PARIS, 16 November 2004 — The French government dispatched an honor guard last Thursday to escort Yasser Arafat’s earthly remains from French soil to a plane bound for the Middle East. But if France and the other nations of Europe truly want to honor the Palestinian people, the European Union will conduct a public autopsy of Arafat’s finances to ensure that money that belongs to the Palestinian public isn’t illegally bestowed on his widow and daughter.
Arafat’s body was still cooling, the European press reports, when the Palestinian Authority cut a deal with Arafat’s widow, Suha, granting her $20 million plus another $500,000 a year for life. This is rumored to be ransom money that the authority must pay Suha for information regarding Arafat’s “personal” finances.
But rumors — and Suha’s alleged favors to Arafat’s people — aren’t good enough. That money — estimates range from $300 million to $3 billion — doesn’t belong to Suha.
Europe must help Palestinians repatriate their inheritance.
For over 40 years, Arafat conflated the political fortunes of the Palestinian people with his own political fortune — and he commingled their money with his. There is a word for nations that exist without governments (anarchy), but there is no word for what the Palestinian Authority always was under Arafat: A corrupt state bureaucracy without a country.
Arafat’s Palestinian Authority spent more than a billion dollars a year to administer the West Bank and Gaza during the late ‘90s, says the International Monetary Fund.
But Arafat’s PA wasn’t no model of fiscal governance. It lavished international donations and Palestinian tax money on an army of 122,000 politically connected civil servants to administer government services to a population of just 3.5 million. Palestinian officials told the New York Times that Arafat used state money to “pay salaries, bestow gifts, ensure loyalty, establish embassies, buy arms and pay groups ranging from charities to young fighters.”
Beyond Tammany-style “honest graft” and Saddam-style terrorist payoffs, there is good evidence that Arafat diverted hundreds of millions to private, personal accounts outside of the Palestinian territories.
One piece of evidence: The Times has reported that Suha lives on as much as $100,000 a month in Paris. Europe must pick up that alleged money trail from Suha’s doorstep.
France, and Europe, possess clear jurisdiction. Estate successions and money transfers are not private events. If Arafat was unaccountable to his people in life, international law makes him accountable in death.
Money transfers within and across Europe are subject to strict standards enforced by central governments and by the European Union. Europe’s multi-lateral Financial Action Task Force has laid out standards that require financial benefactors and beneficiaries to disclose the sources and uses of funds and assets.
The Palestinian Authority isn’t qualified, ethically or technically, to sniff out Arafat’s money trail. So Europe must prevent Arafat from reaching from the grave to control state finances and victimize his people. The enforcement of global monetary standards — and of national law — should thwart any deals between the Palestinian Authority and Suha.
France has already shown that it is willing to act. Last year, the French launched a money-laundering probe of Suha’s accounts after a government forensic expert determined that she was receiving strange $1 million transfers from Switzerland on a regular basis.
And the Palestinians desperately need their money.
Families that once depended on Israel for trade and jobs have been left destitute as the intifada and Israel’s responses to it choked off much economic activity. In 1998, the Palestinian economy banked $1 billion through bilateral business with Israel, says the IMF; that figure had plummeted by two-thirds by 2002.
On a loftier plane: Financial accountability matters if Palestinians are to build a democracy. Without Arafat at the helm, the PA has a chance to prove it can function as a public institution, not as one person’s political and financial power base.
A European postmortem on Arafat’s reputed fortune — and the timely publication of the results — would ensure that the Palestinians’ post-Arafat political economy gets a fair shot at a good start.
An honest accounting may serve to honor Arafat as well. A clear balance sheet of the fiscal aspects of his life will prove whether or not the magnanimous tribute proffered by former Israeli Prime Minister Shimon Peres last week — that Arafat lived for his people — was true in life and in death.
— Nicole Gelinas is a journalist based in Paris.
