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Which US Banks Are Managing Billions For The $32 Billion Libyan Sovereign Wealth Fund?

Tyler Durden's picture




 

Following the previous post taking a tangential if insightful peek into Gaddafi's personal eccentricities, we next look at something far more important, where once again courtesy of Wikileaks disclosure, we find that the Libyan Sovereign Wealth Fund (Libyan Investment Authority, or LIA), whose holdings were first dissected on Zero Hedge, and whose AUM is supposedly a massive $32 billion, has "several American banks each managing USD 300-500 million of the LIA's funds." Perhaps now that UniCredit has plunged by 12% in the past few days due to the recognition of Libya's involvement in the bank it is time for the US banks who manage billions in capital for the LIA, to step up. After all even most of the country's ambassadors have vocally recused themselves of any association with the government. Perhaps our banks can show a comparable level of objectivity and at the loss of a few million in management fees clean their conscience, before someone does it for them. Also curious is the fact that the LIA appears to have had its own direct involvement with a certified ponzi after having been approached by both Stanford (with a rumored investment by the LIA being the end result) as well as the one, the only, original (post-modern) ponzmaster, Bernie Madoff.

From Wikileaks:

C O N F I D E N T I A L SECTION 01 OF 02 TRIPOLI 000079

SIPDIS

STATE FOR NEA/MAG, COMMERCE FOR NATE MASON

E.O. 12958: DECL: 1/26/2020

TAGS: CVIS PREL ECON EFIN ECIN EINV EIND ETRD ETTC LY

SUBJECT: TECHNOLOGY TO TOURISM: HEAD OF INVESTMENT AUTHORITY DISCUSSES OPPORTUNITIES FOR U.S. BUSINESS IN LIBYA

CLASSIFIED BY: Gene A. Cretz, Ambassador, U.S. Embassy Tripoli, Department of State. REASON: 1.4 (b), (d)

1.(C) Summary. During a January 20 meeting with the Ambassador, Mohamed Layas, the Head of the Libyan Investment Authority (LIA, Libya's sovereign wealth fund), welcomed the February 20-23 Department of Commerce-led Trade Mission and highlighted ways that U.S. businesses could thrive in Libya, particularly in the tourism and health services sectors. The Ambassador underlined the need for the Libyan government to eliminate the "visa freeze" for official Americans and to improve the visa process for other Americans, including allowing American tourists to enter Libya. Layas asserted that the LIA has USD 32 billion in liquidity, and noted that several American banks are each managing USD 300-500 million of the LIA's funds. End Summary.

HOW U.S. BUSINESS CAN THRIVE IN LIBYA: TECHNOLOGY TO TOURISM

2.(C) During a January 20 meeting in his prime office-space overlooking the Mediterranean Sea, Layas discussed with the Ambassador (accompanied by the FCS officer and P/E chief) the many ways in which U.S. businesses could thrive in Libya, through investment, trade, and joint ventures. He welcomed the February 20-23 Department of Commerce Trade Mission and offered his thoughts on how to make the program a success -- "The best thing to do is to meet the right people here. You should have 2-3 ministers address the whole group." He explained that the LIA was very interested in attracting more U.S. business to Libya and believed the U.S. could play a "major role" in Libya's development. During a recent visit to Washington, Layas met with a number of American company representatives, as well as the Export-Import Bank (EXIM), to educate them on opportunities to invest in the "unique [Libyan] market," which according to him, unfortunately includes bureaucratic "red tape and corruption." Some of the advantages that Layas saw the U.S. having over European competitors for contracts in Libya are the weakness of the dollar compared to the Euro, as well as U.S. access to more advanced technology. Layas believes U.S. companies can expand on their success in Libya's hydrocarbon market by competing for contracts in the electricity market, health services, and tourism.

3.(C) Layas was particularly interested in importation of advanced U.S. medical technology, outlining plans to create a large medical center in Tripoli. He sees opportunities for U.S. firms to enter into joint ventures with Libyan companies to develop such plans. Additionally, he noted that the LIA plans to manage a large tourism development plan, which will involve USD 1 billion projects in Western Libya, Eastern Libya, the Green Mountains, and potentially another city (most likely Tripoli). Layas believes more than half of Libya's projected USD 136 billion development plan budget has been committed in contracts, but implied that some companies may back out of those contracts, as they were "reconsidering the conditions." Layas asked the Ambassador to pass on the message that Libya was still open to development by U.S. companies and that Libya wants to establish "lasting relationships" with major U.S. firms.

