Source: The Wall Street Journal
By DAVID GAUTHIER-VILLARS
TUNIS—Zine al-Abidine Ben Ali, Tunisia’s deposed president, goes on trial Monday on charges of abusing state funds and drug trafficking, providing the first public accounting of the practices of a ruler whose autocratic style first triggered the Arab Spring revolution that has swept the Middle East.
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Zine al-Abidine Ben Ali
Over his 23 years in power, Mr. Ben Ali—who is being tried in absentia—and his relatives amassed a fortune in banks, telecommunications firms, real-estate companies and other businesses, giving them control over as much as one-third of Tunisia’s $44 billion economy, according to anticorruption group Transparency International. The family displayed its wealth by throwing extravagant parties and jet-setting among several mansions in Tunisia and overseas.
An examination by The Wall Street Journal of Tunisian criminal court papers, as well as interviews with dozens of businessmen, Ben Ali family members and politicians, reveals fresh accusations that the Ben Ali clan—known as “The Family” here—squeezed out some business rivals by exerting political pressure to win lucrative state contracts.
Mr. Ben Ali “always acted in what he considered the Tunisian people’s best interest,” Jean-Yves Le Borgne, a French lawyer for the former president said in a statement.
The Ben Ali family “had the power and the law on their side,” says Moncef Mzabi, a Tunisian businessman who says he was forced in 2008 to sell his 3% stake in Tunisia’s largest bank to one of Mr. Ben Ali’s nephews. “A request amounted to an order,” he says.
Some Relatives of Tunisia’s President Saw Their Fortunes Rise. Marouane Mabrouk, left, controls national cellphone interests. Belhassen Trabelsi emerged as a deal-maker. Sakher El Materi bought and sold government businesses. The nephew, who is in exile in Canada, couldn’t be reached for comment. Stock-market filings show that, by late 2008, the nephew had amassed a more than 10% interest in the bank.
To stop an entrepreneur who wanted to open a new French car dealership in Tunisia, the Ben Ali government blocked some of his cars at customs for months and slapped him with 17 tax inspections, according to people familiar with the matter, including the entrepreneur, Bassem Loukil. Another businessman, Mohamed El Boussaïri Bouebdelli, says he wanted to build a new pharmacy university in Tunisia, but in a meeting at one of Mr. Ben Ali’s palaces, Mr. Ben Ali said that the proceeds should be shared “50-50” with him. Mr. Bouebdelli says he abandoned the project.
At the time he was deposed in January, Mr. Ben Ali was having a $250 million Airbus long-haul aircraft fitted out in France as an official state plane with lavish interiors, according to Tunisian government officials.
Bloody protests that broke out in Tunisia in December, after a 26-year-old street vendor immolated himself to defy Mr. Ben Ali’s regime, were the catalyst for the revolutionary wave across North Africa and the Middle East. Mr. Ben Ali’s term ended on Jan. 14 when he was hurried into a plane by his wife, according to a person present, and fled to Saudi Arabia.
Tunisia’s former president is the first deposed leader to face trial in the wake of the uprisings, but others are likely to follow. Former Egyptian President Hosni Mubarak is due to stand trial in August on charges of murder and corruption, which he denies.
Syrian Refugees in Turkish Camp Libya’s Rebels Run Out of Cash Fresh Call for Reform in Bahrain Rebels Try to Stave Off Gadhafi Forces The evidence that will be brought against Mr. Ben Ali during the trial includes stashes of cash, weapons and narcotics found at two of his mansions in Tunisia, according to officials at Tunisia’s justice ministry. In addition to abuse of state funds and drug trafficking, the former president will also face charges of illegal arms possession and illegal possession of precious artifacts, the officials said.
In his statement, Mr. Ben Ali’s lawyer in France, Mr. Le Borgne, didn’t address the specific allegations, and didn’t respond to emails seeking comment. In the statement, he said the trial is “a travesty of justice aimed only at creating a symbolic break with the past.”
Mr. Ben Ali’s trial will be presided over by judges from Tunis’s criminal courts and could take several months. Mr. Ben Ali, who remains in Saudi Arabia, won’t be present for the trial.
