Liberia's "Flag" Pays for Sanction Busrting

The Perspective

October 25, 2001

The report of the UN sanctions committee on Liberia will be made public this week. Sanctions were imposed on Liberia on May 7, 2001, due to Liberia’s involvement in the Sierra Leone civil war. UN is to review the existing sanctions to decide whether to extend them or impose new sanctions that will include timber, rubber and the shipping registry.

Some observers feel that the information contained in the committee's report is the last thing the Taylor government wanted. The 135-page report cites four payments that were made to non-governmental accounts – two of the payments totaled about a million dollars. These payments, made last year, were used by the Taylor government to buy arms in violation of UN arms embargo against Liberia.

According to the five-member committee, "For as long as there is an arms embargo against Liberia, funds from the registry will need to be protected from bureau misuse."

It can be recalled that on August 13, 2001, this paper, quoting other sources, reported payments originating from the account of Bureau of Maritime Affairs at EcoBank to San Air General Trading at the Standard Chartered Bank in Sharjah, Dubai. The transactions were made based on instructions from the Commissioner of the Bureau of Maritime affairs, Benoni Urey, and carried out by LISCR.

Report reaching The Perspective, though not yet confirmed, speaks of payment of about $400,000 sent from the LISCR account at the Branch Banking & Trust in Washington, DC, to San Air Standard Chartered Bank of Dubai for arms.

According to the recent report by Global Witness and ITF, "Ship owners from all over the world have registered their vessels in Liberia rather than under their own national flag. 60% of the fleet on the Liberian register is owned by American, German, Greek, Japanese and Norwegian shipping companies. With around 1,557 vessels registered under its flag, Liberia, one of the poorest countries in the world, currently has the world's second largest maritime fleet in shipping tonnage (52 million gross tonnes). Notably absent from the nationality list of vessels on the Liberian register are any Liberian-owned ships...

"Faced with shipowners' increasing concerns about the register in the aftermath of the change in management contract, a price war with other registers has been launched. A new scale of fees was introduced for ships entering the register after 1 July 2000 and all initial registration fees are waived from then until the end of 2001...

"These fees are collected by the US company administering the register. By the year 2000, the Liberian registry was netting an average of some $15 - 20 million per year for Charles Taylor's government."

In addition, UN Secretary General Kofi Annan wrote in his report to the Security Council: "The Bureau of Maritime Affairs employs less than 100 Liberian staff and most of the registry’s work is carried out in offices abroad. Therefore, little direct impact on the Liberian population is anticipated from possible restrictions on the Liberian ship register. Most of the staff of the Bureau are educated employees with specific technical qualifications and expertise. The majority of them would probably find other jobs or could emigrate to take up maritime-related work abroad."

Money from the Maritime also benefits Taylor’s "Inner Circle". On August 14, 1997, twelve days after Mr. Taylor was inaugurated president, he issued Executive Order #1 to the president of the International Trust Company (ITC), a U. S. based corporation that managed the Liberian shipping registry. Based on this order, the president of ITC was instructed to place 10% of the Maritime revenues into the personal account of Mr. Benoni Urey, Commissioner of the Bureau of Maritime Affairs. Confronted by this paper in 1998, Mr. Urey admitted to the existence of such account and said that there was nothing unusual about it.

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