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THE BOTTOM LINE The payments netted in Saudi Arabia’s
anticorruption purge could be used to help an economy that’s been
suffering from the 2014 drop in oil prices.○Althoughtheformerpremierisbannedfromholdingoffice,
hecouldemergeasthepowerbehindanewgovernmentWill Italy Dance Again
To B e r l u s c o n i ’ s B e a t?
On a Monday morning just before Christmas, Silvio
Berlusconi walked into an elegant salon inside
his villa near Milan to complete preparations for
a major shift in his political strategy. Beneath a
grand oil painting of the Italian aristocrat who
once owned this villa in Arcore, Berlusconi advis-
ers huddled around a table discussing social
media, according to senior members of his cam-
paign team. Projecting laptop data onto a largescreen, the team talked the 81-year-old TV mogul
and former Italian prime minister through likes,
followers, and potential lines of attack as they put
the finishing touches on a three-month project
to transform his political operation into a digital-
savvy venture aimed at young people.
Six years after he was forced from office at the
height of the euro zone crisis, Berlusconi is back.
The four-time premier is banned from holdingThe purge, led by Crown Prince Mohammed
bin Salman, the 32-year-old son of King Salman,
began without notice on Nov. 4, as authorities
swept across the country rounding up hundreds
of suspects, including some of the most prominent
citizens. Prince Alwaleed bin Talal, considered
the richest man in Saudi Arabia, was detained, as
was former Finance Minister Ibrahim Al-Assaf and
Adel Al Fakeih, who was removed as minister of
economy and planning on the eve of the arrests.
Prince Miteb, son of the late King Abdullah and
minister of the powerful National Guard, was held
and then released a few weeks later after agreeing
to pay more than $1 billion.
News of the purge reverberated across board-
rooms, financial markets, and world capitals as
bankers, analysts, and diplomats sought to assess
its impact on the biggest Arab economy. Stocks
in companies owned by detainees slumped.
Although Saudi Arabia is trying to become more
open, the probe was conducted in a “pretty non-
transparent way,” Moritz Kraemer, global chief
rating officer at S&P Global Ratings, said in a
Jan. 22 interview on Bloomberg Television. The
probe “could be a step in the right direction, but
it could also be a step towards more arbitrary
ruling,” he said.
Saudi officials say Prince Mohammed had to
tackle graft as he tries to revitalize the economy
by weaning it off oil. “Corruption had reachedepidemic proportions,” says the senior official. “It
was as if the nation woke up and realized there
was good news and bad news: The bad news was
that it had cancer. The good news was that it’s
treatable, but we have to go through surgery, che-
motherapy, radiation, and amputation.”
One of the biggest mysteries is the fate of
Alwaleed. Three people following his case say he’s
left the Ritz and wasn’t in prison—rather, he was
held at another location as he negotiates an agree-
ment. Three others, however, say he’s still at the
hotel. In December two people with knowledge
of the matter said Alwaleed was balking at steep
financial demands that would force him to give up
control of his $9 billion holding company.
Bloomberg was unable to meet with detainees
or to verify the attorney general’s claims that all of
them were allowed access to legal counsel. Two
people who’ve spoken to some of them say not
everyone was given access to lawyers or let out of
their rooms except for questioning. Al Mojeb denies
the suspects’ rights were violated and says the anti-
graft committee wants to exhaust all options that
can lead to a settlement before referring anyone to
prosecution. Still, the message is clear. “We are in
a new era,” Al Mojeb says. “The campaign against
corruption won’t stop.” —Alaa Shahine“Those
who express
remorse and
agree to settle
will have
any criminal
proceedings
against them
dropped” POLITICS Bloomberg Businessweek January 29, 2018