Contentious matters involving wealthy Saudis are, typically, handled with discretion, and the arrests generated shocked headlines around the world. But Salman’s sweep may have been foreshadowed two weeks ago, when Maan al-Sanea, a raffish Kuwaiti billionaire, was arrested at his home on the eastern coast of Saudi Arabia.
Two years ago, I wrote about Sanea and a feud he was having with his in-laws, the Gosaibis, for The New Yorker. The saga began in 2009, when the Gosaibis, a tremendously wealthy Saudi family, fell on hard times. The family owned a multibillion-dollar empire of hotels, real estate, and financial services—plus a Pepsi bottling-and-distribution center. But that May one of the banks owned by the family collapsed.
An exceedingly messy affair ensued. The head of the Gosaibi family accused Sanea of opening the bank—which was called the International Banking Corporation, or T.I.B.C.—without his consent, and of systematically defrauding the family and the bank’s customers. Corporate investigators subsequently uncovered what they believed was evidence of a scheme involving forged signatures and the issuing of fake loans. Lawyers for Sanea claimed in court that the Gosaibis knew what he was doing all along, but they never explained the signatures or loans the investigators had raised questions about.
The financial complexities of the case were daunting—in part because of the opacity of the Saudi legal system. The dispute between the Gosaibis and Sanea played out in separate lawsuits in the Cayman Islands, Switzerland, Bahrain, the U.A.E., and other legal jurisdictions around the world. Yet only one jurisdiction, Sanea’s lawyers claimed, truly mattered. “Our client’s position has always been that the substantive dispute between him and the al-Gosaibi family can be dealt with properly in Saudi Arabia,” they said.
Sanea lived in a beachfront palace near the city of Khobar. He was well connected with the senior-most officials in the country’s Eastern Province, and he lived in splendor. On the grounds of his compound, he had his own zoo, which included lion cubs and flamingos; in one court filing, he estimated the value of his “safari animals” at between thirteen million and twenty-three million dollars. Some years ago, one of his lawyers said that Sanea’s utility bills ran to about eight hundred thousand dollars per month. In his private harbor, he kept multiple yachts docked.
In mid-October of this year, a police squad was dispatched to the palace. According to reports, Salman personally approved the raid. When the police arrived, they could not find Sanea at first. “A palace so big, you will get tired walking in it,” one officer observed, in a lengthy text message posted on social media. Several hours after arriving, an officer spotted a ladder leaning against a boathouse. Climbing up, he discovered a “secret room” full of security monitors.
Sanea was inside; he had been watching the raid unfold. Officers arrested him and took him away. An official statement posted on Twitter by the Eastern Province’s local government said that authorities there were determined to “eliminate all kinds of corruption” and hold accountable “proven accomplices of any violations of the law.” HuffPost Arabic quoted one Saudi who proclaimed on Twitter, “Welcome to our new Saudi Arabia.”
Sanea did not work alone at T.I.B.C. An American named Glenn Stewart was the bank’s C.E.O. As one former colleague explained it to me, Sanea was the field marshal, and Stewart was his “main general.” At the time of T.I.B.C.’s collapse, Stewart was living in Bahrain—he was prohibited, by local authorities, from leaving the island nation. One night in 2010, he escaped aboard a thirty-four-foot cabin cruiser, made it to Iraq, flew to Jordan, then London, and finally home, to Los Angeles.
As I was reporting my magazine piece, I interviewed Stewart several times. He repeatedly denied any wrongdoing and claimed that he had been “tricked, big time” by Sanea. He told me that he’d learned a valuable lesson from the whole mess: “Never do business with princes or kings.”
Stewart is a brash, overbearing man. He once crashed a Bahrain Association of Banks event at the Mandarin Oriental, in Washington, D.C., in order to confront the governor of Bahrain’s central bank. “I wanted to assert my rights as a free man, not one of their semi-slaves,” Stewart told me.
He pulled a similar stunt this July, when he showed up at the law offices of K&L Gates LLP, in London. The firm, which represents the Gosaibis, was hosting a discussion about banking in the Middle East. Toward the end of the talk, the moderators solicited questions from the audience. Stewart stood up. (He was, according to one attendee, wearing a name badge that identified his affiliation as Penn Associates or Penn Advisers.) Stewart accused the Gosaibis of lying about what they knew in an attempt to cover their own liabilities, and then he plugged a forthcoming movie being made about his life, based on an “unpublished autobiography” he’d written titled “Never Do Business with Princes or Kings.” The working title of the film was the same as a line that this magazine used to promote my article, in 2015: “A Billion-Dollar Mirage.”
Two weeks ago, I called Stewart. We’d not spoken since the publication of my story. “What do you want?” he said, upon hearing my voice.
I asked if he’d heard about Sanea’s arrest. “Of course,” he said. “They’ve thrown him in equivalent of debtors’ prison for domestic obligations that he’s got to either banks or salaries unpaid.” (In late October, Dwight Wolczak, a former employee at a hospital owned by Sanea told me, by e-mail, “I am one of hundreds of former Saad Specialist Hospital employees hoping to win our case against him for 12 months back pay.”) The arrest had nothing to do with anything that transpired at T.I.B.C., Stewart believed. Speaking before Salman had rounded up his fellow-princes in the Ritz, Stewart told me that Sanea’s apprehension was evidence of changes in the power structure inside Saudi Arabia: “He’s lost whatever political protection he had.”
Before he hung up on me, I inquired about the event he’d attended in London. Was Penn Associates a new company of his? “It’s nothing to do with anything to do with you,” he replied.
“Is it a real thing, or a fake thing that you put on the badge?” I asked. (Stewart subsequently said that the company is real.)
“This conversation is over,” he said.
source – The New Yorker