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A book “The Key Man: The True Story of How The Global Elite was Duped by a Capitalist Fairy Tale” authored by Simon Clark and Will Louch has claimed that a Pakistani named Arif Naqvi fooled billionaire Microsoft co-founder Bill Gates of around USD 100 million.
Naqvi was once the head of private equity firm The Abraaj Group was a pioneer in the field of impact investing, which sought to make money for investors while doing good for the world. However the book claims that he was a conman who used to fool super rich people.
Naqvi used to spend time with super rich and powerful people, including Bill Gates, Bill Clinton, and former Goldman Sachs CEO Lloyd Blankfein.
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Born in 1960 in Pakistan’s Karachi, Naqvi pursued studies at Karachi’s highly selective grammar school and then went to the London School of Economics.
In 2003, Naqvi established Abraaj while announcing his intention to invest in ways that would help conquer global poverty. He raised $118 million, much of it from “Middle Eastern governments, royals, and traders.” for establishing private equity firm.
Naqvi was invited by President Barack Obama, along with 250 other Muslim business leaders, to a Presidential Summit on Entrepreneurship in 2010 where he delivered a speech on importance of impact investing stating that “It can only happen through entrepreneurship.” Two months later, the US government invested $150 million in Abraaj.
“Arif gave millions of dollars to universities around the world, including Johns Hopkins University in the United States, and the London School of Economics, which named a professorship after Abraaj,” the authors write. “Following in the footsteps of billionaire philanthropists like Bill and Melinda Gates, Arif started a $100 million charitable organization called the Aman Foundation to improve health care and education in Pakistan.”
He however enjoyed a luxurious lifestyle, flying around on “a private Gulfstream jet with a personalized tail number — M-ABRJ — and sailed on yachts to meet new investors who could help increase his fortune.”
By 2007, Naqvi had moved into “a palatial new mansion in Dubai’s luxurious, gated Emirates Hills district . . . known as the Beverly Hills of Dubai.”
Naqvi regularly attended Davos and similar conferences, where he befriended the likes of Bill Gates and other billionaires.
“Bill and Arif had much to discuss,” the authors write. “They agreed that their charitable foundations would work together on a family planning program in Pakistan. Arif seemed to be precisely who Bill was looking for. He was wealthy and concerned for the poor.”
Gates Foundation granted USD 100 million to Naqvi for investment in hospitals and clinics in emerging markets. Following this Naqvi was able to raise around USD 900 million from other investors.
“This is a significant co-investment partnership,” Gates said about the deal. “It is also an example of the kind of smart partnerships that hold huge promise for the future.”
In reality, Naqvi had already started misusing the money with a “secretive treasury department” that not even most of his employees knew about, the authors write.
“Abraaj was really made up of a tangled web of more than three hundred companies based mostly in tax havens around the world.”
Though Abraaj Capital had to maintain a certain amount of money (in millions) in a bank account, as per the regulations, the said accound was usually close to empty. The authors further write that money would be transferred into the account only around end of each quarter when the firm had to report to the regulator. Later the account would be emptied again.
Naqvi’s downfall was triggered by one of his employees who in 2017 sent an anonymous email highlighting his misdeeds.
After Naqvi’s employee wrote the email, a forensic accounting team was hired by Gates Foundation to investigate Abraaj’s books. “Bill shifted uncomfortably in his seat and pursed his lips,” the authors write. “Whenever Arif attempted to make eye contact or engage him in conversation, Bill looked the other way.”
Finally, Naqvi was accused by US prosecutors of running a criminal organization and he was arrested on April 10, 2019 at London’s Heathrow Airport. He remains under house arrest in London as a decision on his appeal is awaited. He has also “maintained his innocence” despite the paper trail pointing at his misdoings.
His shocking story serves as a cautionary lesson to the rich — but gullible — investors seeking to address world poverty.
The authors have written that the poor people, would have benefited more if Naqvi had just thrown the money from atop a highrise and let the wind scatter the dollar bills across the city.