Son of Angola ex-president in custody

CUSTODY-José Filomeno dos Santos was removed as head of a $5bn wealth fund this yearA son of Angola’s long-serving former president Jose Eduardo dos Santos has been remanded in custody in connection with a $1.5bn (£1.1bn) embezzlement case.

Prosecutors said Jose Filomeno dos Santos had been placed in detention due to the complexity and seriousness of the issue.

He or his legal representatives have not yet commented.

Mr dos Santos was sacked as head of oil-rich Angola’s $5bn dollar sovereign wealth fund after Joao Lourenco became president last year, vowing to eradicate nepotism and corruption.

 

In March, Mr dos Santos was formally accused of fraud over the alleged illegal transfer of $500m from the central bank.

An entrepreneur charged with managing the oil wealth of the struggling African state of Angola was paid more than $41m in just 20 months, leaked documents reveal.

The payments were made via a complex web of companies set up in the offshore jurisdiction of Mauritius.

 

Jean-Claude Bastos also used his position to help set up large investment deals he stands to further profit from, the Paradise Papers show.

All sides deny any wrongdoing.

Like many oil rich countries, Angola set up a sovereign wealth fund to invest the proceeds of its natural resource wealth. Similar schemes have been used by other countries to help ensure a steady income for future generations.

Angola is wracked by corruption, suffers extreme poverty and has one of the highest child mortality rates in the world.

The fund, Fundo Soberano De Angola (FSDEA), which began with $5bn (£3.75bn) in 2011, was mired in controversy from the start, after the then Angolan President Eduardo dos Santos’ son, 39-year-old Jose Filomeno, was appointed to head it up.

Jean-Claude Bastos, sometimes also known as Jean-Claude Bastos de Morais, a Swiss-Angolan and close friend of the then president’s son, was chosen as the fund’s asset manager.

Typically, a fund of this size would spread the risk of investment among several asset managers, along with the fees it pays, said one expert.

 

However, Mr Bastos was given responsibility for investing almost all of the fund’s money, and was paid accordingly. Today, his company Quantum Global Investments Africa Management manages about 85 per cent of it.

One expert described the situation as “unusual”. Andrew Bauer, an authority on sovereign wealth funds, told the BBC: “Funds want to hedge the risk. You don’t want to put all your eggs in one basket.” -BBC

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