Tunisia’s Justice Ministry says it has sought Mr. Ben Ali’s extradition but hasn’t yet received a response. Officials in Saudi Arabia didn’t respond to requests for comment on extradition.
Officials from the Justice Ministry said Mr. Ben Ali will also face a future military trial for high treason, torture and murder, which can carry the death penalty in Tunisia, for having ordered police to shoot on protesters during the country’s recent uprisings. No date has been set for the military-court proceedings, and charges haven’t formally been brought.
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Public fury and claims of corruption helped fire street protests and a revolution in Tunisia that ousted President Zine al-Abidine Ben Ali in January and later spread to neighboring states and the Middle East.
Mr. Ben Ali is also the target of a probe in France. Last week, Paris prosecutors said they had launched an investigation into alleged money laundering by the former president and would examine whether Mr. Ben Ali owned assets in France acquired with state funds.
Before the probe was launched, Mr. Ben Ali’s lawyer said his client “owns no real estate, no money in bank accounts in France or in any other foreign country.”
The former president’s trial is part of Tunisia’s halting attempt to create a modern democracy following a month of protests. Despite the fall of their leader, many Tunisians are still taking to the streets daily to push for better job opportunities and social benefits. One Tunisian interim prime minister has already resigned in the face of popular protest.
Administrators who are freezing assets of more than 100 Ben Ali family members say they are uncovering an economic network so vast that untangling it too quickly could disrupt Tunisia further. Instead of closing down businesses owned by Mr. Ben Ali’s relatives, for example, authorities are in most cases allowing them to operate under court-appointed managers.
“No crime will be left unpunished,” Tunisia’s new interim Prime Minister Béji Caïd Essebsi said in a recent television speech. “But Tunisians must be patient.”
When he took power in 1987 through a bloodless coup, Mr. Ben Ali, a graduate of the U.S. Army Intelligence School in Fort Holabird, Md., inherited a country where the state controlled much of the economy, from agriculture to tourism and textiles. Privatization of these formerly state-controlled businesses formed the base of Mr. Ben Ali’s and his relatives’ future wealth.
Among the examples: Marouane Mabrouk, one of Mr. Ben Ali’s son-in-laws, won a public auction in 2000 to acquire a controlling stake in Le Moteur, a state company that distributes Mercedes cars in Tunisia. He also won a government license to set up Tunisia’s first broadband-cellphone network.
Mr. Mabrouk’s assets have been frozen by Tunisia’s interim authorities, pending judicial investigation into their origin. A person familiar with Mr. Mabrouk’s situation said the businessman, who still lives in Tunisia, was confident he would prove that all his investments had been lawful and that there is “no such thing as a crime of being a relative.”
The Ben Ali family expanded when the Tunisian president, who had divorced from his first wife, in 1992 married his long-time mistress Leila Trabelsi, the daughter of a shopkeeper and an employee of a Turkish bath in Tunis’s medina. Ms. Trabelsi’s 10 siblings are also considered part of “The Family.”
Soon after the nuptials, Belhassen Trabelsi, one of the first lady’s brothers, emerged as a deal-maker. In particular, Mr. Trabelsi bought acres of previously state-owned land along the Mediterranean coast and later sold property to developers, according to relatives and Tunisian government officials. With the money, he invested in hotels and launched a charter airline called Karthago.
Three years ago, Mr. Trabelsi turned to the financial world. Banque de Tunisie, one of the country’s largest private-sector companies, had made a name for itself throughout the Maghreb for its rigorous lending policy and independence from the Tunisian government.
In March 2008, the bank’s then-chairman disclosed that he was terminally ill and that he was working on a long-term strategic plan aimed at keeping the bank independent after he had passed on. Before the plan materialized, however, the bank got a sudden change in management. Alia Abdallah, wife of Mr. Ben Ali’s then-foreign-affairs minister, came to the bank’s headquarters in central Tunis and informed staff that she was the new boss, according to several executives who were there.
The bank’s board had no say, and three members who voiced their opposition were sidelined. A new board was formed, and its members included Mr. Trabelsi and two of his business associates. “They took control of the bank and there was no possible resistance,” says Ilyès Jouini, a board member who says he was pushed out.
