In December 1990 The Wall Street Journal published a long front-page story about Jacques de Groote, a “suave and erudite” 63-year-old Belgian economist who was one of the most senior of the 22 executive directors of both the World Bank and the International Monetary Fund in Washington DC.
It reported that he “lives in a style that suggests substantial wealth … he has long been something of a bon vivant, with a taste for the finest in clothes, restaurants and residences. He has a $1 million townhouse in the Georgetown section of Washington, a $2 million working farm in Italy and a $1 million apartment in Brussels.”
It quoted a friend saying: “De Groote is an eccentric … He will go to a shop and buy 20 shirts, six pairs of shoes, flashy ties. He loves the finer things in life.” All this while facing what a Belgian court described as “serious financial problems” — namely debts totalling $1 million.
De Groote with his wife arriving at court in 2013
ALAMY
Where did his money come from? The suspicion, the Journal said, was that he was on the payroll of Mobutu Sese Seko, the deeply corrupt dictator of Zaire, the former Belgian colony now called the Democratic Republic of Congo. De Groote denied the charge.
The report noted that over two decades he had informed Zaire of the World Bank and IMF’s confidential negotiating strategies for granting that country’s regime aid packages worth hundreds of millions of dollars, and that Zaire had generally secured those packages despite its manifest corruption and huge debts.
At one point de Groote had visited Mobutu at his villa in the south of France to advise him on IMF business, the Journal said. At another, he had flown to Zaire to discuss its tattered relations with the IMF. In 1989 he had actively promoted a $211 million IMF loan plan for Zaire “despite worsening Zairian corruption, government misspending and economic decay”. Within months, the reform plan on which the loan was predicated had proved “a shambles”.
De Groote performed those services for Zaire even though it was not one of the countries that fell within his remit. But as an IMF and World Bank director, he was governed by no rules, no code of conduct. “He involves himself in the affairs that he chooses, rendering advice as he sees fit while helping to channel the $25 billion or so in international aid the organisations annually dispense,” the Journal wrote. “It is a position of much autonomy, with wide freedom from interference or scrutiny.”
The Journal cited other ways de Groote had benefited from his ties to both Zaire and neighbouring Rwanda, another former Belgian colony. He had run up sizeable personal debts, but was bailed out by assorted Belgian friends including Baron Jean-Louis van den Branden, who owned a mining and real estate company that operated in Zaire and Rwanda.
De Groote sought unsuccessfully to get the baron’s cash-strapped company $30 million in financing from a World Bank affiliate. Rather more successfully, he urged Rwanda to devalue its currency at van den Branden’s behest. De Groote survived the Journal’s investigation, but continued to live dangerously.
After leaving the World Bank in 1991, and the IMF in 1994, he became president of a Swiss-registered company called Appian Group, which invested in central and eastern European companies that were being privatised after communism’s collapse. One of those companies was Mostecka Uhelna Spolecnost (MUS), a big mining business in the Czech Republic.
He fell out with Alain Abdourahman, a Swiss financier who had lent him and his five secret Czech partners $533,000, which they used illegally to purchase MUS shares. Abdourahman sued de Groote to get the money back. The Swiss authorities investigated, and found that de Groote had used Appian to conceal the true identities of MUS’s purchasers.
In the ensuing trial in 2013 the five Czechs were imprisoned for money laundering and fraud, while de Groote was fined. The president of the court said he had “taken advantage of his excellent reputation”. His appeal against his conviction was upheld six years later, but he had paid a heavy price. His lawyer said his client, by then 86, hoped the ruling would “put an end to what has destroyed him psychologically and financially for so many years”.
De Groote said he’d had “stormy liaisons with well-known ladies”
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Jacques de Groote was born in the village of Klerken in the Belgian province of West Flanders in 1927, one of nine siblings and half-siblings. Two of his half-brothers fought in the resistance in the Second World War and died in Nazi concentration camps. He was educated by Benedictine monks in Zevenkerken, near Bruges, then read law, economics and political science at Leuven University, earned an MA from Cambridge and taught at universities in Leuven, Lille and Namur.
In 1959, at the behest of the Congolese leader Patrice Lumumba, he was appointed secretary of a commission preparing for the Belgian Congo’s independence the following June, then moved to Washington as an assistant to Belgium’s representative at the IMF and World Bank.
In 1963 he joined the National Bank of Belgium. Three years later he became an economic adviser to Mobutu’s government and its national bank. It was de Groote who advised Mobutu to adopt “zaire” —meaning “river” or “big water” — as the name of its new currency, and Mobutu later adopted it as his country’s name.
In 1973 de Groote returned to Washington as Belgium’s executive director of the IMF and World Bank. Within those organisations he was responsible for the interests of six nations — Belgium, Austria, Luxembourg, Turkey, Hungary and what was then Czechoslovakia — but not of Zaire, which had its own executive directors.
That did not stop him from taking an active interest in Zaire’s affairs, an interest that he attributed to his personal commitment to that country and Belgium’s colonial ties to it. “I am not a Mobutu agent,” he told the Journal in that notorious 1990 article, though there is some evidence that his murky finances caused him to be overlooked for the governorship of the Belgian national bank.
As for his lavish lifestyle, de Groote admitted that he enjoyed the company of women. By then, the Journal reported, he was living apart from his wife, Jacqueline, the daughter of a former Belgian foreign minister with whom he is believed to have had a daughter. He acknowledged that he had “certainly had a number of women in my life … I had stormy liaisons with well-known ladies”.
Jacques de Groote, IMF and World Bank director, was born on May 25, 1927. He died on September 21, 2024, aged 97
