Preface (September 2021)

This report of ReCommon was closed and published in Italian in November 2020. In the following months, the criminal proceedings in Milan against the most important Italian multinational company, Eni, and one of its top managers regarding their investment in the Republic of Congo had unexpected developments. On March 25, 2021, the judge for preliminary investigations Sofia Fioretta of the Court of Milan issued a plea bargaining sentence that sanctioned Eni to pay compensation of €11 million and a fine of €800,000 for the crime of improper inducements in the context of the renewal of Marine VI and VII oil licenses, which took place in 2014 in the Republic of Congo.

Regardless of today’s judicial outcome, there remains a shadow over the involvement of Descalzi’s family members in Eni’s operations in the Republic of Congo, a deal whose due diligence and decision, according to the CEO of Italy’s largest multinational company, are not his responsability.

Background

It all started with Aogc, a small and unknown private oil and gas company. On 15 April 2013, in Brazzaville, the capital city of the Republic of Congo, the dictator Denis Sassou Nguesso issued a new directive on hydrocarbons. The official goal was to pave the way for the energy industry development in Congo, encouraging local business to bid for oil licences, which so far had been almost entirely in the hands of foreign multinationals. Basically, Sassou Nguesso was telling Eni and Total, the two oil majors that have always been sharing the exploitation of the former French colony’s oil reserves, to assign shares of their licences upon the expiration and subsequent renewal. However, in his directive, Sassou Nguesso set out that stakes in oil licences be assigned to local private companies of the sector and not to the state oil company of Congo, the existing SNPC. At the time the directive was adopted, in Congo there was only one private company operating in the extraction of gas and oil: the Africa Oil and Gas Corporation, better known as Aogc.

Shadows on AOGC

Aogc was incorporated in 2001 by Denis Gokana, a special adviser to Sassou Nguesso for oil matters, both from the same ethnic group (Mbochi). The company was not very well known internationally, except for allegations of acting as the hidden bank account of the presidential family. In fact, a decision delivered in 2015 by the English High Court, established that the government of Congo transferred at least 472 million dollars on the accounts of Aogc and of other companies owned by Gokana, over two years. The money was used to buy oil, at prices much lower than the market prices, from the state company Snpc, that was run by Gokana for many years, and selling the oil to independent traders with significant capital gain. Aogc itself, according to the British NGO Global Witness, paid more than 250,000 euro in past years, for shopping trips in Paris by one of the President’s son, Denis Christel Sassou Nguesso. In spite of all this, Aogc immediately entered the game opened by the President’s new directive, with Eni as its first partner.

“Renewal in exchange for stakes”

On 18 November 2013, Congo renewed four oil licences to the Italian company, and i.e. the exploration permits for the oil blocks Marine VI and Marine VII, in particular for the Djambala 2, Foukanda 2, Kitina 2 and Mwafi 2 oil blocks. However, at the same time, Eni transferred stakes of those four oil blocks (from 8 to 10% shares) to Aogc. Something very similar happened two years later. On 14 July 2015, along with the French company Total, Eni obtained the re-award of the Secteur Sud exploration permit of Tchibouela, Tchendo and Tchibeli-Litanzi blocks. Also in this case, the renewal of licences resulted in a reduction of Eni and Total shareholding. The two multinational corporations saw their position weakened to the benefit of new companies identified by the Congo’s government, including Aogc, once again.

ENI changed version

Aogc case gained international attention on 14 April 2015 when the British newspaper The Times published an article revealing that two years before Eni transferred to the Congolese small private company its shares in Djambala 2, Foukanda 2, Kitina 2 and Mwafi 2 oil blocks. “We didn’t choose it”, replied Claudio Descalzi to Re:Common and Global Witness, when the partnership with Aogc was brought to the attention of Eni’s shareholders, for the first time, on 13 May 2015. Descalzi’s reply raised the attention of the weekly Italian magazine L’Espresso, which, immediately after Eni shareholders’ meeting, published a small article on that matter, the first in a long series. After three months, the magazine published an insight article reporting about the new Congolese directive on oil & gas. When asked by L’Espresso to disclose the identity of Aogc’s shareholders, Eni ensured that, at the time of the operation, there were no public officials. Another month had gone when the magazine revealed that this was not the way things were. Referring to a report by the French legal firm Ghelber & Gourdon on behalf of the Republic of Congo, L’Espresso informed that two Congolese public officials were actually the top managers of Aogc: Lydie Pongault, Sassou Nguesso’s advisor for culture, and Dieudonné Bantsimba, head of Ministry of Land’s cabinet. When asked (again) by the magazine, Eni appeared to indirectly admit it failed to provide that information, but it specified that Bantsimba’s and Pongault’s offices “are not considered to be in conflict with their position as shareholders, given the different areas of activity that have nothing to do with the oil & gas sector”. Milan Prosecutors’ Office didn’t think the same way. Luigi Zingales - an independent member of Eni’s board of directors – didn’t think the same way either. He disapproved Eni’s partnership with Aogc, and on 15 July 2015 he announced his resignation “due to irreconcilable differences of opinion on the role of the Board of Directors in the management of the company’’.

The Marine XI case

Two years passed by. On 6 July 2017, the Italian Tax Police, by order of Milan prosecutors, served a notice of investigation to Eni for international corruption in Congo. Investigators seized the agreements executed by the company in Brazzaville from 2013 to 2015. They found the agreements entered with Aogc, and a lot more. In 2013, just when it was obtaining Eni’s shareholdings in four important licences in Marine VI and Marine VII oil blocks, Aogc was reducing its shareholdings in another Congolese jewel, the Marine XI oilfield. In the same year, Denis Gokana’s company, in which two Congolese public officials had an interest, transferred 23% of Marine XI shares to an unknown company, the World Natural Resources. After examining that strange purchase and sale, the Milan Prosecutors’ Office decided to investigate on a number of people for international corruption. First of all, Roberto Casula, the then Eni’s Chief Development Operations & Technology Officer, the second-most important executive after the CEO, Claudio Descalzi.

