Seychelles bombshells by the seashore.
The African nation has become a focus of Robert Mueller’s Russia meddling probe because of an early 2017 meeting between defense contractor Erik Prince and a Russian official.
That meeting is drawing new attention as the special counsel reportedly has information that the encounter was to set up a backchannel between Russia and the Trump transition.
Lebanese-American businessman George Nader, who helped set up and attended the meeting, is now cooperating with Mueller’s probe, according to reports.
Prince has said he had a brief run-in with Kirill Dmitriev by chance while meeting with United Arab Emirates officials in Seychelles in January 2017.
It wouldn’t be surprising that so many international players would be visiting the archipelago of 115 islands.
Seychelles has been a tourism magnate since its airport opened more than 45 years ago — and it’s also known as a haven for offshore banking.
Hospitality blossomed across the island nation after it won independence from the United Kingdom in 1976. The industry employs 15% of Seychelles’ workforce and brings in about $600 million per year, according to its government.
The islands are a favorite for high-profile tourists. Prince William and Kate Middleton spent their honeymoon on Seychelles’ North Island after their 2011 wedding.
The archipelago — located in the Indian Ocean about 1,000 miles off the shore of Somalia — didn’t have human settlers until the 18th century.
France first set up on the island in the 1750s, but lost control to Great Britain by the end of the century. France later regained control of Seychelles, but Great Britain won it back at the end of the Napoleonic wars.
Leaders have tried expanding Seychelles’ economy beyond tourism, with a focus on fishing and farming in recent years.
Seychelles’ tuna canning plant is a major economic driver and is half-owned by Heinz.
Banking in Seychelles — which has nearly 94,000 residents — has also come under fire for questionable practices.
Regardless, the country turned to the International Monetary Fund after a downturn in 2008, undergoing three successive programs with the bank. The IMF approved a three-year economic reform deal with the country, which it said no longer need to borrow funds.
Seychelles was one of several nations where former Trump campaign chair Paul Manafort was recently accused of laundering money.
Al Jazeera featured the country’s offshore practices in a 2012 story, spotlighting “the clever but brazen tricks and scams that can be used (for a fee) to disguise the origins of money and the identities of those who are moving it around.”
The offshore banking industry has been credited with making Seychelles one of Africa’s richest nations and fueled allegations of corruption within the government.
Advice blogs specializing in offshore finances also warn about lax oversight in Seychelles — not requiring adequate records or subject to audits.
But leaders in the nation argue most of the offshore banking is legitimate, regardless of some bad actors who are protected by a corrupt government.
Paul Chow, a former lawmaker and Seychelles businessman, told the International Consortium of Investigative Journalists in 2014 that the nation was successful because it stood up to groups like the Organization for Economic Cooperation and Development, while neighboring Mauritius buckled under the organization’s pressure.
“Mauritius made the mistake of following the rules,” he told the publication. “Whatever the OECD said, they followed, so that actually killed their offshore corporations.”
He likened the nation’s practices to Delaware limited liability corporations, a lucrative type of U.S. shell company often scrutinized as a tax haven for shady business practices.
OECD had branded the nation non-compliant by that time, but in 2015 reportedly said the nation was abiding by its guidelines.
Seychelles’ banking practices were back in the news in 2016, however, because Mossack Fonseca, the law firm at the center of the Panama Papers, has an office there.
The country’s Financial Services Authority expressed concern after the damning Panama Papers were leaked because it could tarnish Seychelles’ reputation.