CAPITALISM'S ACHILLES HEEL Dirty Money and How to

Dirty Money at Work 79
companies, Bomer Finances Inc. and Nassam Overseas Inc., controlled by
Bhutto and Zardari. Payments of $12 million were made to Swiss bank accounts
of the BVI companies. 54 SGS allegedly has paid kickbacks on other inspection
contracts around the world. Upon being accused in the inspection
kickback scheme, Bhutto sniffed, “I ran the government to the best of my
honest ability. And I did it for nothing but acknowledgment and love.” 55
Then there was the 1994 deal to import $83 million worth of tractors
from Poland. Ursus Tractors allegedly paid a 7 percent commission to another
of Zardari’s Caribbean companies, Dargal Associated. Bhutto waived
import duties on the tractors, costing the Pakistani government some 1.7
billion rupees in lost revenues. Upon discovery of this scheme the Poles hastened
to turn over 500 pages of documentation confirming the kickback. 56
The Polish tractor deal was just a warm-up for the French fighter jet
deal. After the U.S. government cancelled a sale of two squadrons of F-16s,
Bhutto dangled a $4 billion contract for Mirages in front of the French—
Dassault Aviation; Snecma, the engine manufacturer; and Thomson-CSF,
producer of aviation electronics. Without missing a beat they allegedly
agreed to pay a “remuneration” of 5 percent to Marleton Business S.A., yet
another of Zardari’s British Virgin Island companies. 57 This would have generated
a tidy $200 million for the Bhutto-Zardari couple, but unfortunately
for them she was driven from office before they could collect.
Ah, but the gold deal gave some comfort to these aspiring kleptocrats.
Gold is culturally important in the Asian subcontinent, in particular as a
way for women to accumulate wealth. Upwards of $100 billion is invested
in this unproductive asset in Pakistan, India, and surrounding countries.
Smuggling is big business. Ostensibly to regulate the trade, a Pakistani bullion
dealer in Dubai, Abdul Razzak Yaqub, asked Bhutto for an exclusive
import license. In 1994, yet another Zardari offshore company, M.S. Capricorn
Trading, was created in the British Virgin Islands. Later in the year, Jens
Schlegelmilch, “a Swiss lawyer who was the Bhutto family’s attorney in Europe
and close personal friend for more than 20 years,” 58 opened an account
for Capricorn Trading at the Dubai branch of Citibank. According to a
1999 U.S. Senate report: “Mr. Schlegelmilch did not reveal to the Dubai
banker that Mr. Zardari was the beneficial owner of the PIC [private investment
company], and the account manager never asked him the identity of
the beneficial owner of the account. ... Shortly after opening the account in
Dubai, Mr. Schlegelmilch signed a standard referral agreement with