French court jails ex-Algeria golden boy Khalifa in absentia

7th October 2014, Comments 0 comments

Rafik Khalifa, a former tycoon once hailed as the "Algerian Bill Gates", was on Tuesday sentenced in absentia to five years in jail by a French court for embezzling millions when his group went bankrupt.

The 48-year-old, who was once held up as a paradigm for the generation of young Algerians who grew up during the bloody civil war, fled to Britain in 2003 when his business empire collapsed, costing the Algerian state and individuals hundreds of millions of euros.

In 2007, Algeria convicted him in absentia of criminal involvement and fraud, sentencing him to life in prison and demanding his extradition from Britain, which finally took place last December.

He is currently awaiting re-trial after Algeria's supreme court quashed the verdict in 2012.

France also charged him with embezzlement as some of his group's subsidiaries were based there.

On Tuesday, a court in the Paris suburb of Nanterre handed out the jail sentence, fined him 375,000 euros ($470,000) and issued an arrest warrant for him.

The court found he had "looted" his company just before it went bankrupt, by hiding "some of its most significant assets" such as luxury cars, apartments in Paris and a 35-million-euro property in the Cannes Riviera resort.

He famously organised sumptuous parties at the property with celebrities such as Gerard Depardieu, Catherine Deneuve, Sting and Bono.

At the time, Khalifa's empire included a bank, television stations and an airline, and employed 20,000 people in Algeria and Europe.

But there were always questions over how exactly Khalifa was able to amass such a huge fortune.

In 1992, as the bloody conflict between the Algerian government and Islamist rebel groups raged, Khalifa launched into making generic drugs.

In 1998, he set up his Khalifa Bank in just nine months, offering good rates of interest that attracted hundreds of thousands of customers, allowing for his group to diversify into the construction, aviation and broadcasting sectors.

At the height of its success, his group was held up as a role model for a regime emerging from a decade-long civil war and starting to open up to the free market.

Then in November 2002, the bank's operations were frozen after Algerian authorities detected malpractice.

A year later, his entire business empire collapsed, costing the Algerian state and small savers between $1.5 and $5 billion.

A person close to Khalifa who attended the French trial said his downfall was politically motivated.

"He became too cumbersome for the regime and picked the wrong horse" for the 2004 presidential elections, he said, backing Ali Benflis against Abdelaziz Bouteflika, who went on to be re-elected.


© 2014 AFP

0 Comments To This Article