Goldman Sachs backs Angolan oil deal despite corruption risks - Global Witness

PWYP member Global Witness has just issued a press release revealing that the investment bank Goldman Sachs is backing an oil deal in Angola by U.S. firm Cobalt International Energy, despite a risk that local partners in the deal could expose Cobalt to prosecution for corruption in the United States.

Goldman Sachs is a major shareholder in Cobalt and two of its executives sit on Cobalt’s board. Agreements with the Angolan state oil company, Sonangol, give Cobalt shares in two Angolan oil exploration blocks and assign it two local partners, Alper Oil Limitada and Nazaki Oil and Gáz S.A. Global Witness points out that Alper and Nazaki are obscure companies with no visible industry track record. This is a serious concern as Angola is a poor country afflicted by severe corruption: many observers believe that small and little-known companies are used as fronts by top Angolan officials to enrich themselves privately.

“It seems extraordinary that Goldman Sachs would back this kind of deal in Angola, a notoriously corrupt country, at a time when the bank’s own business ethics in the United States are under heavy fire,” said Diarmid O’Sullivan of Global Witness. Last month, Goldman Sachs was charged with fraud by U.S. authorities in relation to its dealings with mortgage-backed securities in the United States.The Wall Street bank has denied any wrongdoing.

Read Global Witness’ press release here .