Private Empire: ExxonMobil and American Power (71 page)

Teodorin moved in and out of the United States on an A-1 diplomatic visa, often carrying more than $1 million in cash, which he routinely failed to declare to U.S. customs officers as required by law, according to the I.C.E. investigators. Los Angeles and New York were among his favored destinations; at one stage, Teodorin set up a record company in Los Angeles specializing in rap and hip-hop music, and for a while he traveled in the company of the glamorous rapper Eve. His spending and his migration into the hip-hop business suggested an air of danger and urban sophistication, but in person he could just as often come across as unworldly.

“He showed up in my office with his entourage—four or five people,” all from Equatorial Guinea, recalled an attorney in Los Angeles who worked with him. “His English wasn’t very good; he had other people who would do the language for him. He was willing to pay whatever was required. He would ask, ‘How much do you want?’ And the check was right there.”
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Teodorin could be enthusiastic about laying out money for a new purchase or project, but his managerial follow-up was often lacking. Unpaid bills and civil lawsuits accumulated in Los Angeles County civil courts. Teodorin relied on American lawyers, real estate agents, personal assistants, bankers, bodyguards, and freelance fixers and hangers-on to manage his bills and his chaotic consumer habits. His American advisers took note that the luxury automobiles abandoned in Teodorin’s California garage would by themselves finance a respectable hospital back home. It was not unusual for Teodorin to lose track of his cars; in one case, he asked an adviser to fly across the country to Los Angeles to move one of them from a parking garage where he had absentmindedly abandoned it. Former assistants filed lawsuits in Santa Monica civil court alleging that Teodorin failed to pay overtime as required by California law; the defendant often missed court appearances and depositions.
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After the failed coup attempt led by Simon Mann, Teodorin turned up at the Beverly Wilshire Hotel to do some house hunting. Through one of his Los Angeles attorneys, he summoned a Hollywood Hills real estate agent, Neal Baddin, to his suite. Baddin thought Teodorin seemed “bigger than life.” Baddin agreed to serve as his real estate agent, and over the next seventeen months, he helped negotiate the purchase of a $30 million Mediterranean estate on a fifty-foot bluff overlooking the Pacific Ocean, in Malibu. Teodorin’s neighbors in the gated community included James Cameron, the director of
Titanic
and
Avatar,
and the comedian Dick Van Dyke.

As the purchase closed, one of Teodorin’s Los Angeles attorneys contacted Paul Finestone of the Finestone Insurance Agency, seeking to buy a policy for the Malibu estate and thirty-two cars that would be housed there. The attorney explained that a number of American insurance companies had so far refused to sell Teodorin insurance; he asked Finestone to find a company willing to do business with the Obiang family.

When one insurer asked why Teodorin intended to employ armed security guards at his Malibu home, Finestone explained that his client was an “investor and collector” who was “independently wealthy” and needed guards to protect against kidnapping.

American International Group, Inc., which would gain notoriety for its role in the 2008 global financial crisis, refused to sell to Teodorin after learning about his background. Finestone wrote to A.I.G. to challenge the insurer’s decision. Equatorial Guinea, he wrote, “is a major supplier of oil to America and a critical interest of American energy needs.” President Obiang, Teodorin’s father, “is no better and no worse than the Saudi Royal family. . . . We insure billions and billions of dollars of Saudi property bought with our oil money here in America and A.I.G. has no problem handling a great deal of that business.”
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America’s oil dependency required even Los Angeles insurance brokers to consider the relative virtues of corrupted oil alliances.

S
everal weeks after President Obama’s inauguration, the United States received intelligence reporting from Nigeria that some sort of an attack was being planned on high-level targets in Equatorial Guinea. Such reports were increasingly common. Piracy, oil smuggling, and speedboat militancy carried out mainly by armed Nigerians under the brand name of the Movement for the Emancipation of the Niger Delta (M.E.N.D.) continued to spread throughout the Gulf of Guinea.

