Saadi Gaddafi ordered by High Court to return £10m London house to Libya

A propaganda poster of the late Muammar Gaddafi, Saadi Gaddafi’s father (www.shutterstock.com)

The High Court yesterday ordered Saadi Gaddafi, the dead dictator’s 38-year-old son, to  return a £10m north London mansion to the state of Libya.

The house is held through Capitana Seas Limited, a company registered in the British Virgin Islands (BVI), as reported by the Bureau last Saturday.

But Mr Justice Popplewell said he was satisfied Gaddafi is the owner of the house because he is the sole and ultimate beneficiary of Capitana Seas. Popplewell also said he was satisfied Gaddafi used state funds to buy the house. The judge therefore ordered the house to be transferred to the state of Libya in the next three weeks. He ordered Capitana Seas pay £120,000 in costs.

The mansion, in a quiet Hampstead garden suburb, complete with indoor swimming pool and private cinema, was bought by Gaddafi just months before the start of the Arab Spring. For the house to pass to the Libyan people, HM Treasury’s Asset Freezing Unit has to give its consent.

Mohamed Shaban, the lawyer representing the state of Libya, believes this is a mere formality. He said the Treasury ‘will probably expedite this as they are so familiar with the case.’

State of Libya’s counsel Gregory Mitchell QC spent just ten minutes putting his argument to the judge. Neither Capitana Seas nor Gaddaffi were represented in court. The defence had not even acknowledged the claim issued by the Libyan legal team.

First successful asset recovery
That the Libyan people’s claim to own the house went unopposed shows Gaddaffi did not see any point in contesting the case, said Giulio Carini from anti-corruption NGO Global Witness. ‘They didn’t show up because they most likely knew they weren’t going to win,’ he said.

The court’s order will be issued in the next few days and then Capitana Seas will have two weeks to transfer the property to Libya. If they don’t, said Shaban, the court will do it for them.

Robert Palmer of Global Witness described the outcome as ‘brilliant’, adding: ‘This judgement is extremely important as it is the first successful asset recovery case brought by a country involved in the Arab Spring.’

Usually tracing assets from corrupt regimes is extremely difficult. But tracing the north London house proved relatively straightforward. It was known the house belonged to one of Gaddafi’s sons and HM Treasury’s sanctions list said Saadi Gaddafi owned Capitana Seas and therefore the house.

It has been stated that this case shows how corrupt regimes willfully treat their country’s money as their own personal slush fund. In evidence presented in court today the former CEO of the Libyan Investment Authority Rafik Nayed was quoted as saying: ‘Everything bought by the Gaddafi family was bought by Libyan oil money.’

‘If Saadi had a house, he must have had a bank account here as well: what checks did that bank do on his source of funds?’ asked Palmer. ‘The UK should also be putting pressure on the BVI and other secrecy jurisdictions to stop allowing the set-up of anonymous companies that allow corrupt politicians to hide their assets.’