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Broad Crackdown Reins In Saudi Arabia’s Elite
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Broad Crackdown Reins In Saudi Arabia’s Elite

Source: wsj.com

Editor’s Note: Crown Prince Mohammed bin Salman is consolidating his power as he prepares to take Saudi Arabia in a new direction. While these changes are significant indeed, he is by no means the liberal he purports to be.  Please see Henrik Palmgren’s excellent investigative report for more detail on bin Salman, The Future Investment Initiative, the ambitiously futuristic Neom megacity project, and the emergence of artificial intelligence. – Mundilfury.

A sweeping weekend roundup of more than five dozen princes, ministers and prominent businessmen in Saudi Arabia marks a dramatic escalation in the crown prince’s effort to consolidate power and accelerate far-reaching change in the kingdom.

Saudi officials said the crackdown stemmed from a probe aimed at stamping out corruption. It touched some of the most widely known people in the country, including Prince al-Waleed bin Talal, an international tycoon who is one of the richest men in the world, according to people familiar with the matter.

“This is a crucial turning point,” said Bruce Riedel, a senior scholar at the Brookings Institution and a former Central Intelligence Agency officer. “Saudi royal politics have gone from consensual to an unstable blood sport.”

On Sunday, as the kingdom digested news of the arrests, another Saudi prince was killed in a helicopter crash near the kingdom’s border with war-torn Yemen. It wasn’t immediately clear what caused the crash.

The targeting for arrest of high-profile figures represents an escalation of a campaign of detentions in recent months. It comes less than five months after King Salman installed his son, Prince Mohammed bin Salman, as crown prince and heir apparent, sending shock waves through the kingdom and stirring internal opposition.

The crown prince has vowed to tackle corruption at the highest levels as part of the government’s plan to overhaul the kingdom’s economy and free Saudi Arabia from its dependence on oil revenues.

At least some of those who were rounded up over the weekend are being held at Riyadh’s Ritz Carlton, a luxury hotel that resembles a royal palace. Just weeks earlier, the Ritz hosted a large business conference sponsored by the crown prince that drew some of the world’s top investors and entrepreneurs to the Saudi capital.

The hotel evacuated all guests on Saturday. Repeated calls to the hotel went unanswered. Two Saudi officials said other five-star hotels in Riyadh are also being used to host suspects in the probe.

“I passed by the hotel today and you could see tight security and ambulances next to it,” said a financial consultant who works with the Saudi government and usually stays at the Ritz.

Crown Prince Mohammed, who is 32 years old, has risen to a position of almost unrivaled authority since King Salman assumed the throne in early 2015. The octogenarian monarch is expected to abdicate either later this year or early next year, according to people close to the royal court.

According to people familiar with the matter, another member of the royal family detained was Prince Miteb bin Abdullah, a politically influential son of the late King Abdullah who led the kingdom’s National Guard, one of the three main branches of Saudi Arabia’s security forces.

Prince Miteb was among several senior princes who privately criticized the unceremonious removal of Prince Mohammed bin Nayef as crown prince in June, according to people close to the royal family. He was the most senior prince in a position of authority who didn’t belong to King Salman’s branch of the royal family.

One senior Saudi official said the removal of Prince Miteb is a precondition to the king’s abdication in favor of Prince Mohammed, who is also known as MBS. King Salman on Saturday night issued a royal order firing Prince Miteb from his cabinet.

“Prince Miteb was always the prince that needed to be sacked before MBS becomes a king. He was often viewed as a leading contender for the throne and is known to be very ambitious,” said the senior Saudi official. “Some arrests, particularly him, are more of a move to consolidate power rather than to fight corruption.”

Prince Miteb could face allegations of bribery, according to people familiar with the matter. He couldn’t immediately be reached for comment.

The detentions are overseen by a newly established anticorruption agency headed by the crown prince. The agency, formed on Saturday by a decree issued by King Salman, has far-reaching authority in cases of suspected corruption involving public funds, including the power to issue arrest warrants, to impose travel restrictions and to freeze assets.

“Laws will be applied firmly on everyone who touched public money and didn’t protect it or embezzled it, or abused their power and influence,” King Salman said in his decree. “This will be applied on those big and small, and we will fear no one.”

The government said any assets or property acquired through corruption will be transferred to the state.

The government hasn’t named the people who were detained. Attorney General Sheikh Saud al-Mojeb said Sunday that the new anticorruption agency “has initiated a number of investigations as part of the state’s judicial duty to combat corruption.”

Mr. Mojeb added that “suspects are being granted the same rights and treatment as any other Saudi citizen. A suspect’s position or status does not influence the firm and fair application of justice.”

A lawyer familiar with the investigation said that Saudi authorities began their probe into alleged corruption two years ago and that the Saudi government has already frozen assets like bank accounts belonging to the accused.

“They saw money getting in the wrong bank accounts,” said the lawyer. “They can immediately freeze bank accounts, and they have done that. They can now reach out to foreign jurisdictions and freeze their assets there.”

The detentions send a clear message that corruption won’t be tolerated as the kingdom pushes through its economic overhaul, a plan known as Vision 2030, said Mohammed Alyahya, a Saudi political analyst and nonresident fellow at the Atlantic Council in Washington, D.C.

“MBS has made it very clear that he will crack down on corruption, and that he is willing to do it from the top first,” Mr. Alyahya said. “The bottom line is that corruption costs the government. We have economic problems…There is no way you can achieve Vision 2030 without tackling these issues.”

The plan is centered on the initial public offering of a piece of the state energy firm, Saudi Arabian Oil Co., the largest oil producer in the world. The IPO could generate as much as $100 billion, making Saudi Arabia’s sovereign-wealth fund the largest in the world.

 

 

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