Spain freezes assets of detained Mubarak associate

AP News
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Posted: Jun 17, 2011 11:32 AM
Spain freezes assets of detained Mubarak associate

Spain has frozen euro33 million ($47 million) in accounts held by a detained Egyptian associate of ousted president Hosni Mubarak and relatives of the detainee, who is also wanted back home, officials said Friday. Bail was set at euro27 million.

Hussein Salem, 77, his son Khaled and an associate described as a frontman were arrested in a wealthy Madrid suburb. The money was allegedly obtained illegally in Egypt and sent to accounts in Spain held by Salem, his family and his business empire, the National Police said. Police also seized homes worth euro10 million ($14 million), including seven in the southern jetset resort of Marbella.

Salem appeared Friday before two judges: one handling the Spanish money laundering probe and another dealing with the international warrant under which Salem was arrested at the request of Egypt.

After undergoing questioning by the judges at the National Court, Salem was hospitalized in police custody with neurological problems. A court physician said Salem was not in good health, but the problem was apparently not life-threatening. The physician spoke on condition of anonymity because she was not permitted to speak publicly.

The two judges set bail for Salem at a total of euro27 million: euro12 million in the Spanish money-laundering case and euro15 million in the Egyptian extradition case.

For now, the two proceedings will go ahead simultaneously, and at some point in the future a decision will be made as to which takes precedence, a court official said.

Salem and his son also hold Spanish passports, this court official said on condition of anonymity in line with court policy.

Presumably this circumstance might help Salem argue against extraditing him to Egypt.

Lawyers for Salem who were present at the courthouse declined to comment or give their names.

Salem's son Khaled faces euro6 million in bail in the money-laundering case and the frontman, identified as a Turkish man named Ali Evsen, had bail set at euro18 million, according to a ruling late Friday afternoon from Judge Pablo Ruz, who is handling the Spanish money laundering probe.

One of the most secretive businessmen in Egypt, Salem is wanted in his country on charges of bribing Mubarak and his family and squandering public funds, Egyptian officials say.

His detention was seen in Egypt as a major step toward unraveling secrets of corruption throughout the reign of Mubarak; and possibly a key to locate and retrieve much of Mubarak's riches, believed to be stashed abroad at a time when the country's economy is depressed, months after the uprising. Some estimate Mubarak's holdings at tens of billions of dollars.

Salem left Egypt a week before Mubarak was forced to resign on February 11 after 18 days of protests. After Mubarak's ouster, the protesters continued to press for the prosecution of Mubarak and his cronies for what they say were years of abuse and corruption.

Salem was charged in Egypt last month along with Mubarak and the ex-president's two sons. Their trial is scheduled for August 3.

Salem is said to have won lucrative land and other deals, including exporting gas to Israel, because of his connections to Mubarak. The natural gas deal has come under severe public criticism.

Salem, an ex-army and intelligence officer, was a close associate of Mubarak from his early days in office three decades ago.

A National Police statement says the money frozen by Spain was funneled into Salem family and business accounts through a series of companies created by the Turkish frontman.

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Ciaran Giles in Madrid and Sarah El Deeb in Cairo contributed to this report.