/ 6 February 2014

Fugitives hole up in Namibia

Poorly constructed ‘born-free’ roads run through rural areas because of dodgy tenders and budget cuts resulting from bribe payments.
Poorly constructed ‘born-free’ roads run through rural areas because of dodgy tenders and budget cuts resulting from bribe payments.

The arrest and extradition to Italy of convicted mafioso and Namibian resident Vito Palazzolo has turned a spotlight on Namibia as a relatively safe haven for fugitives from justice.

At least two other Namibian residents wanted for alleged crimes in other jurisdictions, Jacob (Kobi) Alexander and Boris Bannai, in the United States and Poland respectively, are resisting extradition.

Like Palazzolo, they have forged business links and friendships with politically connected members of the Namibian elite, including, in Bennai’s case, the son-in-law of Namibia’s President Hifikepunye Pohamba.

Palazzolo, also known as Roberto von Palace Kolbatschenko, arrived in Namibia in 2006 after staving off extradition from South Africa for more than 20 years. He bought a house and at least one farm in Namibia.

Arrested while on holiday in Thailand, he was extradited to Italy in December last year and is serving a nine-year prison term for Mafia-related offences.

There is one known successful extradition of a foreign national from Namibia – Lebanese businessman Fadi Ayoub, who was returned to France in September 2012 to face a rape charge. Ayoub fled France in 1993 after skipping bail and arrived in Namibia in 1999.

But others have successfully resisted similar moves by foreign governments.

In 2006, the Namibian Supreme Court upheld German national Hans-Jürgen Koch’s four-year battle to fight extradition to Germany to face fraud and tax evasion charges. Koch died in Namibia in 2008.  

Alexander has, since 2006, fought US attempts to extradite him to face charges of fraud, money laundering, obstruction of justice and witness tampering. Bannai has been wanted in Poland since 2010.

Both appear to have benefited from bungling by Namibian officials – or worse. Alexander was granted a work permit despite his alleged failure to disclose his residence in the US and the charges against him.

The Namibian Investment Centre, which falls under the trade and industry ministry, helped to expedite his permit after he promised to invest more than R300-million in Namibia. The centre can issue an investors’ status certificate, intended to smooth residence applications, if an applicant proves he or she has invested more than R1-million in Namibia or has R1-million in his or her bank account.

The magistrate threw out Bannai’s extradition case on grounds that the request from Poland failed to reach the court in time. But the Polish authorities strenuously deny this.

In court papers Bannai said that he has up to R300-million in investments in Namibia and that his Namibian company, Purity Manganese, employs about 400 workers and pays about R2-million a month in salaries.

Vito Palazzolo
The Namibian media linked Palazzolo (born in 1947) to questionable diamond-polishing licences and reported that he is the business partner of Zacky Nujoma, the son of former president Sam Nujoma, in diamond and uranium deals.

In 2007, Zacky Nujoma was quoted as dismissing Palazzolo’s organised crime links as “an old CIA story”. Last week he claimed not to have known about Palazzolo’s past. “Then I did not know him; now things have changed,” he said.

They had not been business partners, but “merely friends”, he said.

It is understood that in 2010 the Italian authorities, working through Interpol, began asking the Namibian government about extradition procedures, and that Italian officials visited Namibia to meet the authorities.

One government source told amaBhungane that the Italians voiced fears that Namibia might not help them, as Palazzolo had managed to resist extradition for more than two decades while living in South Africa.

The source said that local police and Interpol started monitoring Palazzolo’s movements. When he got wind of this, the source added, he and Zacky Nujoma confronted Namibia’s police chief, Inspector General Sebastian Ndeitunga, in his office.

Interviewed last week, Ndeitunga denied being confronted, but said he vaguely remembered Zacky Nujoma affording him “a courtesy visit” in which he introduced his business partner. “I remember someone who came to my office with Zacky Nujoma. I cannot recall the details,” Ndeitunga said.

Nujoma said he recalled the meeting and that it was to seek clarity on claims that Palazzolo was a wanted man. “I wanted to know what is happening since he [Palazzolo] and the media were saying different things.”

He recalled that “some form of communication structure” between Palazzolo and the police, including Interpol, was subsequently set up.

The Italians are said to have initiated a formal extradition process in late 2011. The source said the plan was to arrest Palazzolo on his return from Asia, but that it was “fortunate that he was arrested somewhere else, as extradition attempts would probably have failed here”.

Boris Bannai
Bannai, also known as Boris Biniashvili (56), an Israeli, has been doing business in Namibia since 2001 and then spent longer periods in the country from 2008.

Bannai’s main known Namibian associate and alleged business partner is oil exploration millionaire Swapo Ndume, Pohamba’s son-in-law.

The two men are regularly seen wining and dining at Windhoek’s posh Hilton Hotel, where Bannai occupies a suite. They are known to attend each other’s family events.

Last week Ndume confirmed that he and Bannai “are very good friends” but denied they are business partners.

He said he believed in Bannai’s innocence. The charges Bannai is facing in Poland arose from a legitimate business transaction, he said. “Now some people got greedy and are trying to take what is not theirs.”

In 2010, the Polish authorities asked the Namibian government to assist their investigations into Bannai, focusing on Purity Manganese, which runs a mine at Otjozondu, near the Namibian town of Okahandja.

According to an Interpol document seen by amaBhungane, the Poles accused Bannai of accepting an advance payment of $4.3-million from a Polish company, Eurostal, for manganese, which he then failed to deliver. The money was then laundered, including to “the accounts of other untraced entities”.

Asked to comment on these allegations, Bannai did not respond.

