Saudis Said to Use Coercion and Abuse to Seize Billions
Businessmen once considered giants of the Saudi economy now wear ankle bracelets that track their movements. Princes who led military forces and appeared in glossy magazines are monitored by guards they do not command. Families who flew on private jets cannot gain access to their bank accounts. Even wives and children have been forbidden to travel.
In November, the Saudi government locked up hundreds of influential businessmen — many of them members of the royal family — in the Riyadh Ritz-Carlton in what it called an anti-corruption campaign.
Most have since been released but they are hardly free. Instead, this large sector of Saudi Arabia’s movers and shakers are living in fear and uncertainty.
During months of captivity, many were subject to coercion and physical abuse, witnesses said. In the early days of the crackdown, at least 17 detainees were hospitalized for physical abuse and one later died in custody with a neck that appeared twisted, a badly swollen body and other signs of abuse, according to a person who saw the body.
In an email to The New York Times on Sunday, the government denied accusations of physical abuse as “absolutely untrue.”
To leave the Ritz, many of the detainees not only surrendered huge sums of money, but also signed over to the government control of precious real estate and shares of their companies — all outside any clear legal process.
The government has yet to actually seize many of the assets, leaving the former detainees and their families in limbo.
One former detainee, forced to wear a tracking device, has sunk into depression as his business collapses. “We signed away everything,” a relative of his said. “Even the house I am in, I am not sure if it is still mine.”
As the architect of the crackdown, Crown Prince Mohammed bin Salman, prepares to travel to the United States this month to court American investment, Saudi officials are spotlighting his reforms: his promise to let women drive, his plans to expand entertainment opportunities and his moves to encourage foreign investment. They have denied any allegations of abuse and have portrayed the Ritz episode as an orderly legal process that has wound down.
But extensive interviews with Saudi officials, members of the royal family, and relatives, advisers and associates of the detainees revealed a murkier, coercive operation, marked by cases of physical abuse, which transferred billions of dollars in private wealth to the crown prince’s control.
Corruption has long been endemic in Saudi Arabia, and many of the detainees were widely assumed to have stolen from state coffers. But the government, citing privacy laws, has refused to specify the charges against individuals and, even after they were released, to clarify who was found guilty or innocent, making it impossible to know how much the process was driven by personal score settling.
Part of the campaign appears to be driven by a family feud, as Crown Prince Mohammed presses the children of King Abdullah, the monarch who died in 2015, to give back billions of dollars that they consider their inheritance, according to three associates of the Abdullah family.
And although the government said the campaign would increase transparency, it has been conducted in secret, with transactions carried out in ways that avoid public disclosure, and with travel bans and fear of reprisals preventing detainees from speaking freely.
Most people interviewed for this article spoke on the condition of anonymity to avoid the risk of appearing to criticize Crown Prince Mohammed.
The government said in its email that “the investigations, led by the Attorney General, were conducted in full accordance to Saudi laws. All those under investigation had full access to legal counsel in addition to medical care to address pre-existing, chronic conditions.”
The government, and several Saudi officials contacted separately, declined to answer further questions about the crackdown.
They have argued, however, that it was a necessarily harsh means of returning ill-gotten gains to the treasury while sending a clear message that the old, corrupt ways of doing business are over. And they have defended the process as a kind of Saudi-style plea bargain in which settlements were reached to avoid the time and economic disruption of a drawn-out legal process.
In a separate statement on Sunday announcing new anti-corruption departments in the Attorney General’s office, the government said that King Salman and Crown Prince Mohammed “are keen to eradicate corruption with utmost force and transparency.”
But the opaque and extralegal nature of the campaign has rattled the very foreign investors the prince is now trying to woo.
“At the start of the crackdown they promised transparency, but they did not deliver it,” said Robert Jordan, who served as American ambassador to Saudi Arabia under President George W. Bush. “Without any kind of transparency or rule of law, it makes investors nervous that their investments might be taken and that their Saudi partners might be detained without any rationale to the charges.”