IMPROVING BILATERAL RELATIONS THROUGH VISAS

4.(C) The Ambassador attested to the interest of Americans -- businesspeople, government officials, and tourists -- in coming to Libya, but underlined the obstacles that Americans face when trying to obtain visas. The current "visa freeze" for official Americans was only the latest in a number of difficulties that Americans faced. The Ambassador highlighted the imbalance in our governments' approaches to the relationship -- whereas the Embassy provided full consular services and had issued over 3,000 visas to Libyans since opening in April 2009, U.S. tourists still could not visit Libya. The situation is affecting Embassy operations, including planning for the Trade Mission, and needs to be addressed. Layas sympathetically commented that he had also faced problems recently in trying to obtain visa approvals for a number of American businessmen that had been invited to visit Libya for business discussions.

LIA'S INVESTMENTS: WEATHERING THE STORM

5.(C) The Ambassador stressed the U.S. commitment to the bilateral relationship, including in trade and investment. He inquired about the state of the Libyan economy and the LIA's wealth in particular, given fallen oil prices and the recent world economic crisis. Layas informed the Ambassador that Libya had "weathered the storm" of the economic crisis. He noted that the LIA operated with "high liquidity," and therefore was not concerned about the volatility of the oil market. "We have USD billion in liquidity," he stated, "mostly in bank deposits that will give us good long-term returns." He explained that several American banks are each managing USD 300-500 million of LIA's funds, and opined that the LIA was entangled in a legal disagreement with Lehman Brother's due to a major investment that was "mismanaged." He said that the LIA has an office in London and preferred doing business there rather than in the United States, due to the "ease of doing business" in the UK and relatively "uncomplicated tax system." He noted that the LIA's primary investments are in London, in banking and residential and commercial real estate.

6.(C) Layas denied press reports that the LIA had invested USD 100 million with the infamous Allen Stanford. He said that he had personally written a letter to the "Financial Times" disputing the information, explaining that Stanford had approached the LIA in the middle of his crisis, offering a 7-8% share in his investment scheme, but Layas had refused. Layas also mentioned having been previously approached by Bernard Madoff about an investment opportunity, "but we did not accept." On the contrary, LIA's recent purchase of the Canadian Verenex oil company -- after much controversy over the manner in which it was purchased and share price -- was considered by Layas a "good deal." LIA plans to operate Verenex jointly with the Libyan Investment and Development Corporation (LIDCO).

7.(C) Comment: The LIA controls at least seven subsidiary organizations, and a fund that holds USD 32 billion in liquid assets. The fact that Layas weathered his own storm -- LIA's controversial, reported entanglement with Allen Stanford -- in a regime that has proven to be unforgiving in the face of embarrassment, is surprising, and indicative of his strong ties to powerful protectors within the Libyan regime. End comment.

CRETZ0 01/28/2010 6969 CVIS,PREL,ECON,EFIN,ECIN,EINV,EIND,ETRD,ETTC,LY TECHNOLOGY TO TOURISM: HEAD OF INVESTMENT AUTHORITY DISCUSSES OPPORTUNITIES FOR U.S. BUSINESS IN LIBYA During a January 20 meeting with the Ambassador, Mohamed Layas, the Head of the Libyan Investment Authority (LIA, Libya's sovereign wealth fund), welcomed the February 20-23 Department of Commerce-led Trade Mission and highlighted ways that U.S. businesses could thrive in Libya, particularly in the tourism and health services sectors. The Ambassador underlined the need for the Libyan government to eliminate the "visa freeze" for official Americans and to improve the visa process for other Americans, including allowing American tourists to enter Libya. Layas asserted that the LIA has USD 32 billion in liquidity, and noted that several American banks are each managing USD 300-500 million of the LIA's funds. End Summary.

