Investigations into Samherji’s Namibian operations finalized

Published on
July 30, 2020

Samherji’s board of directors have confirmed receipt of an investigation report produced by law firm Wikborg Rein, which explored the strong allegations of bribery and other illegal practices made against the Icelandic fisheries company's operations in Namibia. It will look to make some of the report’s findings public in due course.

As previously reported by SeafoodSource, allegations were directed at Samherji and the company's operations in Namibia in November last year. At that time, WikiLeaks published thousands of documents claiming to expose corrupt schemes by the company to gain access to rich fishing grounds in the country.

The board mandated Wikborg Rein to assist Samherji in its investigation into the relevant facts. The subsequent eight-month investigation saw the Norwegian firm analyze more than 1 million documents and interview many personnel. At the same time, forensic accountant firm Forensic Risk Alliance (FRA) was engaged to analyze payments and other transactions related to the Namibian business.

In a statement published on 29 July, on receipt of Wikborg Rein’s final report, Samherji Chairman Eirikur S. Johannsson said that from the outset, the board knew that some of the allegations were “outrageous and without basis in reality.”

He explained that one such example related to the German-owned crewing company Cape Cod, which was mainly used to pay wages to crews in several countries, but portrayed in the media as having been a vehicle for a variety of illegal purposes in relation to Namibia.

“We were further deeply offended by the portrayal of Samherji having exploited a developing nation and walked away with large profits. The total taxes paid in Namibia over the years by entities Samherji was invested in, including income tax, employee tax, export levies, import levies, social security and a number of other payments made to the Namibian state, were about ISK 4 billion (USD 29.6 million, EUR 25.2 million). That is remarkable in itself considering that Samherji's operations in Namibia were ultimately unprofitable/loss-making,” Johannsson said.

“Other allegations concerned facts about a small part of our global operation in a foreign culture, far from Iceland, where we saw a need to have external assistance mapping the relevant facts for us. The alleged facts were simply unknown to us and needed to be scrutinized. So having been faced with serious and fragmented allegations it was very helpful for the Samherji board to receive Wikborg Rein's comprehensive and balanced review of the relevant facts over the years of operation in Namibia,” he added.

Johannsson revealed that “to get to the bottom of the relevant facts” Samherji had spent “vast internal and external resources,” but that it was important to the company to display to its stakeholders that it takes such allegations seriously.

The statement explained that once Wikborg Rein has met with the relevant authorities, there will be a number of considerations to be taken into account in terms of what findings can be made public, and whether publishing certain information will jeopardize ongoing investigations elsewhere or infringe upon laws and regulations concerning the protection of individuals mentioned.

“We have a need to comment in more detail on the contents of the findings and to rebut allegations that we reacted strongly to when they were made against us last year,” Johannsson said. “We have respected the integrity of the investigation and left many allegations publicly unanswered despite an urge to comment on them. We equally respect the integrity of still ongoing public investigations. But we will in the coming weeks take a stronger and more vocal stand publicly also in relation to concrete details. Samherji firmly denies that its management ever intended for any subsidiary to engage in wrongful activity, including bribery or money laundering, in order to achieve benefits and will rigorously rebut any further allegation to this effect.” 

Earlier this month, the company faced claims by investigative journalism training project Finance Uncovered that it had appeared to have reduced its taxable profits in Namibia by sending hefty fees to its companies in other jurisdictions. The article, “A fishy business: shifting profits out of Africa,” was criticized by Samherji, which cited many factual errors as well as recycled, previously published material.

Samherji Co-CEO Björgólfur Jóhannsson stated that despite corresponding with Finance Uncovered over the past three months, many of its allegations showed “complete misunderstandings” of international business operations.

Samherji ceased all of its Namibian operations in 2019. In January this year, it launched plans to introduce a new company-wide compliance program.

Contributing Editor reporting from London, UK

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