November 29, 2024

Greetings From Amsterdam, 

Disgraced U.S. healthcare operator Steward is back in the spotlight. This week, we’ll take a look at the latest updates from a federal corruption probe into the bankrupt company and share OCCRP’s collaborative Steward Files project, an ongoing series of investigations that exposes the financial mismanagement and questionable dealmaking that preceded the firm’s demise. 

We’ll also take a look at top officials’ ties to alleged organized crime leaders in Fiji and Dubai and share upcoming opportunities to engage directly with the OCCRP team.

The sprawling U.S. probe into alleged fraud, bribery, and corruption by healthcare operator Steward reached a new milestone last week when former CEO Ralph de la Torre was briefly detained by federal investigators. He and Steward executive Armin Ernst were both served warrants. Then their phones were seized, according to reporting by OCCRP partner the Boston Globe. 

“On a scale of 1 to 10, this action by federal authorities brings the Steward scandal to an 11," a corporate law expert told the Globe. 

It is the latest chapter of a story deeply reported by OCCRP and its partners in The Steward Files, an investigative series that exposes how Steward’s leadership and investors allowed patient care to falter in favor of expansion, personal enrichment, and expensive smear campaigns. 

Almost 300,000 internal documents leaked from Steward to OCCRP earlier this year and shared with the Boston Globe and the Times of Malta formed the basis of reporters’ investigations.

The series maps the collapse of a company that once ran more than 30 hospitals across the U.S. and reveals the controversial dealings that played out behind the scenes, both at home and abroad.

Highlights of the Steward Files include:

• How business partners and Steward executives squeezed the firm for all it was worth — and more — even as its hospitals slipped into dire conditions.

• A view from the ground of the impact of Steward’s financial choices on hospital staff and patients. (That includes overworked staff paying basic hospital bills and purchasing medical supplies on their own credit cards.)

• The roughly $8 million Steward sent to a Swiss firm implicated in a major corruption scandal in Malta.

• How a private intelligence firm working for Steward arranged for a British politician to air unfounded claims that a well-known short-seller who had criticised the financial dealings of the hospital chain’s landlord was doubling as a Russian agent.

Explore The Steward Files project 

OCCRP Investigates

Over 20 years in Fiji, China-born Zhao Fugang became a prominent hotelier. But police in the Pacific island country believed he was also a leading figure in another local industry — an illicit one. 

In 2020, police warned then-Prime Minister Frank Bainimarama and his police chief Sitiveni Qiliho that Zhao was the suspected leader of a Fiji-based organized crime network. They were told that the network included individuals with previous convictions for crimes including drug and sex trafficking.

Despite those warnings, Bainimarama and Qiliho took no action, police sources say. Instead, they appeared at public events alongside Zhao. Qiliho even registered two companies at one of Zhao’s hotel complexes in Fiji’s capital, Suva. 

Zhao has not been charged with any crime and denies any wrongdoing. But he has come under increased scrutiny since Bainimarama lost office two years ago. A key figure in China’s efforts to build influence in Fiji, Zhao was designated a “priority target” by both Australian intelligence and law enforcement due to suspected organized crime involvement, OCCRP and partners reported earlier this year. 

Bainimarama and Qiliho, meanwhile, were convicted and imprisoned this year on unrelated charges of interfering in a criminal investigation. 

Critics say that Bainimarama’s government often turned a blind eye to an explosion of meth and cocaine trafficking through Fiji, which lies between drug-producing regions in the Americas and lucrative consumer markets in Australia and New Zealand. Last year, a Fijian national was sentenced to four years in New Zealand for illegally importing millions of dollars worth of pseudoephedrine, a key component of meth.

Bainimarama’s successor, Prime Minister Sitiveni Rabuka, has pledged to crack down on drug trafficking and to review policing ties with China. So far, those promises do not appear to have impacted Zhao, who remains a prominent figure in Fiji.

Read the full story 

Crime and Corruption News

Real Estate Deal With Royal Raises Questions About Drug Trafficker’s Business in Dubai

Convicted Italian drug trafficker Raffaele Imperiale became a major cocaine trafficker after moving to the Netherlands in the early 1990s. He briefly lived in Spain before moving to Dubai and “masquerading” as a real estate developer in the 2010s. 

Soon, both Spain and Italy issued warrants and extradition requests for him. They went unanswered, but Imperiale did step down from his role as chairman of AA Real Estate Development, which he created in 2013 and used to build luxury villas in the emirate. 

Imperiale and other investors owned 49 percent of AA Real Estate Developments through another firm. The 49 percent stake was then transferred to a different firm, which was managed by a man who had acted as his proxy in a previous real estate deal in Dubai, according to Imperiale’s statements to Italian prosecutors after he was arrested. 

The remaining 51 percent of the shares in AA Real Estate Development were owned by a former manager in Dubai’s Land Department — until 2015. That year, a new shareholder took over the majority stake: Sheikh Marwan bin Mohammed Al Maktoum, the son of Dubai’s longtime ruler. 

But the former Land Department manager was not in the room to sign the agreement transferring the shares to the royal family member. For reasons that remain unclear, Imperiale signed on his behalf, according to the agreement obtained by OCCRP, IrpiMedia and RTL Nieuws. 

It’s also unclear whether Al Maktoum knew Imperiale was a wanted drug trafficker when he signed the agreement. 

Maktoum exited AA Real Estate Development in 2018, a year after the firm had completed construction of five luxury villas, which sold for a total of nearly $25 million. The firm’s license lapsed four years later, months after Imperiale was finally deported to Italy. 

Imperiale is currently serving a more than 15-year sentence in an Italian prison. After his conviction, he became a witness for the Italian state, providing prosecutors with details about his drug business and associates.

Read the full story 

As Political Tensions Rise, Panama Investigates Dutch Shipping Company

Under the new leadership of Panamanian President José Raúl Mulino, the country appears to be having second thoughts about tax breaks granted to a Dutch shipping company. 

In an August 17 letter obtained by reporters, the Panamanian public prosecutor asked the tax authority for information about the financial accounts of the local subsidiary of the Rotterdam-based inland tanker operator VT Group. 

The move comes after the Netherlands put Panama on its list of tax havens. Mulino, who was elected president in May, has “strongly” rejected the blacklisting, and said Dutch companies would feel the impact. Just months before Mulino went public with those statements on X, the letter obtained by reporters shows that prosecutors were probing the financial accounts of VT Group’s Panamanian subsidiary.

Read the full story 

Insights From OCCRP

How are sanctions being skirted across borders? OCCRP and Transparency International’s Global Anti-Corruption Consortium work together to uncover hidden luxury assets, restricted trade networks, and responses from European authorities. Explore key findings from Cyprus, Georgia, and Belarus and learn how this work drives accountability. 

Democracy is buckling worldwide. In an upcoming exclusive webinar, OCCRP co-founders Drew Sullivan and Paul Radu will discuss the role that organized crime and corruption play in this decay, and what we can expect in the year ahead. Join the live conversation on December 10 at 11 a.m. EST/5 p.m. CET by supporting OCCRP with $25+. By making a donation, you gain access to this event and other webinars for one year. 

We have received more than 50,000 nominations for our Corrupt Person of the Year award so far! If you want our panel of expert judges to consider your pick for 2024, be sure to submit your nomination before December 5.

More crime and corruption news next week.

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