Mubarak gets 3 years for embezzlement, and his sons get 4

5/21/2014

CAIRO — A criminal court here convicted former President Hosni Mubarak today of embezzling millions of dollars of public money for his personal use in private homes and palaces, in a case that rights advocates say could now implicate the current prime minister and spy chief as well.

After his conviction by the three-judge court, Mubarak, who is 86 and living in a military hospital overlooking the Nile, was sentenced to three years in prison. His sons, Gamal and Alaa, were each sentenced to four years for their roles in the embezzlement scheme. The court ordered the three to pay penalties and make repayments totaling more than $20 million, apparently in addition to $17 million they have already repaid.

The former president received a life sentence in a separate case two years ago, for directing the killing of hundreds of protesters during the uprising that ended his rule in 2011. But the presiding judge acknowledged at the time that the evidence was thin, and an appeals court threw out the conviction and ordered a retrial.

Mubarak is expected to appeal the latest verdict as well, although the evidence in this case — including more than a thousand original and forged receipts as well as the testimony of participants in the fraud — is far more substantial.

Mubarak “gave himself and his sons license to embezzle public funds, helping themselves without oversight or consideration,” Judge Osama Shaheen said in announcing the verdict today. “They deserve to be punished.”

Whether Mubarak remains in the military hospital by his own choice or under a form of detention is unclear, and there were no signs of his immediate transfer to prison today.

But the new conviction may spare the government installed last summer by the country’s defense minister, Abdel-Fattah el-Sissi, a potential embarrassment: the chance that Mubarak might walk the streets a free man again. El-Sissi led the ouster of Egypt’s first freely elected president last summer and, having resigned from the military in March to run for president, is now expected to succeed him after a pro forma election next week. Critics accuse him of returning Egypt to Mubarak-style autocracy.

El-Sissi has instead sought to portray his rise to power as an extension of the 2011 uprising and has vowed not to allow a return of the high-level corruption that flourished during Mubarak’s three decades in power.

But Mubarak’s conviction could create problems for other high-ranking Egyptians. Under the scheme, prosecutors say, public funds were diverted with the complicity of the state-run construction company, the Arab Contractors. Its chairman at the time was Ibrahim Mehlib, who is now prime minister of the government el-Sissi installed.

And a corruption investigator who built the case has filed a lawsuit alleging that his former boss — Gen. Mohamed Farid el-Tohamy, once a high-ranking corruption watchdog — suppressed the inquiry and covered up the evidence. El-Tohamy, a mentor to el-Sissi during his army career, is now the new government’s chief of general intelligence.

The court today found Mubarak and his sons guilty of embezzling more than $17 million over an eight-year period ending in 2011. In court filings, the prosecutors accused the Mubaraks of fraudulently billing the government for personal expenses — including utility bills, interior design, landscaping, home furnishings, refrigerators, other electrical appliances and even kitchen supplies — for a variety of private homes as well as a public palace that was fraudulently transferred to their ownership.

Many expenses related to five vacation homes that the family owned near the seaside resort city of Sharm el-Sheikh as well as a farm east of Cairo. The family also billed the state to design and furnish a private office for Mubarak’s wife in a luxury hotel complex and an office that the sons used to run an investment business.

Other expenses included the renovation of a villa and the installation of an elevator to the roof of one home and a Jacuzzi for another. The government paid for a new palace wing to accommodate the birth of a Mubarak granddaughter and for a mausoleum for a grandson who had died.

All the expenses were fraudulently recorded as the costs of work on a special presidential telecommunications system that is maintained by the Arab Contractors. The prosecutors named two low-level Arab Contractors employees as collaborators, and today the court declined to rule on their guilt or innocence for technical reasons.

But the initial investigation into the case also alleged that Mehlib, a close ally of the Mubaraks, knowingly approved of the diversion, according to court papers reviewed by The New York Times and described in the online publication Mada Masr. In depositions, witnesses say Mehlib supervised work on some of the personal projects, although there is no documentation showing that he knew how the work was paid for.

Mehlib left Egypt for Saudi Arabia shortly after the 2011 revolt, returning when he was named last year to the Cabinet of the military-installed government after the ouster of President Mohammed Morsi, according to news reports.

Mehlib and el-Tohamy could not be reached for comment today, and a government spokesman did not respond to messages.

The lawsuit against el-Tohamy was filed by Moatassem Fathi, a veteran investigator with the government’s Administrative Oversight Authority.

Fathi had resigned from the agency on the eve of the 2011 uprising, complaining that his supervisors were thwarting his work. After Mubarak’s ouster, Fathi sued to win his job back, and he ultimately gathered the evidence for the Mubarak corruption case.

After Morsi was elected in 2012, he fired el-Tohamy, and prosecutors initiated an inquiry against him.

But two days after Morsi was ousted last summer, the new government brought back el-Tohamy in the more senior position of head of general intelligence, Egypt’s spy chief.

Fathi’s complaint was all but forgotten, and he was soon demoted. He was recently transferred again to a desk job at the legal affairs department of the Ministry of Trade.

“The political environment under Mr. Mubarak was tough because there was no real political will to seriously go after corrupt officials,” Fathi told Mada Masr. “I thought all of this would change with Mubarak’s ouster, but the revolution was not given a chance to govern.”