The Justice Department is looking into a number of Wall Street banks’ relationships with Libya after the country’s sovereign wealth fund announced that it was suing Goldman Sachs last week, says the WSJ.
Credit Suisse, J.P. Morgan, Société Générale, Blackstone Group BX and hedge fund Och-Ziff Capital Management Group are all being probed for allegedly hiring “fixers”to make key connections to the Gaddafi regime.
Specifically, the DOJ wants to know if these middle men facilitated bribes that financial firms then paid to Libyan politicians in exchange for business deals. That is a violation of the Foreign Corrupt Practices Act.
Some fixers had direct ties to two of Gaddafi’s sons, sources allege.
None of the companies being investigated have been accused of wrongdoing.
“Libya was fragile — one could feel it,” said Gary Garrabrant, the former chief executive of Equity International, a Chicago-based real-estate investment trust founded by Sam Zell. Equity International considered deals in Libya, including the InterContinental project, according to Mr. Garrabrant.
“There was a layer that existed in Libya of people that in effect controlled access,” he said. “They were door openers.”