Somalia govt officials use private companies as a proxy to launder stolen money, receive kickbacks

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Somalia govt officials use private companies as a proxy to launder stolen money, receive kickbacks

MOGADISHU, Somalia (HORN OBSERVER) Officials within Somalia government are now implicated in a new money laundering scheme and kickbacks going off the radar of the finance ministry and other regulators, current and former government officials have no

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A screegrap of the CAFIS website shows board members. | Photo taken Jan., 11 2022.

MOGADISHU, Somalia (HORN OBSERVER) Officials within Somalia government are now implicated in a new money laundering scheme and kickbacks going off the radar of the finance ministry and other regulators, current and former government officials have now exposed.

The revelation follows after Marqaati, a local anti-corruption watchdog, recently released a report on Somalia's worsening corruption crisis saying that it is fuelled by lack of accountability.

The ministries hit hard by the corruption includes the Ministry of information, whose deputy minister, Abdirahman Yusuf Omar (alias Abdirahman Adaala) was identified as the most corrupt official within the institution.

"For instance, the national newspaper 'Dalka' budget amounts only 30% of the costs actually incurred. The rest 70% goes to the Abdirahman Adaala's pockets,” Farah Dharar, the former director general of the Somali National TV which the state-owned television said.

Dharar who resigned few years earlier stated the existence of undisclosed contracts between the service provider companies - such internet and satellite - which varies from the actual contract in the government registry.

"These contracts are not the actual agreements observed by the ministry of finance. We have tried to get hold of it but nothing happened because the top officials in the ministry are the ones implicated in this scheme," he add.

According to the Appropriation Act for 2023 Budget, the ministry of information receives $6,217, 798 in the 2023 fiscal year, while the ministry received 5,326,889 in the 2022 fiscal year.

Farah Dharar, the former director general of SNTV concurs that more than $100,000 was allocated for satellite subscription for the state television but only less than a half of that is utilised. "Almost the ministry receives over USD 100,000 USD and the money goes to their private pockets," he says.

In its report, the Marqaati group wrote that the past five years saw government contracts continued to be given to political cronies of those in power, enabled by an opaque procurement process. Not only were kickbacks the norm, but some officials were also reportedly shadow owners of companies to which they awarded contracts.

"Ministries, departments, and agencies (MDAs) continued to collect fees and use them at source, contrary to the law. When the Auditor General (AG) reported on MDAs that shared statements with him, he could not find many MDAs willing to share information with him in subsequent years," the Marqaati group said.

To the worse, the group documented that $5,936,316.23 of the cash Somalia received in the external assistance could not be accounted for in the year 2020.

One current official (whose name withheld due to security reasons) at the Office of the Auditor General told Horn Observer that in addition to the stealing of funds from the budget, the Auditors found that officials at the ministry of information were collecting fees from organisations as a source of income but these fees were never submitted to the finance ministry.

"We found that the information ministry was collecting fees from non-governmental organisations and companies without the receipt of the finance ministry. These monies was used by certain powerful individuals. This needs to be fixed," he added

CAFIS COMPANY

Among the private companies used as proxy by the ministry officials is called CAFIS as described by the former and current officials. CAFIS was first registered under the ministry of information as a private non-governmental organisation in 2018. According to its website, it seeks to "promote[s] peace, reconciliation, human rights, forgiveness for community integrations, freedom of expression and media development in Somalia." On the same website, it claims that "CAFIS Org. raises awareness on radicalization, homegrown terrorism, human trafficking, and environmental conservation."

According to its registration papers seen by the Horn Observer, the registration was authorised by Abdirahman Yusuf Omar "al -Adala" who was then the acting director general of the ministry of information. However, its website states Mohamedkafi Sheikh Abukar, the director of the state-run Radio Mogadishu as the chairperson while the deputy minister Abdirahman Yusuf Al-adala is a board member.

Other board members of CAFIS include Abdirahman Koronto, the information ministry advisor, member of parliament Mohamed Ibrahim Moalimuu and another member of parliament Ifrah Awed Ali. Bylaw, the federal lawmakers are prohibited to work in private companies or receive payments from private organisations while serving in the parliament.

SELLING ALLEGEDLY FAKE PASSPORTS

Liban A. Shadiro is the CAFIS Executive director, according to the organisation's website. However, a counter-check conducted by this reporter reveals that Liban Shadiro has previously worked in Somaliland before he fled to Mogadishu. A Somaliland police report mentions Shadiro of involving in selling fake passports into the black market in Hargeisa and human trafficking.

"Liban A. Shadiro escaped the police for selling fake passports to Somaliland citizens and human trafficking. These include stolen European, American and Somali passports to individuals attempting to migrate to Europe," the report notes.

A 2014 report by the Somali immigration authorities reveals of the arrest of two men and the seizure of 42 fake passports with Sudan Visas at Mogadishu international airport. The Horn Observer is yet to verify whether Liban Shadiro was among the two arrested persons.

When The Horn Observer contacted the CAFIS Executive director Liban Shadiro, the person responding to our call said he did not know "anybody with the name "Shadiro". Abdirahman Yusuf Omar "al -Adala" and Mohamedkafi Sheikh Abukar did not respond to our queries. However, Mohamed Ibrahim Moalimuu told Horn Observer that he is not "a member of the CAFIS board." Abdirahman Koronto was not reachable at the time of this publication and lawmaker Ifrah Awed Ali said she resigned a year ago from CAFIS.