A Five-Star Jail
Before dawn on Nov. 4, Prince Alwaleed bin Talal, the kingdom’s most famous investor and one of the world’s richest men, was asleep at a desert camp where he repairs to relish the simple life when he was summoned by the royal court to see King Salman, according to two associates of his family. It was a strange request for that hour, but one does not ignore the king’s wishes, so he returned to Riyadh, where his guards were dismissed, his phones taken from him and he was locked in the Ritz.
Over the next 24 hours, similar calls lured in more than 200 people, including some of the kingdom’s wealthiest and most powerful men. They included Prince Mutaib bin Abdullah, a son of King Abdullah and head of one of the country’s three main security services; Fawaz Alhokair, who owned the kingdom’s franchises of Zara, the Gap and dozens of other stores; Salah Kamel, an elderly businessman from the Red Sea port city of Jidda; and many other princes, businessmen and former government officials.
Most ended up in the Ritz, in rooms whose glass shower doors and curtain rods had been removed to prevent suicide attempts. They could watch television and order room service, but had no internet or phones.
Outside, their relatives panicked, and managers of their far-flung businesses drew up contingency plans to keep operations running, unsure of how long their bosses would be gone.
Eventually, the detainees were allowed to reassure their families through short, monitored calls.
Many were prevented from contacting their lawyers, but Prince Alwaleed spoke weekly with some of his managers, his associates said. He remained out of public sight until January, when the royal court allowed a journalist from Reuters to interview him in the Ritz to counter a BBC report that he was being kept in a cell-like room.
“Rest assured that this is a clean operation that we have,” the prince told Reuters, having visibly lost weight and grown a beard. “There is a misunderstanding and it is being cleared.”
The video stuck many who knew the prince as strange.
“It looked artificial in many ways,” said Mr. Jordan, the former ambassador, who has met the prince many times, most recently last April.
Within a few hours, he was released, but even close associates say they do not know what agreement he made with the government.
Turki Shabanah, the chief executive of a television network owned by Prince Alwaleed, said that he had spoken with the prince by phone several times while he was detained and had seen him frequently since.
He said he had “no idea” if the prince had reached any kind of settlement with the government, but he endorsed the crackdown on corruption as long overdue.
“The way it was was not normal, not for Saudi investors nor for foreign investors,” he said. “The system needed that shock to clear the past and start a new future.”
Representatives of Prince Alwaleed’s company, Kingdom Holding, declined to make him available for an interview, but two associates of his family said he is under armed guard. He has told very few people, if anyone, what happened to him in the Ritz.
“It is something he wants to forget,” one associate said.
Reports of Abuse
In the early days of the Ritz detentions, as many as 17 detainees required medical treatment for abuse by their captors, according to a doctor and an American official.
Relatives of some of the detainees said they were deprived of sleep, roughed up and interrogated with their heads covered while the government pressured them to sign over large assets.
Evidence of such abuse has been slow to emerge, but officials from two Western governments said they deemed the reports credible.
One case involved a Saudi military officer who died in custody. One person who saw the corpse of the officer, Maj. Gen. Ali al-Qahtani, said that his neck was twisted unnaturally as though it had been broken, and that his body was badly bruised and distended. His skin showed other signs of physical abuse, the person said.
A doctor and two other people briefed on the condition of the body said that it had burn marks that appeared to be from electric shocks.
In the emailed response to questions about General Qahtani, an official of the Saudi Embassy in Washington said, “All allegations of abuse and torture of those investigated during the anti-corruption proceedings are absolutely untrue.”
The official added that the detainees had “full access” to legal counsel and medical care.
General Qahtani, an officer in the Saudi National Guard who was believed to be about 60, was not wealthy himself, so his value as a major anti-corruption target is questionable. But he was a top aide to Prince Turki bin Abdullah, a son of the late King Abdullah and a former governor of Riyadh, and the interrogators may have been pressing the general for information about his boss, Prince Turki. The members of King Abdullah’s family are seen as rivals of Crown Prince Mohammed and his father, King Salman.