Portuguese auditing companies that broke anti-money laundering laws while helping Angolan billionaire Isabel dos Santos grow her business empire should face criminal prosecution, the country’s regulator has said.
The Securities Market Commission, CMVM in Portuguese, investigated nine auditing companies that worked with dos Santos following the publication of the Luanda Leaks investigation in January, which was led by the International Consortium of Investigative Journalists.
Five audits are ongoing, according to the regulator’s annual report released on Thursday and reported by Portuguese media, including Expresso, an ICIJ partner on the investigation. CMVM audited 27 entities and opened 84 case files in response to the Luanda Leaks investigation, according to the regulator’s announcement.
The regulator discovered cases in which auditors had not stopped possible money laundering, according to the newspaper Publico. In other cases, auditors did not report suspicious transactions to Portugal’s financial intelligence unit as required when auditors had “sufficient reasons” to suspect that transactions “could be related to funds from criminal activities,” CMVM said.
The regulator also identified situations in which auditors failed to identify parties to transactions, lacked adequate documentation to show “economic substance of underlying transactions” and did not maintain ”professional skepticism,” as required by law.
CMVM recommended its findings be sent to Portuguese prosecutors for possible future criminal investigation, according to Expresso.
Lawyers for dos Santos said in a statement that the regulator’s report points to possible illegalities by auditing companies, not dos Santos herself.
Dos Santos’ lawyers said that her companies “were clients in good faith and trusted the curriculum and professional capacity of these audit companies and will be the first to be interested in clearing up any irregularities,” according to a statement published by SIC Notícias.
The Luanda Leaks investigation, based on 710,000 files shared with ICIJ by the Platform to Protect Whistleblowers in Africa, revealed how Western financial firms, lawyers, accountants, including in Portugal, helped dos Santos and associates move hundreds of millions of dollars in public money out of Angola, one of the poorest countries in the world.
Dos Santos was subsequently charged with money laundering and embezzlement in Angola. Authorities in the southern African country, Portugal and the Netherlands have frozen assets of dos Santos and her husband, Sindika Dokolo, pending the outcome of ongoing criminal and civil probes into deals ranging from diamonds to oil.
Dos Santos and Dokolo deny wrongdoing. Dos Santos, daughter of former Angolan strongman president, José Eduardo dos Santos, claims to be the victim of a political “witch hunt.”