Special Report: How to make millions selling passports to Africa

[December 22, 2017]  By David Lewis and Philippe Engels

MORONI, Comoros Islands/BRUSSELS (Reuters) - In the tiny nation of the Comoros Islands, lying off the east coast of Africa, Albert Karaziwan is a big man - even though he doesn't live there. He's been a roving ambassador for the country, has twice attended the United Nations General Assembly with the Comoros delegation and holds three current Comoros diplomatic passports.

But Karaziwan is not a politician or a professional diplomat or a native of the Comoros. He's an international businessman, born in Syria and a citizen of Belgium, whose company Semlex Group has supplied and made passports or other ID documents for the Comoros and over a dozen other African nations.

A Reuters examination of Semlex emails, corporate records and signed contracts found that Karaziwan has won business in the Comoros and elsewhere in Africa - on paper worth hundreds of millions of dollars - through political connections, sometimes without going through open tender processes and sometimes while making payments to intermediaries.

At the same time, presidential decrees and other documents from the Comoros shed new light on how Comoros passports, supplied by Semlex, are being bought by foreign citizens, some of whom are suspected by Comoros and foreign authorities of being security threats. Reuters determined that at least two buyers of Comoros passports are people accused by U.S. authorities of breaking sanctions against Iran.

Karaziwan's political links are remarkable. In the Comoros, where Semlex first won a contract to supply passports and other documents in 2007, he was made a special adviser and roving ambassador by former president Ahmed Abdallah Mohammed Sambi. At least eight of his staff and associates acquired Comoros honorary consulships, according to Comoros government documents reviewed by Reuters. The honorary consulships, nominated between 2010 and 2012, ranged from Mombasa to Monaco.

On receiving questions from Reuters, Sambi indicated he would answer but did not respond by the time of publication.

Karaziwan is listed on a Comoros government database as having three current Comoros passports. The database shows his Belgian wife, Catherine Laurent, was issued with a Comoros diplomatic passport in 2010, and that their 27-year-old son, Alexandre, who works for an IT consultancy in Brussels, also has one. Some Semlex staff were also issued with them.

Reuters was unable to determine why the Comoros granted these credentials or why the Karaziwans and Semlex associates may have sought them. In general, according to law enforcement officials, such passports and consular nominations facilitate travel, open doors and, in some cases, make doing business easier.

Karaziwan did not respond to a request for an interview or to questions sent to him by email. A Brussels-based lawyer representing Semlex, Francois Koning, said Karaziwan would not comment for this article, claiming that unidentified third parties were manipulating Reuters with the aim of damaging Karaziwan and Semlex.

Laurent said she had no role at Semlex and did not know whether she had a Comoros diplomatic passport. "It is possible, but I don't use one, so I am not sure," she said. Alexandre Karaziwan did not respond to several requests for comment sent to him via his LinkedIn account.

Albert Karaziwan's activities have come at a cost for many ordinary citizens of Africa, the world's poorest continent, Reuters inquiries show.

In April, Reuters reported how Karaziwan struck a deal to supply biometric passports to the Democratic Republic of Congo for which its citizens have to pay $185 each. Congo previously charged $100 for passports. The current deal arranged for $60 from each passport to go to an obscure Gulf company owned by a close relative of Congo's President Joseph Kabila, according to documents and a source familiar with the arrangements.

This year, Mozambique terminated a 10-year Semlex contract, potentially worth several hundred million dollars, that had been awarded in 2009 by the country's previous government. The deal was struck without an open tender, two sources close to Semlex said. The current Mozambique government says Semlex invested a fraction of the $100 million it had promised to spend on training, electronic scanners at borders and other infrastructure. It says citizens have lost out from the deal.

When the passports were introduced, they cost Mozambique citizens $80 while the average income per capita was under $500 per year, though currency changes meant the cost later fell in dollar terms.

A review of the contract published in 2015 by Mozambique's Centre for Public Integrity (CIP), a transparency organization, said official figures showed that the state collected just 8 percent of the revenues from ID documents produced between 2011 and 2014.

In October, Semlex issued a statement in Mozambique saying it had shut down its operations in the country, but alleging that its contract had been "unjustifiably" terminated. It called for an independent audit; the government rejected that request. A government official told Reuters the contract was terminated because Semlex had not met "the rules we agreed upon." He did not elaborate.

