“ASSET PURGATORY” Where Libya’s Looted Billions Await

Abstract

International sovereign asset recovery sorts vast sums of looted state wealth into one of three destinations: the hands of the public, where it always should have been; the dubious world of Moneyland, which facilitates the global circulation of illicit assets; or “Asset Purgatory,” where $20 million beachfront villas seemingly sit vacant in perpetuity. This thesis posits that international asset recovery is not an automatic consequence of exposing the illicit holdings of corrupt heads of state. Conventional international mechanisms to recover illicit assets held in foreign jurisdictions often require legal efforts to be initiated by the state seeking repatriation. In response to this frequently inequitable dynamic, this thesis claims that successful international asset recovery through conventional pathways is only feasible under a set of three interdependent conditions: (1) multiple forms of international recognition, (2) state capacity, and (3) political stability. When these conditions are weak, asset recovery either stalls, or proves altogether unsuccessful. This argument is shaped around a normative definition of “success” in asset recovery to mean that restitution is bestowed upon the population from whom these assets were originally extracted. Chapter 1—situated in the context of postcolonial statebuilding—develops a theoretical framework on illicit forms of extraction, which leads us to the contemporary legal terms under which illicit enrichment is defined. Chapter 2 distills a comprehensive map of the procedures and actors under which conventional asset recovery operates, then, crucially, draws attention to the cases it excludes. Within this category lies the Democratic Republic of the Congo, Tunisia, and Equatorial Guinea, each analyzed as comparative case studies by which cautionary lessons or innovative approaches instruct the fourth and final case study: Libya. As the country with the most wealth at stake and the least reported success in reclaiming it, Libya stands out as a unique and urgent focal point of this research. Expert interview research I conducted with representatives from private, NGO, and state-based asset recovery agencies in Switzerland informs the normative and geographic scope of this thesis.