Getting the bribe back

Milan Prosecutors’ Office alleged that, in return for the renewal of some oil licence by the Congolese government (Djambala 2, Foukanda 2, Kitina 2 and Mwafi 2), Eni had “donated” stakes in those oil blocks to a company (Aogc) belonging to Congolese public officials linked to the President Sassou Nguesso. In short, bribes did not consist of money transfers or suitcase full of cash, but in pieces of oil blocks, which are deemed to deliver returns over time. And not only that. According to the Milan Prosecutors’ Office, the scheme included a “partial refund of the bribe”. In fact, the seizure order issued on 30 March 2018 by the public prosecutors Paolo Storari and Sergio Spadaro reads: “Unlawful agreements provided for the assignment of 23% of Marine XI licence to World Natural Resources Limited”, a company allegedly owned by other three people that are indicted on international corruption charges: Alexander Haly, Ernest Akinmade and Maria Paduano. All of them are “individuals linked to Eni spa”, the public prosecutors wrote in their seizure order.

Family business

This is the start of a judicial investigation that went so far as to involve Descalzi, who had just been appointed for the third time as CEO of Eni, the Italian state-owned company, controlled by the Ministry of Economy and Finance and by the Cassa Depositi e Prestiti. At present, Descalzi is not indicted for international corruption. He is accused of failing to disclose the potential conflict of interest involving her wife, Maria Magdalena Ingoba, for millions of dollars. Actually, according to the Milan Prosecutors’ Office, Mrs Descalzi allegedly benefited of contracts awarded by Eni to Petro Services, a group of companies belonging to her, located in Congo, Gabon, Ghana and Mozambico. However, this is not the only incongruity brought to light by the Milan prosecutors on Eni’s business in the Republic of Congo. They collaborated with French investigators, who have long been investigating on alleged misuse of Congolese public money by Sassou Nguesso’s family members to buy private assets abroad. The Italian investigator purportedly found a company whose beneficiaries include Descalzi’s wife, Marie Magdalena Ingoba, and the Congo President’s daughter, Julienne Sassou Nguesso. The company name is African Beer Investment Ltd, incorporated in the Mauritius Island, as reported by L’Espresso in October 2018.

Marcegaglia was in a hurry

Eni has repeatedly changed version about their deals in Congo. Not only it first denied that among Aogc’s shareholders there were public offices, and then - in the wake of the press revelations – it minimised them, it did the same about Petro Services, the group of companies of which Descalzi’s wife has been a shareholder for years. Petro Service Group is one of Eni’s suppliers? On 13 April 2017, Re:Common officially asked that question during the shareholders’ meeting, and the then chairman Emma Marcegaglia answered “at present, there are not contractual ties between Eni and Petro Services in Congo”. In the following months, L’Espresso and then Il Fatto Quotidiano reported that Petro Services has supplied services to Eni in Congo since 2008 at least, for total consideration of 104 million dollars. The following year, when pressed by Re:Common at the shareholder’s meeting of 2018, Marcegaglia adjusted her answer. She declared that between 2012 and 2017 “vessel services supplied by Petroservices to Eni Congo amount to about 104 million dollars”. Why did she deny having business relationship with Petro Services, the year before? The then Eni’s chairman explained that, due to a “hurried reading” of the answer, she unintentionally left behind a sentence. Which sentence? Precisely the one reporting the services supplied by Petro Services in the past.

Descalzi: Without my knowledge

When Marcegaglia gave this reply, the alleged relation between the Petro Services group and Ingoba, Descalzi’s wife was not known yet. The news was reported by Espresso, on March 2019. In September, Mr and Mrs Descalzi were placed under investigation for failure to disclose the potential conflict of interest. The allegation is “ungrounded”, the CEO remarked. “Transactions between Eni Congo and Petroservice group – he explained - have never been submitted to me as they are totally unrelated to my role. I would like to point out that, if I was or became aware of any conflict of interest situation, I would not hesitate to disclose it, as required by Eni policies and by the law.” The company has instead specified that it carried out "in-depth analyses" on the relations with Petro Services. “Those investigations”, Eni stated in its website, “ruled out any violations or conducts to the benefit of and/or to the detriment of Eni, seeking to benefit contracted suppliers of services, in particular Petroservice group, with regard to the facts under investigation.”

