Maldives: Government Ministers Were Investigated For Money Laundering, Counterfeiting

An investigation was launched in 2007 into high-ranking government figures suspected of financial crimes including money-laundering and counterfeit currency, a source formerly close to the President has revealed to Minivan News.

The probe, allegedly initiated by our source with the President’s approval and using government funds, was terminated shortly after it had begun because the source “was not receiving support” for the project and feared “a fate worse than dismissal” if evidence was found against those targeted.

Project Dodo

The top secret investigation, known as “Project Dodo” or “Project Factory”, had a particular focus on counterfeit currency.

It was triggered by a perceived lack of action following the discovery in March 2006 of over Rf 1,000,000 in a safe belonging to the state-run Maldives Industrial Fisheries Company (MIFCO).

Two MIFCO employees were arrested over the discovery, including the man who had reported the find to the authorities. But the origins of the counterfeit currency were never discovered.

Our source said it was incidents such as this which led him to believe certain individuals, then government ministers, were themselves involved in financial crime. These individuals had “links to MIFCO” and “lots of money for no good reason”, according to the source.

Because of this, very few even within the Maldivian government were aware of “Project Dodo”.

But presidential spokesman Mohamed Hussein Shareef (Mundhu) has confirmed he knew of the project, as has then Attorney General Hassan Saeed, now a leader of the opposition New Maldives Movement.

The project was initiated at the time of the Maldives’ accession to the United Nations Convention Against Corruption in March 2007.

It also encompassed embezzlement, the source says, with US $200 million suspected to have been siphoned from state funds by one individual.

But despite initial meetings with the president and counterfeit notes being passed to the security company for investigation, the project had come to a halt by May 2007, our source says.

Hill & Knowlton

According to documents seen by Minivan News, the investigation was conducted through a British security company specialising in financial crime, which came recommended by the UK public relations firm Hill & Knowlton.

Hill & Knowlton carried out public relations for the Maldivian government from late 2003 until early 2007.

Tim Fallon, who managed the Maldives account at Hill & Knowlton until it was frozen in 2007, said: “Legal and contractual obligations mean that I am not able to comment on the detail of the relationship [with the Maldives].”

But he did not deny the existence of the project, or that the security company were paid through Hill & Knowlton.

“Counterfeiting Is Political”

Documents seen by Minivan News indicate the suspicions which prompted the inquiry related to a “printing plant in Delhi, Colombo or Thailand”.

They confirm that the investigation was targeted towards specific individuals, who were also thought to have “links” with the “anti-corruption office”, presumably a reference to the Anti-Corruption Board.

But our source said he was unable to take the investigation further than the exploratory stage, because he “lacked support” and a “mandate” to carry out a probe which might “reel in some big fish”.

Asked for his thoughts on financial crime in the Maldives, former foreign minister Dr Ahmed Shaheed, who resigned last August, said that “counterfeiting is political” in the country.

“Fake notes will be used to buy votes” in the presidential election, Shaheed believes. And he adds that anecdotal evidence indicates this has happened in the past.

Extension of Rf500 Note

New Rf500 notes were issued in 2006 with “upgraded security features” to prevent forgery, according to the Maldives Monetary Authority (MMA).

But on 11 December the President’s office announced the validity of the old notes would be extended until 28th December 2008. They were originally due to expire in 2007.

Our source alleges the extension was to enable the continuing use of forged notes through this year’s presidential election.

However Abdul Ghafoor Abdul Latheef, Senior Executive Director at the MMA, says the notes were extended to allow Maldivians living abroad or on remote islands more time to exchange the old notes for new ones.

Ghafoor says the “president’s involvement was minimal” in the decision. But the president’s office said at the time that “the president has extended the deadline”.

Accusations of Corruption

Opposition politicians and campaigners have long accused the Maldivian government of corruption, with the Anti-Corruption Board itself under fire in November for refusing to reveal details of cases it had investigated to parliamentary scrutiny.

MIFCO has also faced a number of high-profile corruption accusations, as well as a war of words with the MMA in 2006 over who should take the blame for the counterfeit notes discovered in MIFCO’s possession.

But such accusations have rarely resulted in concrete action.

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