In the Comoros, a parliamentary commission of inquiry is investigating the sale of passports to foreigners to determine whether the process has been legal, who has been involved and where revenues have gone. Investigators have found that more than 2,800 Comoros diplomatic passports have been issued since 2008 in a country with a population of about 800,000. In that period, at least 184 diplomatic passports were sold to non-Comorans, data gathered by the investigators shows.

Since Semlex still produces all Comoros passports, the commission is investigating the company's role in the matter. Dhoulkamal Dhoihir, vice president of the Comoros National Assembly and chairman of the commission investigating the passports issue, said: "Semlex is a key player … We have convoked Karaziwan to come here."

The commission summoned Karaziwan in September, hoping he would give evidence. Semlex said Karaziwan would be available for questioning on Nov. 20. He did not turn up.

COMMISSIONS FOR OFFICIALS

Karaziwan was born in Aleppo, Syria, in 1958, in a family of eight children. In the 1980s, he moved to Brussels to study and went on to marry Laurent.

Over the years, Karaziwan developed businesses in real estate, restaurants and hotels, according to his company website and corporate documents. He set up Semlex in 1992 and prospered. In a copy of his CV shared with colleagues in 2008, Karaziwan said his businesses had a combined value of 100 million euros.

Semlex is a family company and not listed on a stock exchange. Its main operating unit, Semlex Europe, has a core of only about a dozen employees, according to company documents. Semlex emails reviewed by Reuters show the informal way Karaziwan and his associates have worked behind the scenes to punch above their weight.

In June 2004, for example, Helder Tavares Proenca, a writer and politician, was named as Semlex's agent in the West African country of Guinea-Bissau, according to Semlex documents reviewed by Reuters. In November 2005, Proenca became defense minister and in early 2006 Semlex won contracts to supply the country with passports, visas, ID cards and foreign resident cards, according to Semlex copies of the agreements.

Semlex documents show the company paid Proenca at least 80,000 euros ($94,000) between 2004 and 2009. Proenca was killed in 2009 in an assassination that police suspected was related to drug smuggling. Arnaldo Mendes, an official in charge of identification issues in Guinea-Bissau's justice ministry, said he could not comment on whether Proenca had influenced the awarding of contracts under a previous government.

In 2010, Semlex employees discussed in emails what percentage of revenue they would have to pay former and serving Guinea-Bissau officials to secure a further contract to provide the country with passports and resident cards for foreigners. According to Semlex emails reviewed by Reuters, a proposal was made to pay a commission amounting to 20 percent of the price each citizen would have to pay for a passport and 15 percent of the revenue that Semlex received for residence permits issued to foreigners.

On Jan. 24, 2011, a Semlex official asked Karaziwan to sign off on the offer. The next day, Karaziwan replied: "You can confirm it."

However, Guinea-Bissau government officials told Reuters Semlex did not win a further contract.

Other Semlex emails show that company staff described some payments as bribes. In November 2010, Michele Bauters, the firm's finance manager, asked an employee to detail how he had spent nearly 80,000 euros provided in cash for operations in Africa, according to Semlex emails reviewed by Reuters.

Much of the money had gone on rent and utility bills, the employee said, and 10,000 euros had gone on a "pot de vin" – French for bribes. The employee's explanation for what had happened to half of the 10,000 euros was blunt: "A bribe that Albert Karaziwan made me pay recently."

In response to the employee's apparent irritation at being asked for explanations, Bauters said Karaziwan had merely wanted to know how the money had been spent and made no reference to the mention of bribes.

Bauters did not respond to requests for comment by email. When Reuters rang Semlex headquarters, staff several times said she was busy.

Other documents illustrate how Semlex appears to benefit more than the state coffers of countries that agree to its deals. In 2013, Semlex extended an existing contract with Madagascar to supply passports and more than doubled the amount it charged. Under the new deal, citizens have to pay 36.25 euros (around $47) for a passport; of that, the state receives 2.5 euros and Semlex gets 33.75 euros, a contract between the two sides shows. Previously, Semlex received 15.50 euros per passport, the prior contract shows.