Characters

MARIE MADELEINE INGOBA

She is Claudio Descalzi’s wife. He met her in Congo in mid 1990s, when the Milanese manager worked in the former French colony as the head of Eni’s local branch, which has been operating since 1968. Marie Madeleine Ingoba, nicknamed Mado, born in 1963, mother of four children, is under investigation by Milan prosecutors for international corruption and, in another case, for failure to disclosure potential conflict of interest. We know very little about her. On the website of the Ingoba-Descalzi foundation, created in 2015 with the official goal to support children education, inspired by Nelson Mandela’s legacy, Ingoba describes herself as the daughter of “Italian-French father (high profile restaurant owner in Congo) and of Congolese mother”, grown up in Brazzaville, she transferred to Paris to attend university. She has always been working as an entrepreneur in various sectors, from real estate in Congo to fashion. Mrs Descalzi has been living abroad for several years, but she had maintained extensive business interest in her home country. Let start with the interests that have, theoretically, less to do with Eni. The company name is African Beer Investment Limited, it is registered in Mauritius tax haven; however, looking at the names of the alleged shareholders, a strong link appears to exist between Descalzi’s wife and the family of the president and master of Congo, Denis Sassou Nguesso. In fact, there are the owners: Julienne Sassou Nguesso, the President’s daughter; Mrs Ingoba, Descalzi’s wife; Hubert Pendino, French business man suspected by French prosecutors of being one of Denis Sassou Nguesso’s front men. News on African Beer Investment Limited have been published in October 2018 by L’Espresso, according to which the shareholders’ names resulted for a search carried out by the French investigators at Pendino’s house, in Cote d’Azur. The magazine reported that the company established in Mauritius “appears to run business in line with its name: brewers. Documents seized from Pendino’s house include brewery equipment purchase requests.” On Eni’s case, he never made any comments, he said “the company doesn’t know and has nothing to say on relationships among third parties”, during the shareholders’ meeting in 2019. Descalzi’s wife, instead, firmly denied L’Espresso’s allegations: “in my home country, Congo, I have always worked as an entrepreneur in various industries. I do not and did never partner with the daughter of the Congolese president, Julienne Sassou Nguesso, nor with Hubert Pendino in those activities”, Ingoba said to some media after L’Espresso’s revelations.

Established in 2012, today the African Beer Investment is struck off from the Register of companies of Mauritius. The French investigators’ documents that were sent to the Milan’s prosecutors allegedly unveiled another link between Descalzi’s wife and Julienne Sassou Nguesso. According to L’Espresso, before incorporating the African Beer Investment, in 2012, the daughter of the Congolese dictator allegedly received very expensive gifts from Ingoba. Design objects and brand name accessories for a total value of 700,000 dollars. Eveything was paid by Descalzi’s wife, from 2007 through 2012, through a current account belonging to one of her Congolese companies. Supposedly, the flow of gifts stopped exactly when African Beer Investment was incorporated.

However, the Mauritius-based company, jointly owned with the president’s daughter, is not the only offshore company owned by Descalzi’s wife. Until a few years ago, Mrs Ingoba – as reported by L’Espresso, in July 2016 - resulted to be the owner also of Elengui Limited, incorporated in the British Virgin Islands, in 2012. Why? “The company was incorporated for the only purpose of being used to develop a real estate project in Brazzaville, i.e. the renovation and modernisation of a hotel in the capital of Congo. However, the project never materialised”, Ingoba explained to the magazine. Descalzi said he did know nothing about that company, while she claimed that the Elengui Limited “never had any relationship with Eni.” Certainly, the offshore shell company owned by Descalzi’s wife was short-lived. It was struck off from the register of companies on 30 April 2014, two years after Descalzi was appointed as Eni’s CEO by the then Italian Prime Minister, Matteo Renzi.

However, there is a particular circumstance regarding Elengui. While it was registered for tax purposes in the British Virgin Islands, it appears that the company was resident at the 4801 PObox of Pointe Noire, Congo. Exactly the same PObox of another company that, instead, dealt a lot with Eni. It is the Petro Services Congo Sarl, a long-established supplier of Eni and, according to the Milan Prosecutors’ Office, owned by Ingoba. To understand how Descalzi’s wife is involved, it is necessary to examine the company structure. The Italian newspaper Corriere della Sera described it in details on 27 September 2019, when the Descalzi-Ingoba’s home was being searched. Petro Sevices Congo Sarl belongs, together with other companies operating mainly in Western Africa, to the Petroserve Holding BV Dutch group, managed by a British citizen, Alexander Haly. The group is controlled by a Luxemburg private company, Cardon Investment S.A, directed by Haly. The company is controlled by two trust companies based in Cyprus: Cambiasi Holding Ltd, holding 66% of shares and owned by Descalzi’s wife; Maggiore Ltd, holding the remaining 33% of shares, owned by Haly. According to L’Espresso, the link existing between Ingoba and Petro Services group resulted from a report sent to the Milan Prosecutors’ Office by the Luxembourg anti-money laundering authorities. The report was received in Spring 2018, shortly after a search carried out in Haly’s office in Montecarlo, upon the request of the Italian prosecutors. The Luxembourg authorities have identified Mrs Descalzi as the first beneficiary of Cardon Investment S.A, hence of the Petro Services group, for at least five years, from 2009 through April 2014. Precisely when her husband held the office of Eni’s CEO, Marie Madeleine Ingoba allegedly transferred the control of the group to Haly, who was already a director. All the above was the reason for placing Descalzi and his wife under investigation for failing to disclose potential conflict of interest, since - according to the prosecutors - a group belonging to a top manager’s wife had been one of Eni’s suppliers for years. It not clear, yet, how much money Eni paid to the Petro Services group. The search warrant ordered by the Milan prosecutors, in March 2018, explained that documents provided by the Italian group shows that between 2012 and 2017 Eni’s office in Congo paid to Petro Service Congo Sarl 104 million dollar, allegedly in addition to the sums the other companies of the Petro Services group in Mozambico, Gabon, Ghana, Nigeria, Angola, Emirati Arabi, Qatar received in the same period for additional supplies to Eni. L’Espresso reported a total amount of 310 million dollar, based on the Italian Tax Police assessment. Which is incomplete, the magazine pointed out, because the Petro Services group has been working for Eni since 2009, at least, while the contracts under investigations start from 2012. However, Descalzi said that allegation of failure to disclose conflict of interest is “ungrounded”, explaining that “transactions between Eni Congo and Petroservice group were never the subject of my consideration and decision, as fully outside my role.” Descalzi also to pointed out: “if I was in, or became aware of, any conflict of interest situation, I would not hesitate to disclose it.” Therefore, it is not clear whether the manager knew that his wife was linked to Petro Services. He claimed that he certainly never dealt with relations with that company. Eni, for its part, made clear that “it has long since appointed internal supervisory boards (Risk Management Committee and the Board of Statutory Auditors) as well as third party and independent advisors (legal and technical experts) to carry out in-depth analyses, which excluded any violations or conducts to the benefit of and/or to the detriment of Eni, seeking to benefit contracted suppliers of services, in particular the Petroservice group, as far as the facts under investigation are concerned.” In short, contracts awarded to Petro Services did not damage Eni. A significant clarification. The penalty for the offence of failure to disclose potential conflict of interest is up to 3 years imprisonment, but only if “it caused damages to the company or to third parties.

