Kleptocrats at Work
by Paul Craig Roberts
Kleptocracy is as old as government. Exotic car broker Michael Sheehan discovered an amazing case nine years ago when he was invited to purchase rare Ferraris and McLaren F1s from a Brunei collection. He writes about it in the current issue of Sports Car Market.
Brunei is a family-owned oil Sultanate of 400,000 people located on the island of Borneo in southeast Asia. A brother of the sultan was finance minister until 1997, when the Asian financial crisis hit Brunei. The Arthur Anderson accounting firm was called in to audit the books. The accountants found that between 1983 and 1998 $40 billion had disappeared and that the finance minister himself had personally spent $14.8 billion.
The finance minister had a collection of 2,500 exotic cars, 500 properties, five yachts, and nine world-class aircraft. He had managed to spend $900,000,000 in the London jeweler Asprey, apparently guaranteeing the old age retirements of a number of attractive women who consort with kleptocrats.
The finance minister was allowed to keep 500 of the cars, but he had to turn in the rest of his loot – to no avail as we shall see.
Sheehan went to Brunei to view the cars. From his general description of the collection, I estimate that the finance minister had paid six figures for the least expensive car in the collection. Many cost much more. McLaren F1s cost $1,000,000 new. They are more valuable now. In October 2008 one sold at a London auction for $4,100,000. Many of the cars were custom built. Some of the high-speed Ferraris “were coated in radar-absorbent matt-black coatings and fitted with infrared cameras for night driving.” Easily more than one billion dollars of Brunei’s oil revenues had found their way into the finance minister’s car collection.