In 2012, Poland applied for Bannai’s extradition to face charges of fraud, money laundering, violating his fiduciary responsibility to his Polish company and manipulating its shareholding to benefit himself and his son David.

According to the Interpol document, a Polish district court concluded that Bannai was hiding from Polish law enforcement authorities and had failed to appear when summoned by the public prosecutor’s office.

An Interpol official motivated for Bannai’s arrest in Namibia, saying he was a flight risk. He cited the fact that Bannai left Namibia in December 2011 on an Israeli passport, which was valid until June 2016 and was tagged by Interpol to track his movements, but returned in January 2012 using another Israeli passport, which was valid until December 2021 but that was not tagged.

Approached for comment, Bannai denied any wrongdoing, saying the Polish authorities had never summonsed him.

“I have never had two valid passports and never was on any Interpol list,” he said in an email.

“Seems like [a] number of corrupted criminals including government employees [are] trying to offense [sic] me for personal gains.”

He said he did not need political protection and was unaware that Ndume could give it to him.

Following the Polish extradition plea, Bannai was arrested in Namibia in March 2012 and granted bail of R1-million. The court ordered him to report weekly to a Namibian Interpol representative. But his extradition hearing before Windhoek magistrate Ruth Herunga appears to have been botched by justice ministry officials.

Herunga threw out the case because the request was not made within 30 days of Bennai’s arrest, as per the country’s Extradition Act.  

However, Poland’s ambassador to South Africa and Namibia, Anna Raduchowska-Brochwicz, said that the request reached Namibia on April 21 – two days before the hearing – and that the Namibian authorities had confirmed receiving it.

Raduchowska-Brochwicz said three requests to Namibia for an explanation – on April 30 2012, October 29 2012 and May 16 last year – had gone unanswered.

A justice ministry source also questioned the failure to submit the documents on time, saying that the ministry had the option of filing the request over the weekend or on Monday before the court proceedings started. The official in question could also have informed Herunga that the request had arrived.  

A lawyer, who asked not to be named, questioned why the magistrate threw the case out so early in the day, rather than waiting for the close of business.  

Bannai is now suing the Namibian government for R10-million for wrongful arrest. AmaBhungane understands that he is back in his native Israel but it is unclear whether he plans to return.

AmaBhungane has also learned that, between 2002 and 2003, Bannai appeared before the West Virginia Mason County Court in the US on at least seven occasions for alleged offences involving his company Highlanders Alloys, including failure to pay workers and writing bad cheques to suppliers and workers.

In some of these cases Bannai paid fines.

Jacob (Kobi) Alexander
Alexander (born in 1952) first arrived in Namibia in about April 2006 and officially settled there in July 2006.

In hearings at the Namibian Investment Centre he pledged investments of R300-million if he received permanent residence. Court papers indicate that he initially brought in about R50-million to the country.

Two months later he made headlines in the Namibian media after being arrested at the request of the US government, which was seeking his extradition. A week later he posted bail of R10-million, a record for Namibia.

Insight Namibia magazine reported that approval of Alexander’s work permit application only took a day – another record.

This was disputed by the then home affairs permanent secretary, Samuel Goagoseb, who said the application took a week. But Goagoseb admitted to Insight that the rules were ignored when an earlier permit was granted.

In particular, the Immigration Control Board only received police clearance from Israel, not the US, and had no idea Alexander was wanted there.

AmaBhungane has also seen documents showing that Alexander’s work permit application was incomplete, and the Namibian authorities failed to pick up discrepancies in the application forms submitted by him and his wife, Hana, respectively.

Alexander is wanted in the US on 35 counts emanating from a stocks-option backdating scheme he allegedly ran at a New York firm he founded in 1986, Comverse Technology.

US justice department documents seen by amaBhungane put his “ill-gotten gains” at up to $138-million.

By the time the US government froze Alexander’s bank accounts he is alleged to have moved more than $64-million offshore to Israel.

Alexander’s friends in high places in Namibia principally include politically connected businessman Lazarus Jacobs, co-owner of the company Paragon Investments. Initially a media concern, Paragon is now involved in fishing, property development, mining and hospitality.

Jacobs is close to Namibian Prime Minister Hage Geingob, who is likely to become Namibia’s president in March next year. He also has ties with former president Sam Nujoma and chairs the parastatal Communication Regulatory Authority of Namibia.

Jacobs said he had received no money from Alexander other than “payments for advertising and marketing services such as billboards and radio adverts that our advertising agency [a Paragon subsidiary] provided to Kobi Alexander Enterprises”.

However, amaBhungane has seen a signed affidavit by Jacobs that states that Alexander provided a R3-million loan to Paragon.

Jacobs also says in his affidavit – which he submitted in support of Alexander’s application for residency – that Alexander paid the full R3.7-million purchase price for a hunting farm, Okatunda, in which the two men would have equal shares.

Last week he said he was the sole owner of the farm, which Alexander had not paid for.

Jacobs told amaBhungane that he and Alexander were friends, not business partners, and described as “unfounded” any suggestion that Alexander was seeking political protection from him.

In his affidavit he states that they had established a “professional, business and personal relationship”.

Alexander is currently challenging the constitutionality of Namibia’s Extradition Act. In responding papers, former justice minister Pendukeni Iivula-Ithana argued in 2008 that, “having successfully delayed his extradition to the US since 2006, [Alexander] is now attempting … to finally terminate any effort to have him extradited to the US”.

Alexander’s lawyer, Louis du Pisani, said his client would not comment.

Namibia’s ministry of justice refused to comment on Bannai or Alexander’s cases, saying they were “subject to confidentiality”.

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The M&G Centre for Investigative Journalism (amaBhungane) produced this story. All views are ours. See www.amabhungane.co.za for our stories, activities and funding sources.