Arrest of business tycoon Marouane Mabrouk sends shockwaves across Tunisia

The empire

The Mabrouk family is primarily made up of three siblings, with Marouane the youngest. He is also the son-in-law of the deposed president Zine El Abidine Ben Ali, the man in power when much of the money went missing that his successor is now trying to recover.

The Mabrouks run a diversified and extensively invested economic and financial empire spanning various sectors.

The responsibilities of the three brothers – Mohamed Ali and Ismail, alongside Marouane – are split along sector lines. Ismail is the Chairman of the Board of Directors of Banque Tunisienne Internationale and manages large food industry companies. Mohamed Ali oversees hotel, tourism, and construction companies, while Marouane manages insurance companies, technology, telecommunications, car sales, and retail operations.

The group employs more than 25,000 people, including managers, professionals, and workers, with the group's transactions exceeding €1bn ($1.1bn) annually, according to Jeune Afrique magazine.

The family owns around 40% of Banque Tunisienne Internationale, the most significant commercial bank in the country. The group also operates in the insurance automotive sectors, with exclusive sales rights for Mercedes-Benz, Jeep, Fiat, Alfa Romeo and Mitsubishi. It is also a major part of the food industry.

Its companies are active in the telecommunications sector through Orange, and in tourism, transportation, and aviation, owning some of the largest Tunisian hotels, including the Four Seasons. Alongside a presence in construction, it also runs the Monoprix and Géant retailers.

The arrest

On 16 November 2023, it was confirmed that an arrest warrant for Marouane was issued and that he was under investigation for "crimes of forming an alliance to attack property, money laundering, and participation of a public official with the intent of obtaining personal benefits and harming the administration."

The cases involve unlawful dealings in companies – particularly Orange – that the government seized after the fall of the late President Ben Ali. The suspicion of money laundering opens the door to freezing bank accounts, properties, and assets.

The IMF angle

Judicial authorities are moving towards appointing a "judicial custodian" to manage Marouane's companies. This measure allows for "the protection, management, control and improvement of the company's administration."

Local media said one of the first companies affected would be the Mediterranean Distribution Company Medis, owner of the Géant hypermarket located on the capital's outskirts, Tunis.

The legal moves to end corruption come as the government seeks alternative sources of national income from borrowing as it struggles to secure an agreement with the International Monetary Fund for a loan of $1.9bn.

Tunisia's 2024 budget is the first budget since 2013 prepared without the assumption of receiving a loan from the IMF, as Kais Saied's government refuses to back some of the reforms demanded by the IMF, particularly an end to some government subsidies.

Read more: Tunisia and IMF deal: Which way will the pendulum swing?

He has said that Tunisia does not need to borrow if it recovers funds embezzled at home and abroad by organisations close to the deposed regime. According to the government, there are 460 businessmen it calls upon to reconcile with the state by returning funds.

But there is concern among business figures and economic officials that the report the president used to prepare the amnesty laws – compiled by the Investigative Committee for Acts of Corruption and Bribery – dates back to 2011. It seeks the return of 13.5bn Tunisian dinars or $4.3bn

Successive arrests of businessmen – culminating in Marouane's incarceration, despite him being known as "the exception" – have stoked concern about the impact of the measures on the business climate in the country. With more and more detentions and a rising number of tax or audit measures, businessmen are leaving the country or seeking a dual nationality.

Top of form

The president tried to deliver a reassuring message days after the high-profile arrest during a meeting with Samir Majoul, the Chairman of the Tunisian Central Agency for Employers, on 23 November, saying that "the fight against corruption does not target businesspeople who operate in full compliance with the law."

But he stoked concern among influential owners of major economic groups in the private sector after he pledged to dismantle "rentier lobbies" and establish a "national economy based primarily on self-reliance and the creation of real wealth that benefits everyone based on social justice."

French links and fresh crisis

The Mabrouk group of companies is the centre of gravity for the Tunisian economy's French links, carrying the brands of parent firms.

It also employs a number of French managers, including Frédéric Béchasting, a former banker at the European Bank for Reconstruction and Development, who played a role in expanding the group's presence in the food industry in the Maghreb region, particularly in Libya and Algeria.

Marouane's arrest is not the first crisis faced by the group, which hit problems in 2009 and in 2011. But it bounced back to maintain its strength. Its member companies across various sectors consistently rank at the top in terms of transaction volume and profits.

But this new crisis threatens the continuity of the Mabrouk family's ownership of companies, real estate, assets, and funds.

Two hypotheses are being considered: The first involves confining the issue to the legal process and waiting for the long court and uncertain proceedings in Tunisia. The second is reaching a settlement agreement. And experts describe the figures mentioned by the president as astronomical.

Saied has implied that Marouane was willing to pay $1bn as far back as 2011. Saied will not back down on this amount and is also seeking 10% more each year since then, considering inflation. The former administrative judge Ahmed Swab calculated the amount at $2.5bn, or 8bn dinars.