That winter, ExxonMobil’s West African operations were on particularly high alert. In December, in Nigeria’s Akwa Ibom State, armed gangs had shot up an ExxonMobil caravan, apparently seeking to kidnap expatriate workers; Nigerian security guards returned fire and repelled the attackers. A month later, the guards were in action again, around the same housing compound in Eket where the traumatic kidnapping of 2006 had occurred; again, the ExxonMobil security force managed to ward off the assailants before they could reach any oil workers. Militants in speedboats also attacked an ExxonMobil oil platform in the ocean waters off Akwa Ibom. Malabo and its harbor lay only eighty-five miles by boat from Eket, straight across the Bight of Biafra—for speedboat-equipped militants and robbers, it was an easy commute.

In Equatorial Guinea, ExxonMobil, Marathon, and Hess had developed an e-mail system to distribute warnings about impending coups, invasions, or waterborne bank robberies in which armed men in speedboats arrived at Equatorial Guinea’s coastal cities to hold up banks and escape by sea. The oil companies’ security departments tended toward caution and often ordered lockdowns at their Malabo and mainland compounds on receipt of even fragmentary intelligence reports.

The United States continually earned credit with President Obiang—and partially compensated for the harping it made Obiang endure about human rights—by sharing warnings about invasions or coups. Typically, Obiang reacted to the warnings by erecting checkpoints around the capital, detaining foreigners, and otherwise tightening his already-heavy police deployments. These visible precautions taken after American intelligence warnings likely prevented some of the threatened attacks from going forward as planned. There was a boy-who-cried-wolf problem inherent in the repeated warnings and preemptions, however, particularly because there had been no serious coup-making attack on Obiang, beyond the plotting stage, in several years.

In the darkness of February 17, 2009, speedboats bearing armed men arrived in Malabo. Three boats entered the harbor; three others arrived on the eastern side of an adjoining peninsula. The attackers disembarked, unopposed, and headed toward the presidential palace, where, as it happened, the president was not home. (When Washington passed on its latest round of attack or coup warnings, President Obiang had quietly slipped out of Malabo to his better-fortified palace on the African mainland.) The Israeli trainers had planned for this moment—their Equato-Guinean charges were supposed to swarm in and counterattack to protect the palace and repel the invaders. In the event, the response was more ad hoc than the Israelis would have hoped. Senior ministers and generals who were supposed to lead the counterattack failed to turn up when the shooting started. Several younger officers did respond, however, and they fired vigorously, killing at least one raider, arresting others, and, after a two-hour gun battle, chasing the remainder of the group back to sea in their speedboats.

One of the younger Equato-Guineans who defended the presidential palace that night took a bullet in the hand. A few days later, as calm returned, President Obiang celebrated the soldier in public as a national hero. Obiang appointed a businessman to accompany the wounded hero to New York, to seek out the finest American surgeons available to repair the soldier’s hand. Lacking American health insurance cards, Obiang provided the soldier’s businessman escort with $125,000 in cash to pay for medical expenses. At John F. Kennedy International Airport in New York, however, U.S. Customs officers discovered the cash in the businessman’s luggage. The money had not been properly declared, and the businessman was arrested on money-laundering charges. After some confusion and delay, the case was eventually cleared up.

The raiders, it turned out, had been Nigerian militants who had ties to a section of Obiang’s exiled political opposition in Spain, and who had been trying to sell protection services to sections of Equatorial Guinea’s government. The militants did not feel that their offer of protection was being taken seriously enough, so they had decided to mount a demonstration project in Malabo, to show that their services were indeed required if ExxonMobil and the other oil companies wanted to operate in security. What the attackers might have done if they had penetrated the presidential palace and found Obiang at home was not clear.
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B
arack Obama’s pronouncements about foreign policy during the 2008 election campaign suggested that he was prepared to rethink the Bush administration’s approach to governments that were hostile to the United States or that did not conform to American ideals about democracy and human rights. The Obama administration seemed to be signaling that it sought “dialogue and engagement,” as an ExxonMobil executive put it after the president’s inauguration. “They are saying that about Russia, they are saying that about China, they are saying that about Iran. . . . That is the cornerstone of their foreign policy.”
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Why not Equatorial Guinea, too? That was the basic question that Anton Smith had presented in the six analytical cables he filed from Malabo during the late winter and spring of 2009, hoping to redirect Obama administration policy toward deeper engagement.

