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Rami Makhlouf relinquish his stokes in Syrian banks for humanitarian association

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Editing: Hazem Halak |
Translation: Nouha Salti
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Publication date: 2020/05/28 13:11

Damascus - SMART

The Syrian businessman, Rami Makhlouf, maternal cousin of the Syrian government President, Bashar al-Assad, said that he started transferring his stokes ownership in Syrian banks to his association, Ramak Development and Humanitarian Projects.

On Thursday, and on his official Facebook account, Makhlouf added that he will present all documents about the transference of his stokes to Ramak, saying that these stokes will become inalienable charitable endowment under Islamic law.

Makhlouf said that by this process he returned money to its people, as every sale or profit for these stokes will return to good deeds.

On May 20, 2020, the Clearing and Central depository center decided to fix provisional stoke-seizure on all shares deposited with the center in accordance with the decision issued by the Syrian government’s Ministry of Finance.

On May 19, 2020, the Syrian government seized the assets of Makhlouf, his wife, and children.

On Monday, the Syrian government’s Telecommunications Regulatory Authority  (Sytra) accused Rami Makhlouf of deluding to pay outstanding amounts upon rebalancing his license as the head of the Syriatel Mobile Network Provider Company’s board.

Makhlouf responded to the authority on his Facebook account, denying that he rejected to pay the funds. Makhlouf said that Syriatel submitted a note to the authority that is registered in its Diwan, Number 4,777 on May 10,2020. The note explained that the Syriatel is ready to pay the due funds, asking the authority to specify the sum of the first payment, other payments, and the interest payments

Makhlouf published a video on his Facebook account saying that certain parties from the Syrian government security forces are threatening him of imprisonment if he did not relinquish his company, adding that he was asked to pay 50 percent of the company’s capital (about 120% of the profit) or the company’s assets will be seized.

The Sytra issued a statement on May 2, 2020, in which it responded to the accusations of Makhlouf. The statement said that it set a deadline on May 5, 2020, as the companies agreed to negotiate a mechanism to pay an amount of 233.8 billion SYP (about 180 million US dollars) for the fees of initial licensing allowance, confirming that the sums to be paid by the company are sums due to the government.

Rami Makhlouf founded the Mobile network provider company, Syriatel, in 2002, where he owned 10 percent of the shares, while 63 percent of owned by Drex Technologies S.A. which he founded in the British Virgin Islands. Makhlouf's fortune in 2012 was estimated at 6 billion US dollars (about 10 trillion SYP).

In April 2016, the Panama Papers revealed that the brothers Rami and Hafez Makhlouf took advantage of the kinship’s relationship with the President Bashar al-Assad for economic domination and intimidation of competitors. The two brothers were able to evade the economic sanctions by using the offshores’ system of commercial companies. Al-Assad relatives and people close to him control the economic activity and monopolize most of the natural resources in Syria.

The offshore companies exist in countries with low taxes and financial institutions that are not subject to international control, as they provide advantages, the most important of which are the tax haven, easy access to deposits and protection from financial or political instability, in addition to bank privacy, at a time when these companies and banks are linked to money laundering, organized crime, and tax evasion.

The Syrian government is subject to sanctions by several countries and entities, including the European Union and the United States, whose sanctions include the freezing of bank accounts and the prohibition of dealing with institutions that support the Syrian government, in addition to sanctions on local and international companies and preventing exports from Syria or investing in Syria.