Pay up or go down

Saied's reconciliation laws targeted at corrupt businessmen seek the recovery of $4.3bn in public money the president believes was embezzled and came into effect a year ago.

So far, the "Penal Reconciliation Committee", comprised of senior officials and judges and established to get the money back in return for amnesties over prison sentences, has recovered just $10mn. That's according to Walid Al-Arfaoui, the Tunisian Association for Supporting Fair Trials president, who is considered close to the committee.

This failure was acknowledged by President Saied, who moved on two levels to try and salvage the reconciliation process. The first involved a fundamental change in strategy, moving from a policy of incentives to a policy of intimidation.

The president's statements affirmed this new approach.

Last September, he accused those involved in the reconciliation process of hiding behind procedures. Saied gave two options to individuals he termed as corrupt: "Either pay or go to jail."

The second level of action is legal and procedural, intended to amend the law and revoke the authority it grants experts to determine the settlement amounts.

Meanwhile, several arrest warrants were issued, targeting prominent businessmen, including a former president of Étoile Sportive du Sahel, one of the country's biggest football clubs, and a major investor in the pharmaceutical industry.

The president and general manager of companies importing French cars, such as Peugeot, Citroën, and Opel, was also detained.

But Marouane Mabrouk's arrest was the most significant, as it marked the end of the legend that such a powerful man was, in effect, untouchable by the state.

Golden Boy bags a bride

Maroune Mabrouk, sometimes called the Golden Boy, is a descendant of a wealthy family originally from the Tunisian coast. The year 1996 marked a turning point for the family when Maroune became the son-in-law of then-President Ben Ali after marrying Cyrine, the youngest of his three daughters from his first wife.

A simple inventory process of the family's wealth before and after 1996 confirms that they benefited from Ben Ali's regime, like other families that have come to be known as the "group of rentier families" according to the description of the non-governmental organisation Alert,  which combats corruption and the rentier economy.

This was a time when, in the controversial words of the former European Union ambassador Patrice Bergamini in 2019, "a lobby of influential families controls key aspects of the Tunisian economy and prevents competition."

The World Bank noted in a 2014 report that President Ben Ali's family, in-laws, relatives, and close associates controlled about a quarter of the private sector's profits through a network of directly managed companies.

It estimated the number of companies affiliated with Ben Ali's family is 220, acknowledging that state intervention in industrial policy during the Ben Ali era was a cover to conceal rentier conditions.

Disastrous divorce

The Mabrouk family benefited from Ben Ali's regime and was one of its main pillars until 2009 when the family and the group faced their first crisis. According to a close associate who spoke to Al Majalla, Marouane entered into negotiations with Ben Ali in early 2009 for a "divorce agreement" from Cyrine.

That sparked a disagreement so serious it almost destroyed the group, not least because its network of companies came under intense tax audits. These audits were aimed at destroying businessmen who fell into disfavour or at least forcing them into partnerships or takeovers.

There are many accounts of this period, including that the Mabrouk family sought international entities, notably from France, to complain about Ben Ali's intention to transfer more than two-thirds of their wealth to his Cyrine as part of the divorce settlement.

A family source family told Al Majalla that Marouane regained influence in presidential circles just days before the regime fell on 14 January 2011.

This was also reported by the French newspaper Le Monde, which published an exclusive document from the investigation with the director general of the Presidential Guard during Ben Ali's era, General Ali Seriati. In the document, Seriati stated that Marouane was the link between President Ben Ali and the French government during the revolution.

Two months after Ben Ali's fall, the first transitional government after the revolution issued a decree seizing 550 real estate properties, 48 ships and yachts, freezing 367 bank accounts, and about 400 companies, all affiliated with the Ben Ali family, including the Mabrouks. The list of those affected by the confiscations included 12 individuals.

Marriage of convenience

The post-revolution decade in Tunisia is described as the decade of the "marriage of convenience" between politics and money.

Most businessmen, including Marouane, saw opportunities to establish connections with Tunisia's decision-makers and new leaders. Numerous official reports revealed suspicions of collusion and manipulation in the procedures related to confiscated properties. These reports were made public, including a report from the Control Committee, a state entity, and another from the Court of Accounts.

Marouane is accused by some opposition parties of extending his influence over state institutions by funding political parties, organisations, and the media. The Alert non-governmental organisation accuses him of enjoying political immunity and having influence within the judiciary due to his proximity to the ruling parties, especially Ennahda and Tahya Tounes.

The International Crisis Group in Belgium confirmed that 300 individuals remain in control of state institutions in Tunisia and that businessmen who finance the election campaigns of some political parties directly influence the appointment of ministers, ministers of state, and administration personnel.

The shockwaves running through Tunisia since the arrest may soon ripple beyond the business world. The country will be watching closely.