Secretary of State Hillary Clinton’s advisers included some energy “realists” such as those who had shaped her husband’s second-term policies aimed at securing oil supplies from Central Asia. Clinton named as a special energy policy envoy David Goldwyn, who, before joining State, had organized a business group designed to support Libyan leader Muammar Gaddafi’s plans to reopen the Libyan oil business to international corporations—among them, ExxonMobil. To run Africa policy, Clinton named Johnnie Carson, a longtime foreign service officer who had served as U.S. ambassador to Kenya, Uganda, and Zimbabwe before his appointment by President Bush as national intelligence officer for Africa. Between Goldwyn’s background as an oil industry consultant and Carson’s deep experience of engagement with flawed African governments, Anton Smith’s arguments about Equatorial Guinea found at least some influential readers inclined to his views.

The human rights community saw an opportunity to mark a new course, too, but in a very different direction: “The new Obama administration has an opportunity to show that energy security does not have to come at the expense of human rights and good governance,” Human Rights Watch argued in a major report about Equatorial Guinea released that July. It recommended investigations to seize and repatriate to Equato-Guinean citizens’ assets in the United States “obtained through corruption,” and it recommended that Obama “ensure through new or existing laws and regulations that U.S. companies do not become complicit in the corruption and abuses that mar resource-rich countries like Equatorial Guinea.”
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The formulation suggested that ExxonMobil was not already complicit. Anton Smith attended a launch event around the Human Rights Watch report, where he said he “did not recognize” the Equatorial Guinea described by the report’s investigators, who had not visited the country in recent years, in part because it was difficult to do so without official sponsorship. Smith’s adversaries at Human Rights Watch and the advocacy group EG Justice were appalled by his remarks and his defense of the Obiang regime, and they argued privately to State officials that Smith was unfit to represent the United States in Malabo because he had evolved into an apologist for the regime.

As in other areas of foreign policy, the Obama administration proved conflicted about whether to pursue “realist” engagement with Equatorial Guinea or pursue a more liberal, activist agenda of the sort recommended by Human Rights Watch. The department did agree during 2009, as Smith had recommended, to upgrade its representation in Malabo by appointing a full complement of liaisons to Obiang: an experienced ambassador, a deputy chief of mission, and a defense attaché from the Pentagon. To some degree, Smith’s arguments prevailed: The Obama administration continued the policies of security, intelligence, and limited military engagement with Equatorial Guinea that the Bush administration had forged after the 2004 coup attempt. Yet American policy changed only in increments. There was no fundamental reexamination.

On May 4, 2009, Ken Cohen wrote to Human Rights Watch to describe and defend the corporation’s policies in Equatorial Guinea. “ExxonMobil is committed to being a good corporate citizen wherever we operate worldwide,” Cohen wrote. “We maintain the highest ethical standards, comply with all applicable laws and regulations, and respect local and national cultures.” At the same time, “the practical realities of doing business in developing countries are challenging. . . . E.G., like many developing nations, has a limited number of local businesses and a small population of educated citizens. . . . Many businesses have some family relations with a government official, and virtually all government officials have some business interests of their own, or through a close relative. . . .

“While it may be virtually impossible to do business in such countries without doing business with a government official or a close relative of a government official, it is still possible—indeed, it is expected—that we do business ethically and comply with all U.S. and local laws.”
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