 

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Tue, 02/22/2011 - 19:31 | 986821 jesse livermoore
jesse livermoore's picture

the original pozi schemer is Charles Ponzi   .  the scheme was named after him

Tue, 02/22/2011 - 19:40 | 986839 pauldia
pauldia's picture
Tuesday, February 22, 2011 Soros Behind Morocco Riots and Revolts against other U.S. allies across Mideast, North Africa

http://atlasshrugs2000.typepad.com/atlas_shrugs/2011/02/soros-behind-mor...

 

Tue, 02/22/2011 - 20:01 | 986891 markmotive
markmotive's picture

Elites hoarding resources for personal gain. Revolt. Booms. Busts. Sabotage. Bloodshed. We've seen it before and we'll see it again...

It's called peak oil folks. Get used to it.

http://www.planbeconomics.com/2011/01/31/peak-oil-and-the-new-boom-bust-cycle/

Tue, 02/22/2011 - 21:27 | 987094 Careless Whisper
Careless Whisper's picture

there's 1 TRILLION barrels of oil in the rocky mountains. it's called shale oil.

 

Wed, 02/23/2011 - 12:17 | 988667 markmotive
markmotive's picture

a) How does the quality compare to the stuff from the middle east?

b) How much does it cost to get it out of the ground?

c) How much does it cost to refine?

d) How much of that trillion barrels is usable?

 

Tue, 02/22/2011 - 19:40 | 986847 Leo Kolivakis
Leo Kolivakis's picture

What I really want to know is how much money Libya, Egypt, Saudi Arabia, and a bunch of other countries on the verge of ''revolution'' have funnelled over to US arms manufacturers? Anyone willing to hazard a guess? It's called recycling petro-dollars, key word there being USD!!!

Tue, 02/22/2011 - 20:15 | 986928 blindman
blindman's picture
Keiser Report: Fed’s Reign of Terror (E123) February 22nd, 2011 by maxkeiser

We interview William D. Hartung

http://maxkeiser.com/2011/02/22/keiser-report-feds-reign-of-terror-e123/

Tue, 02/22/2011 - 19:42 | 986855 Yen Cross
Yen Cross's picture

 I'm not even reading this article. This is blind Citi?

Tue, 02/22/2011 - 19:49 | 986872 Sylvia Plath
Sylvia Plath's picture

I guess it took a crook (Qaddafi) to recognize a crook... Bernie & Allan... Just goes to show the accounting gimmick that got them over at Dick's Lehman.

 

Who is the fairest crook of them all? 

Tue, 02/22/2011 - 20:17 | 986929 NotApplicable
NotApplicable's picture

Yeah, I'm kind of scratching my head on this news.

Perhaps they should hire Mohamed Layas to head the SEC?

Tue, 02/22/2011 - 19:57 | 986882 luk427
luk427's picture

The elite are using Wikileaks to create world chaos,to accelerate their master plans.   http://wakeupcallfortruthseekers.wordpress.com/2010/12/24/wikileaks%E2%80%99-assange%E2%80%99s-lawyer-has-connections-to-rothschilds/

Tue, 02/22/2011 - 20:09 | 986907 luk427
luk427's picture

Yah I saw that after, should have used better link.  http://www.thetruthseeker.co.uk/?p=16166

Tue, 02/22/2011 - 20:11 | 986919 ZerOhead
ZerOhead's picture

Premature hijackulation.

Happens to the best of us! :)

Tue, 02/22/2011 - 21:21 | 987079 gwar5
gwar5's picture

That was good!

Tue, 02/22/2011 - 20:14 | 986926 Yen Cross
Yen Cross's picture

No link will ever overcome that comeback! Nice work Arkadaba! Rol on my deck. Funny.

Tue, 02/22/2011 - 20:28 | 986947 NotApplicable
NotApplicable's picture

Hip-hop is now a psy-op, headed by the Black-Eyed Peas, proponents of trans-humanism.

http://takimag.com/article/why_i_quit_touring_with_the_black_eyed_peas

Of course, so were the Beatles, and all of the Disney stars like Britney Spears.

Tue, 02/22/2011 - 20:09 | 986911 99er
99er's picture

Boy, do you folks at Zero Hedge come up with some doozies! Great read this. Thanks!

