Libya detains hotel development executive over massive fund misuse allegations

Libya’s Attorney General, Al-Siddiq Al-Sour, has ordered the detention of the head of Oran Bay Hotel Development Company, a subsidiary of the Libyan Foreign Investment Company (LAFICO), as part of a major investigation into alleged misappropriation of funds tied to a stalled renovation project.

The probe centers on the redevelopment of the former Sheraton Hotel, now known as the Oran Bay Hotel, which has been plagued by corruption.

Despite an outlay of 70% of the allocated budget, only 2% of the project has been completed, raising serious questions about the mismanagement of public funds.

The prosecutor’s office revealed extensive financial irregularities during the investigation, including an unjustified payment of €34.5 million to a construction contractor and €2.78 million to a consulting firm.

Moreover, costs for renovation were egregiously inflated, with the estimated cost per room reaching €275,548—far surpassing the industry standard of €80,000 per room.

This case has spotlighted the endemic corruption issues Libya continues to grapple with, as authorities move to hold those responsible accountable.

In response to the evidence showing blatant abuse of power and embezzlement for private gain, the prosecutor’s office ordered the executive’s provisional detention as the inquiry proceeds.

The Oran Bay scandal underscores the challenges Libya faces in ensuring transparency and accountability within its state-linked enterprises, particularly as it seeks to rebuild and attract investment following years of conflict.

The country remains under pressure to root out corruption that threatens its economic recovery and development efforts.