ALEXANDER HALY

Alexander Anthony Haly, born in 1982 in UK and residing in the Principality of Monaco, is investigated by the Milan prosecutors for international corruption. In the search warrant of March 2018, the prosecutors wrote he was a manager indirectly linked to Eni, as well as an integral part of the corruption scheme based in the Republic of Congo. At the time of the search, Haly was the most important manager of the Petro Services group, which also controlled the Congolese Petro Services Congo Sarl. Between 2012 and 2017, the company was awarded contracts for 104 million dollar from Eni local branch to provide rental of commercial vessels and supply various logistic services, as reconstructed by Milan prosecutors. Haly was not only the director of Petro Services group, but also one of the two shareholders, the other was Marie Madeleine Ingoba, Descalzi’s wife. Through the Cypriot Maggiore Ltd, Il Corriere della Sera reported, the British manager controlled 33% of the Petro Services group. In Spring 2014, just before Descalzi took over as Eni’s Ceo, Ingoba sold her shares to Haly, who therefore became the single shareholder of the group based in the Netherland. It is not clear how much Haly paid to purchase Mrs Descalzi’s shares. It is certain that the manager residing in Montecarlo is not only linked to Petro Services, Eni’s supplier. He was under investigation on charge of international corruption due to his relation to another company: the World Natural Resources Congo SA. In 2013, shortly after being incorporated, this company purchased 23% of Marine XI licence from Aogc: an operation that Milan prosecutors described “as if money is kicked back to the briber: in other words, in order to encourage the bribe giver, the bribe taker pays him benefits that are technically considered the price for the crime.” An article published by L’Espresso in April 2018 revealed that the purchase was very profitable for the shareholders of the World Natural Resources Congo, as they paid only 15 million dollars for an asset worth as much as 430 million dollar, at that time. The magazine discovered the identity of the individuals involved in the deal, after scrutinising thousands of documents from the so-called Paradise Papers database, a huge archive of offshore corporate documents obtained by the German newspaper Sueddeutsche Zeitung, and shared with the international consortium of investigative journalists, ICIJ. World Natural Resources Congo, that purchased 23% of Marine XI oil block, is controlled through a complex chain of shell companies by four people: three Italians and a Briton, Haly. Until 2015 at least, Haly owned 25% of the British World Natural Resources Ltd, through a London company, Oligo Limited, of which he is still a director and majority shareholder. World Natural Resources Ltd controlled World Natural Resources Congo through two companies based in Mauritius tax haven. It is clear that Haly has been having relations with Eni for long time as a supplier.

PIERANTONIO TASSINI and SERGE PEREIRA

In the search warrant of March 2018, Milanese prosecutors highlighted another link with the oil giant. “Haly is also a director of Cap Energy PLC, whose chief operating officer is Pierantonio Tassini, with a four decade experience in Eni”, the investigators wrote, defining Tassini “a close collaborator” of Haly and ordering a search also of his home. Until November 2017 at least, Pierantonio Tassini, an engineer born in 1943, described himself in his Linkedin profile as “vice president LNG for Africa and Middle East at Eni E&P.” Cap Energy is an oil company incorporated in England, operating from 2005. Latest financial statements were published in 2015. The company stated that it was focused on oil&gas and that between 2013 and 2014 it became the owner of two important exploration licences, in Senegal and in Guinea Bissau. Haly and Tassini - both joined Cap Energy on 15 February 2013, Haly as a non-executive director, Tassini as the Chief Operating Officer - are not only managers but also shareholders of the company. Tassini holds 0.8 %, Haly holds 3.9 %. The majority interest (70.7%) is owned by an offshore company established in the British Virgin Island, Global Energy Trade Limited. Who is the owner of that company? According to Cap Energy’s corporate documents that Re:Common has read, until the second quarter of 2019 at least, Haly was the majority shareholder of Global Energy Trade Limited.

Among Cap Energy’s shareholders there is another individual linked to Eni’s top management, he is Serge Pereira, Descalzi’s son-in-law. He is the son of Roger Pereira, former head of cabinet of Sassou Nguesso, Serge is the husband of Cindy Descalzi, eldest daughter of Ingoba and Eni’s CEO. Pereira is one of the richest entrepreneurs in Congo, with interests across Central Africa. His construction company, Unicon Development, has secured significant contracts without any tender process by the Sassou Nguesso’s regime, L’Espresso reported. Pereira replied that all works executed in Congo – spanning from Denis Sassou Nguesso University and the Cité Gouvernementale in Brazzaville to Nelson Mandela Hotel or the Sport Complex for the African Games - “have been awarded under strict and competitive legal procurement processes.” As did Marie Madeleine Ingoba and Claudio Descalzi, also Cindy and Serge created a humanitarian foundation. It is Congo Kitoko and it professes to be actively engaged in helping children, women and the environment. In the explanation provided to L’Espresso, Descalzi’s son-in-law has also pointed out that he has “invested in Cap Energy Plc before meeting his current wife”, and that the oil company established in the United Kingdom “has never had any relationship with the Eni group and does not operate in the countries where Eni carries out its business.” In fact, Senegal and Guinea Bissau are not included among the African countries where Eni officially operates. However, Cap Energy has a branch in Nigeria, where the Italian company has been operating for several years, and with huge business interests. The affiliate company is Haru Energy Limited, established in 2012, providing downstream oil and gas services. Haly, Tassini and Pereira are among the directors of the company. The Lebanese manager Lina Haidar serves as CEO of Haru Energy and of Cap Energy. She is residing – as Haly – in the Principality of Monaco and holds a minority stake of the group through the offshore company based in the British Virgin Islands, the Global Energy Trade Limited. Haly also owned the Nigerian Haru Energy, at least until mid 2019, as it was directly controlled by Cap Energy,. In summary, the young British manager residing in Montecarlo has been for several years a supplier of the Italian company jointly with Descalzi’s wife through the Petro Services group. He became the owner of the Congolese Marine XI oil block jointly with Eni’s employees and former employees. He has controlling interest in an oil group with interests across several African countries, including Nigeria.

