The case of Kuwait’s Public Institution for Social Security (PIFSS)

Another major violation of Kuwait’s public funds involved the corruption and embezzlement of public pensions by Fahad al-Rajaan, the former head of the PIFSS. The defendant faced accusations, including the embezzlement of public funds, betrayal of public trust, and money laundering, relating to when he was the head of the PIFSS. The accused is now a fugitive, as he was sentenced to a ten-year prison term in absentia for the misappropriation of public funds; an international arrest warrant has been issued.[1] A Swiss judge ordered in December 2014 that $100 million in 15 bank accounts (out of the $390 million suspected to have been embezzled) belonging to the defendant be frozen. In 2017, the Westminster Magistrates’ Court ruled that there is no legal barrier to prevent his extradition to Kuwait.[2] This ruling is based on the (unpublished) memorandum of agreement signed in 2016 between the Crown Prosecution Service and the Kuwaiti Public Prosecution.[3] The PIFSS case is one of the successful cases executed through Law no. 1 of 1993 mentioned earlier. Nonetheless, up to this moment, the defendant has not been extradited, and his money is merely frozen and has not been recovered.

The Parliament scandal

In 2011, corruption in Kuwait reached another nadir after the political crises over allegations of corruption involving 15 members of Parliament (MP; out of 50 MPs in total) and the former prime minister. The scandal, as exposed by the Alqabasnewspaper, claimed that 25 million dinars (around £50/S92 million) had been deposited into several MPs’ bank accounts by the former prime minister, allegedly in return for supporting government policies.[4] The public prosecution of the 15 MPs on suspicions of committing money laundering offences was then commenced.[5]

However, this political scandal never went to trial, the suspicious illicit money was never recovered, and the public prosecution was ordered to shelve the case due to the absence of evidence. According to the attorney general’s statement justifying the termination, despite a thorough investigation, there was an ‘absence of bribery or assault of public funds or money laundering offences . . . the Public Prosecution came to the conclusion that further regulation is needed to oblige public officials to disclose their income, and illicit enrichment offence will be implemented.’[6]

The scandal led to the promulgation of the Amiri Decree No. 24 of 2012, ‘Setting up the Public Authority to Combat Corruption and the Pertinent Provision for Financial Disclosure.’ However, in December 2015, the Constitutional Court ruled that the Amiri Decree No. 24 of2012 was unconstitutional.[7] Later, the Council of Ministers approved a new anti-corruption bill, which was subsequently approved by the National Assembly in January 2016; the Law No. 2 of 2016 regarding the NAZAHA was then issued.[8]

One of the significant outputs of the 2012 and 2016 anti-corruption laws is the introduction of illicit enrichment as an offence in Article 22(6). Criminalising the unjustifiable increase in the wealth of high-profile public officials was deemed necessary and led to the promulgation of the Amiri Decree no. 24 of 2012.[9] This form of criminal conduct is recognised in Article 20 of the United Nations Convention against Corruption (UNCAC), which describes it as a ‘significant increase in the assets of a public official that he or she cannot reasonably explain in relation to his or her law- full income.’

Against this background, this chapter next evaluates the Kuwaiti Anti-Corruption Law no. 2 of 2016 in order to identify where Kuwait’s laws fall below the standards of the UNCAC. Special emphasis is placed on the illicit enrichment offence due to its supposed strength and innovation.

  • [1] Subdivision Criminal Court 28 April 2016, No. 159/2015 in the Public Funds Prosecution Department.
  • [2] Westminster Magistrates Court, 5 April 2017 (unpublished).
  • [3] Kuwaiti Attorney General Dherar Al-Assousi, Statement on 6 April 2017 ().
  • [4] Alqabas Newspaper, ‘“The 17 Million deposits into MPs accounts confuse the Banks’” (20 August 2011).
  • [5] Criminal complaints to the Kuwaiti Public Funds Prosecution Department by local banks of Kuwait case numbers: 1283/2011, 1281/2011, 1282/2011, 1287/2011, 1285/2011, 1355/2011,1284/2011,1353/2011,1457/2011,1288/2011,1352/2011,1449/2011, 1280/2011.
  • [6] The Attorney General’s statement in the press conference on October 18, 2012, is available at .
  • [7] Constitutional Court ruling No. 24/2015, December 20, 2015.
  • [8] Kuwait Anti-Corruption Authority ().
  • [9] Commentary Statement on the Amiri Decree No. 24 of 2012 (19 November 2012).
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