Saudi billionaire linked to passport deal in 1990s dies

 

HE WAS a billionaire Saudi banker who spent much of the last decade suing anyone who dared air allegations that he had funnelled money to al-Qaeda, but Khalid bin Mahfouz, who died last month, is best known in Ireland for the Irish passports he received, apparently over lunch at the Shelbourne Hotel, in 1990 as part of the infamous passports-for-investment scheme.

Eleven Irish passports were granted to Mahfouz, his family and friends in exchange for a promised investment of £20 million. Then minister for justice Ray Burke personally authorised the naturalisation certificates at his Co Dublin home instead of delegating the matter to a senior official as was standard practice.

An inquiry found that statutory procedures were breached in several instances, including the fact the passports were handed over before the necessary naturalisation procedures were completed; and the requirement that applicants swear an oath of fidelity to the State was waived.

Mahfouz died at his home in the Red Sea city of Jeddah in late August. According to reports in the Arab media, the cause of death was a heart attack. He was 60.

His passing marked the end of an often controversial life. Last year, Arabian Businessmagazine ranked him 24th in its list of the 50 wealthiest Arabs, with a fortune estimated at $3.35 billion.

Heir to Saudi Arabia’s largest financial institution, the National Commercial Bank, Mahfouz later became embroiled in the Bank of Credit and Commerce International financial scandal in the early 1990s. He paid $225 million to settle charges of fraud relating to the bank’s collapse.

Following the attacks of September 11th, 2001, several individuals and organisations, particularly charities, in Saudi Arabia came under scrutiny as investigators attempted to unpick al-Qaeda’s funding streams.

Mahfouz, with his connections to the family of Osama bin Laden, and significant donations to Islamic charities, found his name popping up in reports and books dealing with the subject. He was often erroneously described as bin Laden’s brother-in-law.

A close friend of bin Laden’s eldest brother Salem, Mahfouz admitted that in 1988 Salem asked him to fund the jihad against the Soviets in Afghanistan. “In line with many other prominent Saudi Arabians and in accordance with US government foreign policy at that time, Khalid recalls making a donation of approximately $270,000,” says a statement on a website set up to refute claims he had sponsored terrorism.

A month after 9/11 Khalid bin Mahfouz’s name came up in the Dáil, with Opposition TDs referring to media allegations relating to the financing of al- Qaeda. Then minister for foreign affairs Brian Cowen confirmed the Mahfouz family passports had expired in 2000, and that the question of revoking them had not arisen.

Some commentators described Sheikh Mahfouz as a “libel tourist” due to his enthusiastic use of Britain’s libel laws to sue publishers who ran accusations that he had financed terrorism. All his legal actions proved successful.