Corruption in Saudi Arabia: Why 10 Princes Arrested?

Struggle for power or anti-corruption policy? Let’s try to understand the royal relationship
09.11.2017
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On November 5, the anti-corruption committee led by Crown Prince of Saudi Arabia Mohammed bin Salman arrested 11 members of the royal family, including one of the richest people in the world, Prince al-Waleed bin Talal. They, as well as four ministers from the kingdom’s current government, are accused of bribery, extortion and money laundering. According to experts, these events are associated with great changes that are imminent in Saudi Arabia. Russiangate tells in detail what happened in the Arab state.


THE ARREST OF PRINCES AND A JAIL IN RITZ CARLTON

On Saturday, November 4, King of Saudi Arabia Salman bin Abdulaziz Al Saud decreed the creation of a powerful new anti-corruption committee. The new state body is headed by the Crown Prince of the Kingdom, Mohammed bin Salman. On Sunday, the committee ordered the arrest of about 60 influential persons, including 11 members of the royal family, ministers, military and entrepreneurs. In the press release of the committee, it was said that a number of persons “put personal interests above the public ones and stole from state funds”.

In particular, the nephew of the King of Saudi Arabia, the billionaire owner of the investment company Kingdom Holding, al-Waleed bin Talal is charged with money laundering, bribery and extortion of money from officials. According to Reuters, the dismissed head of the Ministry of the National Guard, Prince Mutaib bin Abdullah, is accused of embezzling, hiring “dead souls”, facilitating state contracts to his own companies, among which there is one for the supply of walkie-talkies and bulletproof vests worth $ 10 billion.

Former Finance Minister Ibrahim Al-Assaf, a member of the board of the national oil company Saudi Aramco, is accused of embezzlement during the expansion of the Great Mosque of Mecca. In addition, he is suspected of using official position and confidential information in the implementation of transactions with land.

The former governor of Riyadh, Prince Turki bin Abdullah, according to the authorities, also gave contracts to his own companies and abused authority in the construction of the metro.

Saud al-Mujib, Saudi Prosecutor General, reported about detailed interrogations of the detainees. According to him, a lot of evidence has already been collected. Member of the anti-corruption committee Khalid Al-Mohaysen said that the preliminary investigation that resulted in the arrests has lasted for three years because of the complexity of the task connected with the country’s influential officials.

According to The Guardian, the princes’ prison is a five-star hotel. At 11 pm, the guests of Ritz-Carlton in Riyadh were asked to come out of their rooms with all the belongings and gather in the foyer. They were seated on buses and settled in other hotels in the Saudi capital. The members of the royal family were also suspended from business. Their bank accounts were frozen, however, the bank accounts of the companies they own are operating without any interference. According to The Wall Street Journal, the government of the country intends to confiscate assets of up to $ 800 billion from the detained princes, ministers, officials and businessmen and to use these funds to cover the country's budget deficit, which was formed after the fall in oil prices.

About 60 people are currently in custody, and the authorities intend to withdraw this amount from their bank accounts, as well as to confiscate a number of assets. At the same time, according to Al Arabiya, the accounts and assets of companies belonging to the arrested will remain untouched.

WHO IS MOHAMMED BIN SALMAN?

The 82-year-old King of Saudi Arabia Salman bin Abdulaziz Al Saud, who suffered a stroke, had a spinal surgery and, as some say, suffers from Alzheimer's and dementia, appointed the 32-year-old Mohammed bin Salman as his heir, not a man of his generation. He is the eldest son of Salman's third wife, Fahda Bint Falah. In 2015, he became the youngest minister of defense in the world and the secretary general of the royal court.

In April 2016, as head of the Council for Economic and Development, he introduced the reform program called Vision-2030. The plan was designed to reduce the dependence of the country's economy on oil, the development of private sectors of the economy, including health, education, infrastructure, recreation and tourism. The program also plans to privatize a stake in the world's largest oil company Saudi Aramco. According to experts, Vision-2030 presupposes the fight against corruption, and Prince Mohammed bin Salman is considered the main reformer in the country. The International Monetary Fund called Vision-2030 an “ambitious, far-reaching task.”    

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Mohammed bin Salman. Photo: Fayez Nureldine / © AFP 2017

In 2016, King Salman’s nephew Muhammad bin Naif Abdulaziz Al Saud, that is, Muhammad’s second cousin, became the crown prince. The king changed his decision on June 21, 2017, displacing the elderly Mohammed. Presumably, the reason was the latter’s addiction to drugs. Since the end of June 2017, there have been reports in the media that Muhammad bin Naif is held in his palace under house arrest, but official representatives of the Saudi authorities deny this.

In August 2017, the Arab media reported on the assassination attempt against Mohammed bin Salman Al-Saud. Sources said that the attempt on the heir was committed by one of the Saudi princes. Mohammed bin Salman himself was not injured, and the prince, who wanted to kill him, was arrested. The media noted that the ambitious decisions of the Crown Prince, as well as his attempts to displace competitors, aroused anger and anxiety among the Saudi princes. According to experts, King of Saudi Arabia Salman may in the next five months abandon the throne in favor of the heir.

Prince Salman is popular with the young. According to him, 70% of the population of Saudi Arabia is under 30 years old, and these people want “a life in which our religion is a synonym for tolerance.” Experts note that mainly those who are dissatisfied with the Prince’s politics are clans that are pushed from power (their members are displaced from significant posts in the kingdom), as well as the conservative religious elite, in particular, through the Council of Ulema, the authority and influence of which Muhammad seeks to limit.

WHAT WILL THE ARRESTS RESULT IN?

There are several versions of what purpose the King of Saudi Arabia pursued by arresting his family members. Bloomberg reports that the monarch thus clears the way for Mohammad bin Salman. Experts also note that the series of arrests was initiated to strengthen the position of the crown prince. Analyst of the Sydney CMC Market Ric Spooner called the news from Saudi Arabia “a little disturbing” for the oil markets, but added that there are no signs of interruptions in the supply of oil. At the same time, analysts of Bloomberg note the growth of oil prices.

In early autumn, it was reported about the arrests of famous theologians and journalists who publicly expressed their disapproval of the policy of Riyadh. All this took place against the backdrop of speculation that the king could soon abdicate in favour of his son at the end of this year or early next year.

According to the version of Gulf State Analytics expert Cinzia Bianco, Mohammad bin Salman is already guaranteed to become king, so he does not need an anti-corruption campaign to get rid of other pretenders to the throne, but rather to exclude a possible split in the royal family against the planned large-scale reforms. At the same time, it is reported that strengthening the position of Mohammad bin Salman can lead to consolidation of his opponents dissatisfied with the Crown Prince's policy.

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