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According to the Collins English Dictionary 10th Edition fraud can be defined as: "deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage".[1] In the broadest sense, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation. Defrauding people or entities of money or valuables is a common purpose of fraud, but there have also been fraudulent "discoveries", e.g. in science, to gain prestige rather than immediate monetary gain
*As defined in Wikipedia

Thursday, March 3, 2011

Goldman Sachs's Tentacles in Libya

We should not be surprised that Goldman Sachs jumped at the opportunity to "invest" in Libya once George Bush welcomed Gaddhafi back into the fold of the world community. Recently, President Obama announced that he was freezing the Gaddhafi family's assets. The Libyan Asset Authority invested "hundreds of millions of dollars in Goldman Sachs Asset Management funds, including a loan fund designed to invest in new hedge funds set up by the Kuwait Investment Authority." Everyone likes the opportunity to earn big bucks with Goldman Sachs.

Libya's Billions Invested In U.S. Private Equity, Big Banks
by Marcus Baram - The Huffington Post

NEW YORK -- U.S. President Barack Obama's executive order freezing $30 billion in assets of Muammar Gaddafi, his family and the Libyan government could impact several U.S. banks and private equity firms, including Goldman Sachs, Citigroup, JPMorgan Chase and the Carlyle Group. The Obama administration described it as the largest seizure of foreign funds in U.S. history.

The oil-rich country's sovereign wealth fund, the Libyan Investment Authority, controls at least $70 billion in fixed assets and reserves. It has invested the bulk of its money in European banks and businesses, including Dutch-Belgian bank Fortis, Italian bank Unicredit, the Pearson publishing empire, Italian defense firm Finmeccanica SpA, an oil-production sharing agreement with BP and even a slice of the Italian soccer team Juventus.

In the wake of the Bush administration's lifting of sanctions against Libya in 2004, following Gaddafi's agreement to give up weapons of mass destruction, American businesses and private equity firms also came flocking to the North African country to court government and LIA officials. As The Huffington Post reported last week, a broad coalition of U.S. oil companies, defense manufacturers and businesses lobbied the U.S. government to repair relations with the longtime international pariah and to take advantage of business opportunities in the country.

The secretive Libyan Investment Authority has reportedly invested hundreds of millions of dollars in Goldman Sachs Asset Management funds, including a loan fund designed to invest in new hedge funds set up by the Kuwait Investment Authority. Goldman Sachs already has a relationship with Libya -- in 2008, Goldman was the first U.S. bank to get a contract with the country following the removal of sanctions, when it was hired by Libya's central bank to provide information on its behalf to credit rating agencies. A spokesperson for Goldman Sachs did not return calls seeking comment.

The Libyan government, including LIA, has also banked with Citigroup, according to several sources familiar with the matter. A spokesperson for Citigroup declined to comment on the bank's interactions with the Treasury Department's Office of Foreign Assets Control, which is in charge of carrying out Obama's order regarding Libyan assets.

JPMorgan Chase reportedly handles much of the LIA's cash and some of the Libyan central bank's reserves. The summer after then-Secretary of State Condoleezza Rice visited Gaddafi in 2008, LIA gave "mandates to some of the international banks, including JPMorgan to manage their funds in the interbank money markets, according to Vanity Fair.

The LIA fund's general consultant has been Mercer Investment Consulting, a unit of Marsh & McClennan, the global risk consulting and advisory firm. A spokesperson for Marsh declined comment. The fund set up a $2 billion investment fund with the Qatar Investment Authority to invest in Libya, Qatar and Western markets, which could complicate the effort to freeze the LIA's assets.

Read the full story here


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