HUBERT PENDINO and JULIENNE SASSOU NGUESSO

“He is at present a major private investor in the Republic of Congo, in particular in the real estate sector.” This is reported in Hubert Pendino’s public résumé. He arrived at Brazzaville as early as 1968, a French successful entrepreneur and manager. In 2008, he was awarded of the French National Order of Merit in Paris. As a majority shareholder, from late 90s, of the Congolese Socofran, a private company that has carried out large-scale public works under state contracts, and as a member of the Pointe Noire Rotary Club for 30 years and chairman of the board of directors of Congolaise de Banque, an important bank of Congo, Pendino is one of the richest and most powerful white men in the country that has been governed for the past 40 years by Denis Sassou Nguesso. His public résumé doesn’t mention that Pendino is much more than that. As reported by L’Espresso in October 2018, he is one of African Beer Investments Ltd’s shareholders, the above mentioned offshore shell company established in Mauritius, of which also Marie Magdalena Ingoba and Julien Sassou Nguesso are alleged shareholders. Descalzi’s wife, the daughter of the Congolese dictator and the French businessman, all of them hide behind a corporation that officially deals with bear. This resulted from investigations the French police has been carrying out for long time on the wealth that Sassou Nguesso administration took from the population and privately invested all over the world. The investigation was defined Biens mal acquis (ill-gotten gains), and focuses on hundreds of million dollars that were drained from Congo’s public coffers and used - according to French investigators - to purchase villas, apartments, hotels and luxury goods in France. This wealth strongly clashes with the life conditions of the majority of Congo’s population, where one citizen out of two struggles to live on less than one dollar a day, according to World Bank data.

During the search of Pendino’s house, in the French Riviera, the French police seized several confidential documents: bank account certificates, real estate properties, offshore companies. They also found documents about the Mauritius-based African Beer Investments Ltd, bearing the names of its beneficiaries. Pendino is considered to be one the French individuals closest to Sassou Nguesso regime.

Julienne Sassou Nguesso, her partner in African Beer Investments Ltd, is investigated in France on similar charges: money laundering and misuse of public funds, as reported by Agence France-Presse in 2017. According to the agency press, the daughter of Sassou Nguesso allegedly used a private limited company established in the Seychelles to buy and refurbish a house with seven bedrooms in Neuilly-sur-Seine, an elegant village located north-west of Paris. She spent a total amount of 10 million euro, which is hard to justify as she is an insurer by profession. Moreover, during the Bien mal aquis inquiry, the French investigators allegedly found the evidence that million euros of public money were transferred from Brazzaville coffers to private companies’ accounts based in Seychelles, Mauritius and Hong Kong. Prosecutors assert that the money was finally used by the family of president Sassou Nguesso to buy luxury goods around the world. “This story has been going on for 10 years and will be dismissed”, Jean-Marie Viala, counsel of Denis Sassou Nguesso, said to AFP.

In the meantime, a similar inquiry resulted in a committal for trial in San Marino. In September 2019, the Republic of San Marino has confiscated 19 million euro belonging to the dictator’s family members. That money is alleged the proceeds of money laundering, as they were withdrawn from Congo’s public coffers through a variety of fraudulent artifices and transferred to the accounts of Banca Commerciale Sammarinese for the purposes (sometimes allegedly fulfilled) of private shopping by the Sassou Nguesso family. How? By spending them in hotels, flights, cloths, crocodile shoes, jewellery, watches, design objects, floors in white Carrara marble, Italian furniture, boxes of champagne. Nearly everything was purchased by credit card. The appeal judgment of the Court of San Marino, delivered in September 2019, has convicted a French individual residing in Switzerland, Philippe Chironi, to six years and three months imprisonment for having acted as the money launderer of the Congolese regime. The Court also ordered the confiscation of 19 million euro deposited on 36 current accounts belonging to the president’s children and relatives. None of them challenged the decision. Julienne Sassou Nguesso was among the beneficiaries of the San Marino accounts. In this case, that was concluded by a final ruling, as in the inquiry of the French prosecutors, current accounts were often not directly owned by the Congolese regime members, but by companies established in the most known tax haven jurisdictions, from Hong Kong to Mauritius, to Seychelles and Belize.

According to L’Espresso, which mentioned the French prosecutors’ investigations in its article on African Beer Investment, Hubert Pendino has managed also offshore companies that sold to Eni shares of the two Congolese oil blocks. One of the two companies is Courrat Assets Incorporated, established in Panama, the other is Zetah Kouilou Ltd, established in Bahamas. The magazine revealed that both are related to Pendino.