Tue, 02/22/2011 - 20:10 | 986914 blindman
Tue, 02/22/2011 - 20:30 | 986955 Misean
Misean's picture

"several American banks each managing USD 300-500 million of the LIA's funds."

NO F*CKEN WAY! Next thing you'll tell us is that the sun is expected to set in the west and rise in the east.

Tue, 02/22/2011 - 20:34 | 986964 buzzsaw99
Tue, 02/22/2011 - 20:47 | 986996 treasurefish
treasurefish's picture

I don't care who or what is setting all these fires in the Middle East - I think it rocks!  Just watching Hillary Clinton fail and snivel about it is worth it. Maybe something good can come out this whole thing like:

1. Israel gets blown up.

2. The US quits forking over our future to prop up idiots.

Tue, 02/22/2011 - 20:56 | 987012 Yen Cross
Yen Cross's picture

 Good thing the tampon days are over Ehhh. Smiles

Tue, 02/22/2011 - 21:29 | 987097 oygevalt
oygevalt's picture

3.  Maybe you could learn what world oil demand is, if they really harp on it on the evening news.

Wed, 02/23/2011 - 00:00 | 987511 Yen Cross
Yen Cross's picture

Would you like it (crude demand) on a nominal or static chart?

Wed, 02/23/2011 - 05:54 | 987918 oygevalt
oygevalt's picture

Thanks - I was making a reference to treasurefish pounding the table that world demand was 40 million bbl/day, which isn't close to correct.

Tue, 02/22/2011 - 21:20 | 987076 zaknick
zaknick's picture

Jooooo alert! All hands on deck! Prepare to be showered with jooooo confetti!

Tue, 02/22/2011 - 21:23 | 987081 gwar5
gwar5's picture

Muammar is sooo busted.

Tue, 02/22/2011 - 21:45 | 987151 Yen Cross
Yen Cross's picture

 Nice revolt keep it up! ZH crew.

Tue, 02/22/2011 - 23:02 | 987340 AUD
AUD's picture

the LIA appears to have had its own direct involvement with a certified ponzi after having been approached by both Stanford (with a rumored investment by the LIA being the end result) as well as the one, the only, original (post-modern) ponzmaster, Bernie Madoff.

Thus the reason for the 'revolution'. Obviously Madoff & co. blew the LIA's investment & now Gadaffi has no money. He will rue the day he sold out for a fist full of US dollars.

Shoulda just bought gold.

Wed, 02/23/2011 - 00:34 | 987595 dick cheneys ghost
dick cheneys ghost's picture

castro says nato is planning to invade Libya

 

http://nakedempire.wordpress.com/

Wed, 02/23/2011 - 01:01 | 987648 Yen Cross
Yen Cross's picture

Can you ask the fossile if a box of Cohibas and purple Punches can be procured. The guage of the cigar is not important. Although a good Partigas Dominican torpedo can work wonders.

Wed, 02/23/2011 - 07:16 | 987951 Fíréan
Fíréan's picture

What's new ? The USA financed Hitler's Germany until forced to stop long after the war had started.

Wed, 02/23/2011 - 09:01 | 988009 oh_bama
oh_bama's picture

You guys must be kidding yourselves.. This is a joke.

Most of kadafi's money is diversified all over the world. Italy has slightly more among developed country banks but still even a billion in US is nothign to him.

Wed, 02/23/2011 - 11:36 | 988484 epwpixieq-1
epwpixieq-1's picture

"there's 1 TRILLION barrels of oil in the rocky mountains. it's called shale oil."

It MAY be true, although as generally stated all around the media is just a big BS.

And now lets ASSUME that it is true. Then think about HOW MUCH will cost to extract it, refine it and the quality, if it to be the main ingredient for the petrol products.

The Peak Oil theory is not about running out of Oil, although this is coming too, it is running out of CHEAP Oil.

When you start dealing with the REAL physical science then the world starts too have totally different view, and dependant on infinitely many variables.

Let me open you eyes for something. In the world of computing there is NO LAW OF GRAVITY. On the contrary in the REAL world there is LAW OF GRAVITY although, I will have to add, it is not clear what exactly is the underlying force controlling it.

 

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