When Kleptocrats Bring Money Into The U.S., There's Now A Plan To Seize It : Parallels Yachts, mansions, artwork and more, all bought with money allegedly stolen by Malaysian officials. It's the largest case to date for a Justice Department unit that investigates alleged kleptocrats.
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When Kleptocrats Bring Money Into The U.S., There's Now A Plan To Seize It

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When Kleptocrats Bring Money Into The U.S., There's Now A Plan To Seize It

When Kleptocrats Bring Money Into The U.S., There's Now A Plan To Seize It

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RENEE MONTAGNE, HOST:

One billion dollars - that's what the Justice Department is trying to recover in yachts, mansions and artwork all purchased here in the U.S. with laundered money. The Justice Department is using a special unit dedicated to tracking down international kleptocrats. NPR's Jackie Northam reports.

JACKIE NORTHAM, BYLINE: Some foreign rulers should get points just for pure audacity. Take General Sani Abacha, Nigeria's former authoritarian leader, who seemed to view the country's coffers as his own private ATM, says Stuart Gilman, a specialist in tracking down stolen assets.

STUART GILMAN: He would literally take suitcases full of money from the national bank and bring it to London and to Switzerland and to other places.

NORTHAM: And then there's Teodoro Obiang, the vice president of Equatorial Guinea. The Justice Department says he went on $100 million shopping spree here in the U.S. Jack Blum is a Washington lawyer who has worked on asset recovery cases for the U.N.

JACK BLUM: So we had Teodoro Obiang buy a $15 million mansion in Malibu. He had a collection of million-dollar cars. He had a private plane.

NORTHAM: All on a salary of $100,00 a year. In 2011, a special unit in the Justice Department went after Obiang's stolen assets. It's called the Kleptocracy Asset Recovery Initiative. It was created about six years ago and has worked on two dozen other cases involving dictators, corrupt foreign officials and royalty trying to park their money in the U.S., says Assistant Attorney General Leslie Caldwell.

LESLIE CALDWELL: Essentially, that dirty money really hurts our financial system and hurts our markets. If you're spending $30 million or $50 million in cash to buy an apartment in New York, it skews the market.

NORTHAM: Caldwell says U.S. real estate is a favorite place for kleptocrats to stash their stolen money because they use shell companies, which can easily help hide the identity of the owner. Shell companies feature prominently in the biggest case to date for the kleptocracy initiative. It involves the theft of $3.5 billion from the sovereign wealth fund in Malaysia. According to court papers, $1 billion dollars of those stolen proceeds was spent in the U.S. on luxury hotels, executive jets, millions of dollars at the gambling casinos and to help finance the movie "The Wolf Of Wall Street."

(SOUNDBITE OF 71ST GOLDEN GLOBE AWARDS TELECAST)

JENNIFER LAWRENCE: And the Golden Globe goes to Leonardo DiCaprio, "The Wolf Of Wall Street."

NORTHAM: Leonardo DiCaprio thanked the team behind the film's financing when he picked up his 2014 award for best actor at the Golden Globe Awards. There are no allegations DiCaprio did anything wrong. But the case implicates Najib Razak, Malaysia's prime minister who denies all allegations. Gilman says seizing assets from a foreign leader still in power can cause a diplomatic nightmare, but he says that can't impact the case.

GILMAN: Because Malaysia - the prime minister, he's not going to live forever. And when he's out of office and all this money is discovered in the U.S., are we better off having been proactive or basically wait till the prime minister dies and then, you know, apologize?

NORTHAM: It's one thing to seize the stolen assets, another to retain them. The accused in all these cases employs a raft of lawyers, and it's difficult to find witnesses and evidence overseas. So far, the Kleptocracy Asset Recovery Initiative has about a 10 percent success rate. Still, Assistant Attorney General Caldwell says the unit has been successful for a relatively new initiative.

CALDWELL: I don't think the success of the kleptocracy initiative should necessarily be measured by the dollar amounts that we recover. I think it should be measured by the fact that we're doing it at all.

NORTHAM: Caldwell says the unit is only going after those plundering their countries on a massive scale. She says there are more cases in the pipeline.

Jackie Northam, NPR News, Washington.

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