According to open-source reports, Pendino is linked to many other offshore companies. The ICIJ database, which is available to the public, identified him as a shareholder of Byvalle Investments Sa, a Panamanian company incorporated in 2007 and closed in 2011. The Register of companies in Panama indicates Pendino as the chairman and director of three firms that seems to be currently active: Mengo Potash Investment Inc, Kitina Mining Investment Inc, Noumbi Oil & Gas Investment Inc. The very low level of corporate transparency makes it impossible to know the shareholders’ identity, nor the activities of the three companies. However, it is certain that, in all those offshore companies Pendino works in close relations with a long-lasting collaborator within the Congolese Socofran group, the general manager David Bourion, a French man, too. In his public profile Bourion describes himself as a tax advisor with past experience at PricewaterhouseCoopers, and advisor for “several international companies, in particular in the oil and mining sector, as a part of their investments in the Republic of Congo, as well as in Gabon, Senegal, Mauritania and Tanzania.” In the three Panamanian companies chaired by Pendino, Bourion acts as a director and secretary.

ROBERTO CASULA and MARIA PADUANO

The above-mentioned affair of World Natural Resources is one of the most murky deals unveiled in Congo in recent years. According the Milan prosecutors, this deal is related to Aogc and to some people linked to Eni. The Italian prosecutors’ case is that World Natural Resources is a part of an intricate corrupt system. In order to obtain the renewal of some oil licences for Marine VI and Marine VII oil blocks by the Congolese government, Eni has allegedly donated shares in those oil blocks to Aogc, a private company belonging to Congolese public officials linked the President Sassou Nguesso. Furthermore, in line with the corrupt scheme, a part of the bribe paid to Congolese public officials and consisting of the shares in the oil blocks should be paid back, and specifically paid to people linked to Eni. “It is remarkable” - the prosecutors Paolo Storari and Sergio Spadaro wrote in the search warrant issued on 30 March 2018 - “that within the unlawful transactions we found that part of the money was being kicked back to the briber; in other words, in order to encourage the bribe giver, the bribe taker pays him benefits that may be technically defined as the price for the crime.”

At this point, World Natural Resources Limited came into play. “Unlawful agreements provided for the assignment of 23% of Marine XI licence to World Natural Resources Limited”, the prosecutors asserted. In summary, the Milan Prosecutors’ Office case is that Aogc received shares in Marine VI and VII oil blocks from Eni; at the same time Aogc transferred shares in another oil block, the Marine XI, to World Natural Resources, a group belonging to “persons linked to Eni”. In 2013, at the time of the facts at issue, World Natural Resources Congo SA, the Congolese company directly owning 23% Marine XI, has three shareholders. One is Alexander Haly, holding 25% of shares, whom we have described above. Together, Haly and Maria Paduano held 50.1% of shares through the British World Natural Resources Limited. Therefore, they were the majority shareholders. In 2018, L’Espresso, which was the first magazine to reveal that Paduano was one of shareholders of the Congolese oil block, portrayed her as follows: “Known as Marinù, she obtained a degree in law but is not registered with the Italian professional register of lawyers; she is 36, and is known only as being a curator of exhibitions in Africa and as Domenico Bellantone’s wife. Bellantone is an important ambassador, the head of secretariat of Italian vice-ministries of Foreign Affairs, whose office had been reconfirmed by the last four governments.” However, the Milanese prosecutors do not relate Paduano to Bellantone, but to Roberto Casula, the then Eni’s manager.

Casula was born in Cagliari in 1962, engineer of mines, he joined Eni just after getting his degree, reaching the highest positions in the Italian oil giant, often working closely with Descalzi around the world. Casula spent many years in Africa, he became the operation director covering the whole Sub Saharan Africa at the time of the alleged bribe paid by Eni to obtain the licence of the Nigerian Opl 245 oil block. Due to his role in the deal, the Milan Prosecutors’ Office sought a conviction to 7 year and 4 month imprisonment for international corruption in the proceedings pending at the court of Milan. In 2014, when Descalzi became CEO of the group, he appointed Casola as chief development, operations & technology officer. In short, Casula has been the deputy leader close to Descalzi for four years, until he resigned on the back of the prosecutors’ investigation on deals in Congo. He held his office in spite of corruption charges for the Opl 245 case, that directly involves also Descalzi.

What does Casula have to do with Maria Paduano, nick-named Marinù, and with the alleged corruption in Congo? In their search warrant of 30 March 2018 the Milan prosecutors highlighted two facts that relate Descalzi’s number two and the woman who was born in Reggio Calabria in 1977. The first fact was mentioned by Vincenzo Armanna, former manager at Eni in Nigeria, during the investigation on Opl 245. Armanna has actually described Paduano as a “person close to Casula”. However, the link between the shareholder of the lucky World Natural Resources and Casula resulted also from assessment carried out by the investigators on a property purchase and sale in Rome. In March 2016, Paduano signed a preliminary purchase agreement for a penthouse apartment of 200 square meters in Rome downtown, worth 1.1 million euro. But she was never the owner of the property as, in June 2017, Paduano assigned the preliminary purchase agreement to Casula, who became the sole owner of the penthouse apartment.

Three months after the deed, Paduano was hired by Eni. The company itself confirmed the fact - replying to questions from Re:Common, Global Witness and Corner House - during the shareholders meeting in 2018. “Mrs Maria Paduano was employed by Eni in September 2017 in the sustainability division, in line with her professional background, and receives the company’s average remuneration. We are not allowed to provide additional information as they are the employee’s personal data”, the company replied to its shareholders. The link between Paduano and Casula was also demonstrated by additional documents held by the Milan prosecutors. They consist of emails the public prosecutors filed in November 2019 with the Review Court. As reported by the Il Corriere della Sera, those emails reveal that WNR was owned precisely by Casula, through Paduano. On 27 November 2011 Casula wrote to a lawyer: “We granted Marinù a general power of attorney to represent us...my name will not formally appear.” Casula used the plural person “we” when referring to the power of attorney conferred to Paduano to hold WNR’s shares. Another email filed by the prosecutors is dated 21 December 2011 was sent by Paduano. She wrote to a not specified lawyer: “please, do not say that I am a front name.” The lawyer, according to the Corriere della Sera, has then confirmed to the Italian Tax Police: “Marinù told me she was just a front name (...) as requested by Casula.” On those grounds, the Milan Prosecutors’ Office has placed Casula and Paduano under investigation for international corruption. The woman is still employed at Eni, Casula, on the contrary, resigned from his office after the search carried out in 2018.

