Gaddafi's Wealth Fund Turned Down Madoff, Stanford

Feb 24 2011 | 8:37am ET

He may be a despot with questionable fashion sense, but Libya’s Muammar Gaddafi apparently knows a Ponzi scheme when he sees one.

According to a U.S. diplomatic cable reporting a January meeting between Mohamed Layas, the head of the Libyan Investment Authority (the country’s secretive sovereign wealth fund) and the U.S. ambassador in Tripoli, Layas declined to invest with fraudsters Bernie Madoff and Allen Stanford.

The LIA claims to control $32 billion in liquid assets, most of which is deposited in U.S. banks. Besides passing on Madoff and Stanford, the cables also show Layas expressing his concern that Lehman Brothers was mismanaging Libyan investments.

Part of the text of the cable reads as follows:

6.(C) Layas denied press reports that the LIA had invested USD 100 million with the infamous Allen Stanford. He said that he had personally written a letter to the "Financial Times" disputing the information, explaining that Stanford had approached the LIA in the middle of his crisis, offering a 7-8% share in his investment scheme, but Layas had refused. Layas also mentioned having been previously approached by Bernard Madoff about an investment opportunity, "but we did not accept."


In Depth

GSAM's Papagiannis: Liquid Alternatives For The Long Run

Apr 21 2017 | 8:44pm ET

Interest in liquid alternatives cooled a bit last year amid a broad shift in investor...

Lifestyle

Aston Martin Returns To Debt Market As DB11 Drives Turnaround

Mar 31 2017 | 5:21pm ET

James Bond’s preferred carmaker is returning to the public debt markets for the...

Guest Contributor

Debunking Conventional Investment Wisdom (Part II)

Apr 17 2017 | 5:56pm ET

The alternative investment industry is currently replete with buzzwords around data...

 

From the current issue of