ANTI-CORRUPTION NGO FILES THREE LAWSUITS AGAINST

C O N F I D E N T I A L CAIRO 002491 SIPDIS E.O. 12958: DECL: 12/11/2028 TAGS: PHUM KDEM PGOV EG SUBJECT: ANTI-CORRUPTION NGO FILES THREE LAWSUITS AGAINST THE GOE REF: A. CAIRO 2452 ¶B. CAIRO 2027 ¶C. CAIRO 1992 Classified By: ECPO Mincouns William R. Stewart for reason 1.4 (d). ¶1. (C) Summary and comment: Engi El-Haddad, Director of the Egyptian Accountability Center (EAC),an NGO that focuses on fighting corruption, told us December 11 that her organization has filed three lawsuits against the government to coincide with United Nations Anti-Corruption Day on December 9. Haddad confided to us her belief that the EAC has no hope of winning any of the cases, but wants to raise public awareness of corruption and educate the public about its right to request information from the GOE. Haddad is interested in generating maximum press coverage of the suits through her ties to the independent press. She believes that corruption is one of the most serious obstacles to advancing democratic governance, and her suits may succeed in demonstrating to the public specific instances of the government refusing good faith attempts to increase transparency. End summary and comment. ¶2. (C) The EAC's first suit is against Investment Minister Mahmoud Mohieldin regarding the GOE's transfer of land to former parliamentarian, ruling National Democratic Party heavyweight and businessman Hisham Talaat Mustafa, who planned to use the land for real estate development. Mustafa is currently on trial for ordering the murder of Lebanese pop singer Suzanne Tamim (refs A and B). Haddad alleges that the government transferred the land to Mustafa on the condition that 10 percent of the development revenue be paid annually to the GOE. Haddad believes that Mustafa initially set up a private company to develop the land, and issued an initial public offering (IPO) and sold shares to public banks to raise cash. She contends that the IPO and the stock sale were illegal because the land was originally public. Haddad's suit requests documentation regarding whether the government and the public banks performed due diligence in this case. The suit also requests financial statements to determine whether Mustafa used the cash he raised from the land deal to pay for the murder of Tamim. ¶3. (C) The EAC filed a second suit against Investment Minister Mahmoud Mohieldin to request financial documentation regarding the allegedly no-bid contract for the recent sale of a Cairo hotel. The EAC's third suit is against Minister of Social Solidarity Ali Moselei to request disclosure of the percentage of private and public pension funds currently invested in the Egyptian stock market. ¶4. (C) Separately, Haddad told us she is planning a Cairo conference in conjunction with Transparency International at the beginning of January on transparency in the financial sector. Haddad said that the aim of this conference is to highlight the public's right to financial information. She is trying to present the event as technical and academic, and is looking into securing speakers along these lines, in order to convince State Security (SSIS) to allow it to proceed. Haddad predicted that if SSIS cancelled the conference, such a decision would generate even more publicity for her anti-corruption efforts. (Note: Per ref C, a Cairo hotel cancelled a Transparency International conference at the last moment in May, but the Interior Minister denied his ministry played a role. End note.) ¶5. (C) Comment: Haddad is trying to use all the tools at her disposal to focus the public's attention on issues of corruption and non-transparency, which she believes are two of the most serious obstacles to advancing democratic governance in Egypt. An investment banker by training, she understands that the public availability of financial documentation is essential to increasing economic and political transparency. The public is already jaded in its estimation of widespread government corruption, but Haddad's suits could succeed in underscoring specific cases where the government is blocking activists' best attempts to increase transparency. SCOBEY