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Government and Security Sector Accountability

Selling Electricity Case

Court / Presiding Judge

Alexandria Criminal Court/Judge Gamal Gomaa

Procedural History

In September 2014, the court issued its verdict in the case.

Verdict

Businessman Hussein Salem and his son and daughter were sentenced in absentia to 10 years in prison. Four other officials at the Alexandria Petroleum Company were sentenced to seven years in prison, and six individuals received one-year suspended sentences and a fine of LE11 million as well as a repayment of LE125,000 to the state.

Summary of Reasoning

The court sentenced the defendants on charges of selling electricity to bodies other than the Egyptian Electricity Authority, causing willful damage to their employers, and violating the law that prohibits Egyptian and foreign investors from selling electricity to bodies other than the Egyptian Electricity Authority.

Anecdotal Notes

While Hussein Salem relinquished funds in a reconciliation deal with the Egyptian government that was finalized in August 2016 and in which he reportedly paid LE5.8 billion in order to avoid prosecution, it has been suggested that the total value of his assets far exceeded the amount he reported during the reconciliation process. In December 2018, the Illicit Gains Authority began an investigation into Salem's hidden assets after the Administrative Control Authority found records within Salem's companies showing transfers of funds between various companies in what was perceived to be an attempt to hide these funds from the government.

Legal & Judicial Implications

While the court issued both a prison sentence and fine to the Salem family and its affiliates in this case, there is fear that the reconciliation deal that Salem reached while another one of his cases was ongoing sends an implicit message that the judiciary’s corruption sentences can be sidestepped in exchange for payment, thus contributing to a culture of impunity for government officials implicated in corruption cases and creating an environment in which individuals with access to wealth can avoid prison sentences.