Taoufik Baccar, head of Tunisia’s central bank at the time, says the decision to name Ms. Abdallah was Mr. Ben Ali’s. Mr. Trabelsi, who has fled to Canada where he has filed an asylum claim, couldn’t be reached. Ms. Abdallah couldn’t be reached for comment. Messages left on her husband’s cellphone and questions passed on to relatives, were unanswered.
The Ben Ali family widened again in 2004, when Nesrine Ben Ali, one of the presidential couple’s daughters, married Sakher El Materi.
Mr. El Materi, the son of a general who kept a tiger in his villa, saw his business wealth increase considerably after the nuptials. He first made money by investing in and reselling companies that were being privatized. In 2006, he used some of the proceeds to invest in the Tunisian unit of Swiss food group Nestlé SA, buying a 41% stake in the dairy company from state-controlled Banque Nationale Agricole SA for 3.6 million Tunisian dinars ($2.6 million at current rates), according to legal filings.
Nestlé says it didn’t get a say in the deal. “This transaction was conducted without our knowledge and in violation of our rights of first refusal,” said Nestlé spokesman Robin Tickle. A BNA official declined to comment. Mr. El Materi, who has left Tunisia, couldn’t be reached for comment.
About 18 months later, Mr. El Materi sold the Nestlé-Tunisie stake to Nestlé for 35 million Tunisian dinars, according to legal filings. Nestlé declined to comment on the purchase.
Since then, Mr. El Materi has founded a bank, bought a 25% stake in Tunisia’s second-largest telecom operator, started construction of a port for cruise ships, gotten elected to parliament and acquired a media group. “One may envy his status as son-in-law of the president, but no-one can denigrate him by implying that he only owes his success to his stepfather,” reads a biography of Mr. El Materi posted on his website.
In the mid-2000s, several changes were introduced in Tunisia’s constitution to allow Mr. Ben Ali to seek re-election and to grant him lifetime judicial immunity. Meanwhile, the wealth and influence of the Ben Ali family made it difficult for others do business in the country, according to a number of people who knew them.
In 2005 for example, Mr. Loukil, the car importer, began negotiating with French auto company PSA Peugeot Citroën SA to distribute cars in Tunisia. Mr. Loukil says Mr. Trabelsi wanted to join forces with him in the Citroën partnership, but Mr. Loukil refused. Shortly thereafter, Mr. Loukil says he faced 17 inspections from Tunisia’s tax authorities and his cars were blocked at customs for having 10 seats.
“There is no such thing as a ten-seat car,” Mr. Loukil said in a recent interview in Tunis.
Around the same time, Mr. Bouebdelli, head of a private foundation that runs several schools in Tunisia, went to the Carthage Palace to see Mr. Ben Ali and discuss his plans for a new pharmacy university. “Ok,” Mr. Ben Ali said, knocking on the table with the back of his hand, according to Mr. Bouebdelli. “But it’s 50-50.” Mr. Bouebdelli says he shelved the project.
Some of Mr. Ben Ali’s relatives got into trouble abroad. In 2007, a French investigating magistrate issued an international arrest warrant for Imed Trabelsi, one of Ms. Trabelsi’s nephews, on charges that he ordered the theft of a 54-foot yacht that belonged to a Lazard Frères investment banker.
Tunisia has denied the extradition to France of Mr Trabelsi, who has denied the charges. The case was dropped after Tunisian authorities returned the yacht to the banker.
“The yacht was in perfect shape,” the banker, Bruno Roger, said in an interview. “Only the dinghy was missing.”
In addition to Mr. Ben Ali’s coming trial, Tunisia’s interim government is now sifting through corruption accusations filed by Tunisians against Mr. Ben Ali and his relatives. Every weekday in central Tunis, hundreds of people queue in front of a bank building that hosts Tunisia’s special anticorruption committee. Among the recent complaints: a group of teachers claimed they had to pay bribes to get a job, and a group of shop owners claimed they had to pay commissions to get their goods through customs.
—Margaret Coker contributed to this article.
Write to David Gauthier-Villars at David.Gauthier-Villars@wsj.com