The Adventure Capitalist
Niko Shefer leaned forward and explained the competitive advantage small entrepreneurs enjoy over corporate multinationals when doing business in war-ravaged countries like Liberia and the Democratic Republic of the Congo. �I move with cash. I can buy the president a Mercedes 600. How can a normal company justify that? How do they explain that to the shareholders? I do not need board meetings. I am the board.� Shefer was in an expansive mood. It was December 1999, and he had just earned millions of dollars in profit from a series of business ventures in Liberia, claiming to have got the better of Liberian President Charles Taylor and a fundamentalist Christian organization, known as Greater Ministries of Tampa, Florida. Four years earlier, Shefer had emerged from a South African jail, where he served time for perpetrating one of the country�s biggest bank frauds. Shefer had defrauded a South African bank of more than $10 million before fleeing to Switzerland. He was tracked down, extradited to South Africa, tried, convicted and sentenced to 14 years in prison. He served only six. After his release, Shefer did not wait long before launching new business operations in Africa. According to an information booklet on one of his companies, Tandan, he started out in a field with which he�d had some personal experience: operating prison shops across South Africa. At the end of 1995, the document said, he sold the business to the South African government for U.S. $1.3 million and then moved into trading and mining in Liberia and Sierra Leone. By the end of 1999, Shefer was on the road to respectability. He had insinuated himself into the company of some of the most influential members of the ruling African National Congress. A list of personal references he handed out to prospective business partners included South African President Thabo Mbeki, several Cabinet ministers, and senior members of the South African police force. Shefer also had a brief, and ultimately unfruitful, contact with Mark Thatcher, son of the former British prime minister, over potential business deals in the Congo, and had dined with Dame Margaret herself, at Johannesburg�s plush Westcliff Hotel. Thatcher could not be reached for comment. Shefer even had friends in the South African intelligence community. When HSBC Equator Bank, part of one of the world�s largest banking groups, was contemplating working with him in 1999, it raised concerns about his record and his dealings in Liberia. In response, Shefer brought with him to the bank an official from South Africa�s National Intelligence Agency. Colleagues from the bank later wrote an internal memorandum on the meeting: �Niko was accompanied by C T Beea who is the Director General of South African National Intelligence for the province of Gauteng. Mr Beea explained the historical relationship with Niko and the fact that a number of people [including the former apartheid regime] had tried to discredit Niko. For this reason the National Intelligence Unit had investigated every accusation very thoroughly and was happy to report a clean slate. Beea explained that Niko had been imprisoned in South Africa by the previous regime because of his close association with many of the ANC leaders. Beea confirmed that Niko enjoys an excellent relationship with many of the current Cabinet ministers and in particular with Thabo Mbeki.� The May 1999 memo added that Shefer was �currently assisting the government in unravelling some of the complicated structures used by the former regime� and that �the National Intelligence Unit is thoroughly satisfied in Niko�s integrity and by way of reference invited us to speak to a number of Cabinet ministers.� The bank and its executives, like other associates, would later regret going into business with Shefer. An empire of glossy brochures >From a hilltop complex of mansions and elegant gardens in the wealthiest section of Johannesburg�s northern suburbs, Shefer runs an array of companies, including several divisions of the Tandan group, the Cobalt Metals Company, Scimitar Holdings and Adamastor Resources. The range of documents and promotional literature for companies with letterheads emanating from that address suggest a major corporation. In fact, they are all the work of a lone man in a top-floor office of a mansion. Shefer, an Israeli national who was born in Ecuador, is fluent in several languages, including French and Spanish. He claims to have worked in the Middle East for the Israeli intelligence service Mossad before immigrating to South Africa. A short, stocky man who favors white safari suits and gold chains, Shefer has an agile mind and natural charm. He likes to call people �my brother� and dole out quantities of dollar bills, and once said offering money to African potentates was a �sign of respect.� More than anything, Shefer is one of a new breed of adventurers and opportunists who have the acumen and the ruthlessness to profit from Africa�s war zones. �The key to these countries,� Shefer said in an interview with ICIJ several years ago, �is to know when to get out. No business can survive long in the context of the obscene corruption of these guys � you can survive for a limited period of time, so you have to be able to be involved for a limited period of time. The time to do it is in that period. And then do it again when the next guy comes along.� In 1997, the war-torn country of Liberia held a presidential election that was supposed to end the country�s civil war. One of the candidates for the country�s highest office, Charles Taylor, had previously escaped from a Massachusetts jail while awaiting extradition to Liberia on an embezzlement charge. In 1989, he launched an insurrection from the Ivory Coast and fought a six-year bush war, pillaging timber and diamonds to buy arms, and in the process amassing a personal fortune. William Twaddell, a State Department official, testified before Congress in 1996 that while heading a rebel force operating from the Liberian countryside, Taylor controlled the lion�s share of the country�s more than $421 million a year in diamonds, gold, iron ore and timber trade. Of that, Twaddell estimated, Taylor extracted about $75 million in taxes � to fuel the war and to line his own pockets. � Coming Nov. 13: An in-depth look at an Angolan war profiteer and his links to French, Israeli, Angolan and Russian politicians, corporations and intelligence agencies.