ERNEST OLUFEMI AKINMADE

He is considered the right-hand man of Dan Etete, the former Nigerian minister of petroleum, the beneficiary of the large bribe that Eni and Shell are accused, by the Milan prosecutors, of having paid for the Opl 245 oil block. Ernest Olufemi Akinmade, a Nigerian born in 1949, nicknamed Femi, also helped to build the tentacular corporate structure for the alleged purposes of handling a round of bribes in Congo. In fact, Akinmade is accused of international corruption, along with other individuals. So far, he is the only African to be under investigation, and theoretically he has nothing to do with the Republic of Congo, a country geographically and culturally distant from Nigeria. Nevertheless, from June 2014 to April 2015, Akinmade was a director of World Natural Resources Ltd, with registered office in London, a vehicle through which Maria Paduano and Alexander Haly became majority shareholders of the Congolese Marine XI oil block, holding 50.1% of shares.

With a degree in geology, at the beginning of his career Akinmade worked at the Nigerian Ministry of Petroleum close to Etete. He then joined Eni in 1971 and worked until 2006, reaching the position of NAOC executive director, one the Nigerian branches of the Italian oil giant. Subsequently we was “approached by Malabu (Etete’s company, Ed) to provide advice on matters related to OPL 245 oil block”, as he himself stated during his testimony before the Court of Milan in March 2019, during the pending proceedings for the alleged bribe of more than 1 billion dollars that Eni allegedly paid through Etete’s Malabu, seeking to obtain the OPL 245 oil block. The magazine Valori reported that Etete paid 1 million dollars, as stated by Akinmade before the Milan court. During the hearing of March 2019, the Italian judges asked Akinmade to explain few emails he sent to some Eni’s people between 2009 and 2010, before the closure of the deal. The Italian prosecutors, Fabio De Pasquale and the assistant prosecutor Sergio Spadaro often pointed out that, from the emails it appears that the Nigerian geologist was acting more as an Italian company’s advisor than Malabu’s. In one of those emails, Akinmade wrote directly to the current CEO of Eni, Claudio Descalzi. “Dear Claudio, congratulations for the results. Chief Etete confirmed that Opl 245 has been awarded 100% to Malabu. Shell is out. He is in Paris, if Eni is interested, you should act now, as also Gazprom looks to compete. I am still waiting to come to agreements with Eni, though I already provided services. I informed Ciro and Roberto on the situation. I am waiting for instructions.” When asked by the prosecutors whether he actually worked for Eni on the Opl 245 deal, Akinmade has always denied; “No, it has nothing to do with that”, he remarked on the email he sent to Descalzi “it was about a consultancy agreement on seismic matters, with which Opl has nothing to do.” His version appears to be contradicted by other messages he sent to Vincenzo Armanna, in the same period when Armanna served as a director at Eni in Nigeria. “As you know, my concern is that the vendor is annoyed. We must make sure that Etete takes us seriously”, the former Nigerian manager, wrote in another email shown by Milan prosecutors during the proceedings. The journalist Claudio Gatti wrote in his book Enigate, that Eni did not consider Akinmade as a normal counterparty in the Opl 245 deal. In his book Gatti reported a specific circumstance, “In October 2010, during a meeting with Etete in Paris, it’s Eni, and precisely Vincenzo Armanna, that paid Akinmade’s bill at the luxury Hotel Le Bristol.” Why did Eni pay the hotel accommodation for the counterparty’s purported advisor, i.e. for Etete’s Malabu? Armanna replied to Milan prosecutors as follows: “Akinmade has always maintained close ties with Eni; when he retired, he provided advisory services ...From the beginning, Eni used him to speak to Etete...From the beginning, Casula told me to speak directly with him as we trusted him. Therefore, I understood I was allowed to speak openly to Femi and even to pay his expenses in Paris.” Moreover, during Armanna’s examination by the prosecutor Fabio De Pasquale, in July 2019, Eni’s former manager said that Akinmade “managed many affairs of Descalzi’s family...he knew his wife and children”, and also “in Congo, for example, if I had decided to work with Akinmade I would have gone to Congo. Since Akinmade estimated me so much - this is what he said - in 2013 Granata proposed me to go to Congo with Akinmade, not with Eni.

Retracing the events of the Nigerian Opl 245 case helps to better understand Akinmade’s role in the deal of Marine XI in Congo. A geologist who was raised in Eni, involved in the unusual purchase and sale of the big Nigerian oil block, officially as Etete’s advisor, but suspected by prosecutors to help Eni. A key player in the Opl 245 deal, whose name is involved also in the alleged bribes in Congo. As if the two cases are somewhat connected.

