Al-Ahram Weekly | Egypt

		26 Sept. - 2 October 2002 Issue No. 605 Home news	Current issue Previous issue Site map
Published in Cairo by AL-AHRAM established in 1875		Recommend this page

Falling star
As the assets of the ruling NDP's banking tycoon and parliamentary star Abdallah Tayel were sequestered, people are asking what went wrong

At the seventh congress of the ruling National Democratic Party (NDP), held in July 1998, Abdallah Tayel, the then executive manager of Misr Exterior Bank, was one of a few businessmen who actively participated in debates and sessions. Tayel, who was hand-picked in 1997 by the NDP's old guard to be chairman of parliament's economic affairs committee, subsequently became so influential that some predicted that he would be the next governor of Egypt's Central Bank, reports Gamal Essam El- Din.
Last week, however, Tayel was unable to attend the meetings of NDP's three-day-long eighth congress. The reason: he was being investigated by the prosecutor- general on charges of banking fraud and graft. He was released from custody after paying a hefty fine of LE20,000.
On 19 September, Prosecutor- General Maher Abdel-Wahed ordered that Abdallah Tayel's movable and unmovable assets be sequestered. Abdel-Wahed's order also applied to the assets owned by Tayel's wife, two sons and one daughter. Moreover, Abdel-Wahed barred Tayel from leaving the country.
Abdel-Wahed's order was preceded by two requests submitted to Parliament Speaker Fathi Sorour, asking that Tayel's parliamentary immunity be lifted to permit his investigation on various banking fraud charges. Sorour approved the first request in July while Parliament was in summer recess, while the second came only last week.
The first series of charges against Tayel concerns his alleged use of his post as chairman of Misr Exterior Bank (an Egyptian-Spanish joint venture) to provide, in return for hefty bribes, 16 businessmen with credit facilities even though they did not have adequate collateral. The Central Bank of Egypt (CBE) had already investigated the charges and agreed that Tayel be referred to the prosecutor-general for investigation. The value of bad loans made by Tayel is estimated at LE1.7 billion.
Other charges, for which Tayel's immunity was lifted last week for the second time, contend that Tayel was involved in a range of shady practices that led to the plunder of a sizeable portion of Misr Exterior Bank's funds. Topping this list of charges is the accusation that Tayel approved the reduction of debts on dollar-denominated loans taken by businessmen, such as the iron and steel magnate Tayseer El-Hawari, to Misr Exterior Bank in exchange for personal favours. According to the charges, Tayel agreed that the exchange rate according to which the businessmen would pay their debts should be $1 against LE4.27. As this rate was clearly far less than the official rate ($1 for LE4.61), it caused Misr Exterior Bank (MEB) losses amounting to approximately LE26 million.
The prosecution's investigation also revealed that Fakhri, Tayel's older son, was in a partnership with some of MEB's heavy borrowers in a company called "The Reconstruction Projects Company". Tayel gave this company, in which his son has a large stake, hefty MEB loans. Tayel was also charged with speculating on the Egyptian pound.
The charges against Tayel were announced by the Administrative Control Authority (ACA), which is Egypt's main anti-corruption watchdog, after Nabil Ibrahim, MEB's former chairman who had been replaced by Tayel, provided ACA with a dossier thoroughly documenting Tayel's crooked practices.
Tayel, 68, is a close associate of Kamal El- Shazli, minister of state for parliamentary affairs and NDP's assistant secretary-general. In the 1960s Tayel and El-Shazli were both members of late President Gamal Abdel-Nasser's Arab Socialist Union for the northern delta governorate of Menoufiya. Talla, Tayel's constituency, is just five kilometres from El-Shazli's constituency of Al-Bagour. Tayel was nominated by El-Shazli to run in 1995's parliamentary elections. He was also supported in 1997 by El-Shazli to replace Mustafa El-Said, a former economy minister, in heading parliament's economic affairs committee.
Asked about Tayel's rapid rise and fall, El- Shazli said, "I was really surprised by the corrupt practices that he was accused of." Tayel is expected to be replaced as head of parliament's economic affairs committee by Fayeqa El-Rifa'i, an appointed MP and a former CBE deputy- governor.

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