The cost of making such passports can be modest. Invoices from Imprimerie National, a French state-owned printing firm that used to produce blank passports for Semlex to complete with personal details, show that Semlex paid 1.75 euros to 2 euros per document for projects in Madagascar, Gabon and Comoros in 2007 and 2008. Semlex now has its own printing operation to produce passports.

 President Joseph Kabila of the Democratic Republic of Congo (L) is seen alongside Semlex CEO Albert Karaziwan during an event to launch the country's new biometric passports at the foreign ministry in Kinshasa in this still image taken from footage shot in November 2015 and made available to Reuters March 19, 2017. RTNC/Handout via REUTERS TV/File Photo

DIPLOMATIC POST

Through his high-level connections, Karaziwan was able to help non-Comoros individuals become representatives of the islands. From May 2010 to May 2011, Karaziwan was in frequent contact with Ibrahim Fahmi Said, then minister of foreign affairs in the Comoros, about diplomatic appointments, Semlex emails discussing honorary consulships show.

In July 2010, Karaziwan sent Fahmi a CV belonging to a Lebanese businessman called Nizar Dalloul. Karaziwan attached a covering letter saying he was corresponding in reference to Dalloul's nomination as the Comoros ambassador to UNESCO in Paris.

"As already discussed with the president, it would be good to move forward to nominate him quickly," Karaziwan wrote to the foreign minister. Dalloul was officially named ambassador on Sept. 1 that year, according to a decree signed by the Comoros president.

Dalloul told Reuters that the possibility of being UNESCO ambassador arose during talks he had with former Comoros president Sambi. He said he was named ambassador, but the appointment was rescinded shortly afterwards when Sambi left power. After this happened, Karaziwan did not seek to get him reinstated, Dalloul said.

In an emailed response to questions, Fahmi told Reuters that Dalloul had been named an ambassador by the president, not by him as foreign minister. He said Karaziwan had a role because he was an adviser to the president.

Fahmi said any relationship he had with Semlex was purely linked to work he did for the company as a lawyer, and that he did not receive any payment from them in relation to his work as a minister.

A spokesman for UNESCO said he could not comment on the matter.

Dalloul runs a company called Comium, which describes itself as a provider of internet services in Lebanon, Iraq and other areas of the Middle East, and as a leading provider of telecoms in Africa. He said he met Karaziwan through a friend who was looking for potential investors in the Comoros. Reuters could not establish why Karaziwan wanted to help Dalloul become a UNESCO ambassador.

Karaziwan also became involved in a Comoros program to raise cash by selling citizenship. The plan was mainly aimed at the stateless Bidoon people of Kuwait and United Arab Emirates who, for a variety of reasons, do not have citizenship of any country. The program offered the Gulf governments a way of helping the Bidoon without giving them citizenship, and it offered the Comoros a way to raise revenue, according to the law authorizing the scheme.

Comoros government documents from 2012 show that the country was paid just over $4,500 for each citizenship issued.

However, Comoros citizenship and passports were also sold outside the official program to non-Bidoon people – sometimes at much higher prices, according to Comoros investigators and sources with direct knowledge of Semlex operations. The passports are potentially valuable because they offer a citizenship with no tax obligations and can be used to open bank accounts and facilitate travel in the Gulf and beyond, law enforcement officials say.

The former Comoros government allowed some of these sales to be handled by a Dubai-based company called Lica International Consulting, according to a Comoros agreement with Lica reviewed by Reuters. Three sources, one with direct knowledge of Semlex operations, said Lica is controlled by Karaziwan. Two of the sources said Cedric Fevre, a business associate of Karaziwan, ran Lica on Karaziwan's behalf.

A lawyer representing Fevre, Henri Nader Zoleyn, said his client would not comment due to the confidentiality of contracts linked to passports and citizenship. When a Reuters reporter went to Lica's office in Dubai, no one appeared to be present.

Lica was meant to vet candidates for citizenship and pay the Comoros government $10,000 per document it issued, according to the agreement reviewed by Reuters. Two sources with direct knowledge of Karaziwan's activities said Lica asked at least 100,000 euros ($118,000) for supplying a Comoros passport.

A Comoros presidential decree, issued in March 2016 and reviewed by Reuters, shows a list of 21 foreigners, including an American, a South African and several Syrians, who had been proposed by Lica and granted citizenship by the president. A former Comoros government official said he knew of at least 23 other passports sold via Lica.