Conclusion: The (lacking) sense of institutions

As reported by Il Corriere della Sera, on 10 September 2020, Milan Prosecutors’ Office asked the Judge for the preliminary investigations, Sofia Fioretta, to prohibit Eni from producing oil in Marine VI and VII in Congo, which are currently under investigation for international corruption. In subsidiary order, the Prosecutors’ Office requested that Eni be placed under special administration in the Country, as its internal organisational models did not prevent, in 2015, when Roberto Casula was the head of Sub-Saharian area, international corruption to affect the renewal of some licences, partially assigned to the local company AOGC related to Denis Gokana. Denis Gokana had been, until 2015, head of the national oil company and then the energy advisor for the President of Congo. In return for that assignment, Gokana allegedly sold 23% of another oil licence, Marine XI, to a company related to Casula. The prosecutors’ request is significant, as it confirms the robustness of the evidence gathered during the course of investigation which started in 2016 upon a complaint filed by Re:Common. The above injunction reminds us the Bonny Island case in Nigeria, when SnamProgetti, at that time a subsidiary of Eni group and later sold to Saipem, in 2016, was convicted of international corruption by final judgment in the proceedings initiated in Milan.

Justice will take its course. As in the Opl 245 case of international corruption in Nigeria, in which Eni’s CEO has been indicted, the judges will decide also on any criminal liability of the Italian company led by Descalzi for the facts we described herein. However, it is now clear that this is not just a judicial matter, but rather a broad political issue, going on since Descalzi was appointed as Eni’s CEO in 2014.

At that time, Matteo Renzi “installed” Descalzi as the CEO of the biggest and most important Italian company. In fact, the corporate governance is still heavily influenced by the State, which owns 30% of shares and actually controls all corporate bodies. The State receives rich dividends every year. The general meeting that appointed Descalzi put an end to the legacy of Paolo Scaroni leadership at Eni. The Minister of Economy, Pier Carlo Padoan, tried to set out good repute and integrity requirements for the office of top executives of the main companies controlled by the State, including the refusal of those with a criminal sentence conviction at first instance. This was the case of Scaroni, who was convicted at the beginning of 2014 for environmental disaster in Porto Tolle when he was Enel’s CEO – the conviction was then reversed on appeal and eventually time-barred by the Court of Cassation. Scaroni was set aside for reason of political expediency, but Eni shareholders’ meeting which was held in the same year rejected Padoan’s proposal to add those requirements to the Articles of Association. Hardly a small international humiliation for the Italian government.

In any case, Renzi described the appointments of Descalzi and of Emma Marcegaglia as the chairman of the company as a change of pace, even though Descalzi had a thirty-year career in Eni and had been Scaroni’s right-hand for long time. Government appointments included Prof. Luigi Zingales. Few months following the news of indictment against Descalzi on charges of corruption in Nigeria, in his bitter speech to Parliament Renzi criticised the Milan Prosecutors’ Office of being attention-seeker. A year later, after he was ostracized for shading light on the corruption issue, specifically on deals in Congo, and after not receiving any answers from Renzi, Zingales resigned from the company’s board, as he stated as a witness in the Nigeria proceedings at the court of Milan, in 2018

Since 2014, politicians have closed ranks around Eni’s CEO, who was increasingly involved in additional probes opened on operations carried out in Congo. No matter, in 2017 his term of office was extended by three years by the government led by Gentiloni. At that time, the new Italian government was politically weak and a hostage of its quarrelsome majority which made it impossible to debate about the confirmation of Descalzi’s office. In fact, such a discussion would have a waterfall effect on the appointments in the other state-controlled companies, thus generating additional conflicts and political uncertainties. As a result, in May 2020, the government led by Giuseppe Conte, “all Italians’ lawyer”, had to decide whether to confirm or to put an end to Descalzi’s kingdom. But also in this case, after gibberish talking, Descalzi’s appointment was unanimously confirmed by all political parties, including Five Stars Movement. As Renzi did in previous times, asserting a renewal in the Italy’s flagship company, Marcegaglia was replaced by the unfamiliar Luisa Calvosa. As if nothing had happened, not even the alleged conflict of interest of Eni entering multi-million-dollar contracts with companies related to the CEO’s Congolese wife. “I don’t know whether it belonged to my wife, that kind of contracts was unrelated to my managerial role”1; this is, in short, the scarcely credible defence position of a CEO that began his career in Congo, and not of a newcomer that has never been in Africa. In this circumstance, the government led by Conte, which is often blamed for overzealous pursuit of justice, did not even raise the issue of the integrity requirements necessary for the CEO position in the biggest Italian company.

Nevertheless, it would be wrong to think that it is a matter of overzealous justice or of protection of civil liberties when it comes to Eni’s top executives’ behaviour. Justice will take its course. It is a matter of political expediency and sense of the institutions that should push rulers to act in a credible way in order to avoid any misunderstandings or shadows. Actually, once again, the Italian government washed its hands of it, subject to the internal dynamics of a power system that drive the most important Italian company, something that was defined as the “parallel State”. No one of the last governments had a vision, except for the expectation of rich dividends paid every year to the Minister for the Treasury – even though, due to the current hard times for the Italian economy amid Covid, for the first time in decades Eni might not be able to pay dividends at the end of 2020.

Eni will say that its position on Congo issues has been dismissed in April 2020 by the American authorities – which are investigating on Eni, as it is listed in Wall Street as well as in Milan stock exchange. This is partially true; actually, the Department of Justice and the powerful Security and Exchange Commission have closed the investigation also because they are waiting for the Milan court’s decision. Therefore, SEC might reopen its probe when they believe it appropriate and if circumstances change; in this case, they would punish the company2. The government may reply that from 2021 Eni will implement a new sustainability governance, which will additionally improve the company’s conduct in the word. Several commentators may argue that “dead wood” have been removed – such as the former legal head Massimo Mantovani, who was involved in alleged red-herring to stop the action of Milan prosecutors on the Nigeria case, and was dismissed. The truth is that, regardless of the outcome of the several pending proceedings and investigations, a dark shadow is cast over the company’s top management and in particular over its CEO. A shadow that might threaten the credibility of the whole government and of Italy in the world.