “benefit a small number of corrupt senior officials”. One entity designated is owned by him — Ridgepoint Overseas Developments Ltd

Nalinee Taveesin A Thai businesswoman who has organised “a number of financial, real-estate and gem-related transactions” for Grace Mugabe and others on the US blacklist

Mahmood Awang Kechik A Malaysian urologist. Alleged to have used his clinic to hide the destination of medical equipment coming into the country. Also implicated in schemes to “generate wealth for these regime officials” and the Zimbabwe Government”

Source: US Treasury Department

TIMES ARTICLE

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