A Comoros decree from Dec. 28, 2015, reviewed by Reuters, authorized two prominent figures in the Democratic Republic of Congo to have Comoros citizenship and passports: Congolese presidential advisor Emmanuel Adrupiako and Makie Makolo Wangoi, a relative of President Kabila. Adrupiako and Wangoi were both involved in a separate Semlex deal to supply passports to Congo, as Reuters reported in April. Reuters could not determine clear how they obtained Comoros citizenship, or what role, if any, Lica or Semlex played.

In an email to Reuters, Adrupiako said he held no citizenship or nationality other than his Congolese one, and that he had never filed a formal, written request for other citizenship. However, Adrupiako said he did receive an unsolicited Comoros passport in his name in December 2015 after holding talks with a representative of the country over a potential tourism project between Congo and Comoros. Adrupiako said he sent the passport back.

Wangoi did not respond to an emailed request for comment and could not be contacted by telephone.

A Comoros presidential decree also shows that in July 2015 a man named Hamid Reza Malakotipour was granted Comoros citizenship. Malakotipour was sanctioned in 2014 by the United States, which alleged he held an Iranian passport and had helped to supply equipment to forces of Iran's Revolutionary Guards in Syria. Reuters was unable to establish how Malakotipour obtained Comoros citizenship or whether he acquired it through Lica or Semlex.

Reuters was unable to contact Malakotipour and could find no public response from him to being sanctioned. Mahan Air, the airline for which Malakotipour was working when he was sanctioned, declined to comment.

Also issued with Comoros citizenship was a Turkish-Iranian man named Mohammad Zarrab, according to the July 2015 Comoros presidential decree. In an indictment filed in the Southern District of New York in 2016, U.S. prosecutors accused Zarrab and others of violating American sanctions by carrying out hundreds of millions of dollars worth of business on behalf of Iran. Zarrab's whereabouts are unclear and he could not be contacted for comment.

Reuters was unable to establish how Zarrab obtained Comoros citizenship or whether he acquired it through Lica or Semlex.

In 2016, a new government came to power in the Comoros. Souef Mohamed El Amine, the current foreign minister, said the government is now trying to establish how many passports have been issued and who has received them. El Amine told Reuters that the government has a list of at least 100 people who had been provided with Comoros passports and were potential security risks.

"It doesn't matter if it is dozens or hundreds, it is the principle itself," El Amine said. He added: "Semlex is the one who makes the Comoros passports."

BELGIAN INVESTIGATION

On May 7, 2012, the public prosecutor's office in Brussels sent Karaziwan a letter calling him in to answer questions related to potential money laundering involving Semlex operations in Africa. Over the course of 2012, Karaziwan faced several rounds of questions about Semlex and its activities, prosecutor's documents reviewed by Reuters show.

At one point a lawyer acting for Karaziwan met the prosecutor and later told Karaziwan in a letter that the prosecutor planned to recommend an audit by the tax authorities or to file charges. Neither happened. Instead, the investigation was dropped in 2012.

Belgian authorities declined to comment on that investigation, but the federal prosecutor's office in Brussels told Reuters this month that it is currently examining Karaziwan's activities. Sources close to that investigation said it relates to the deal to provide passports to Congo, and that it is studying documents retrieved from the laptops and telephones of some individuals involved in the Congo deal.

Meanwhile, Semlex still has hopes for a bigger deal in Congo. The country's budget ministry has approved a government proposal to hand Semlex the contract to register and provide ID cards for Congo's 70 million citizens, according to a December 2015 Congo government letter seen by Reuters. No deal has yet been finalised. But if the contract does go ahead, it could be worth $430 million, the document shows.

As he did with the former leaders of the Comoros, Karaziwan appears to have grown close with the Congo government led by President Kabila, who is refusing to step down, a year after his mandate ended.

Earlier this year Karaziwan turned up at the United Nations again, according to the foreign minister of the Comoros, who saw him there. This time, though, Karaziwan was not with the Comoros team. He was with the delegation from Congo.

(Reporting by David Lewis in Moroni and Philippe Engels in Brussels. Additional reporting by Parisa Hafezi in Ankara, Bozorgmehr Sharafedin in London, Davide Barbuscia in Dubai and Alberto Dabo in Bissau. Editing By Richard Woods)

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