Court jails and dismisses head of Libya Investment Authority

A court in southern Tripoli has sentenced the chairman of the Libyan Investment Authority (LIA), Ali Mahmoud Hassan, to one year in prison and ordered his dismissal from office, following a case brought by the institution’s former head, Dr Mohsen Derregia.

The ruling stems from Mahmoud’s failure to implement a final and binding judicial decision in Derregia’s favour. The court found that the refusal to enforce the ruling constituted a breach of legal obligations and warranted criminal sanction.

The LIA has rejected reports of the judgment, stating that it has not received any formal notification confirming the issuance of a ruling in absentia against its chairman in his official capacity. It described the circulation of the decision as part of what it termed “suspicious attempts” to undermine the institution’s reputation both domestically and internationally.

Derregia, however, maintained that the ruling is valid and criminal in nature. He said the case concerns Mahmoud’s refusal to implement enforceable court decisions that are no longer subject to appeal, stressing that the judgment provides for imprisonment and removal from office rather than financial compensation.

He added that references in the LIA’s statement to compensation claims were unrelated to the criminal case and are being examined separately by the courts. According to Derregia, presenting the matter as a compensation dispute is misleading and does not affect the validity of the ruling.

Derregia also stated that the judgment had been issued several months ago and that the relevant authorities, including the state litigation department, had previously notified Mahmoud of the obligation to implement the ruling. He said such correspondence dates back more than four years.

He argued that continued non-compliance with a final judicial ruling leaves no room for reinterpretation through institutional statements, emphasising that court judgments are binding and cannot be overridden by administrative interpretation.

The legal basis for the ruling is set out in Article 234 of the Libyan Penal Code, which provides for imprisonment and removal from office for any public official who abuses their authority to obstruct the implementation of laws, regulations or judicial rulings. The same provision applies to any official who deliberately refuses to implement a court order within their jurisdiction after ten days from formal notification by a court officer.

For its part, the LIA challenged the basis of Derregia’s claims, stating that he was removed from his post in 2013 and received all financial entitlements in accordance with official records. It added that he has since pursued further legal claims seeking additional compensation.

The authority pointed to a previous ruling by the Misurata Court of Appeal awarding Derregia compensation of 15 million Libyan dinars, noting that the decision has been appealed before the Supreme Court on procedural grounds after one of the presiding judges declined to sign the judgment.

It also confirmed that it has filed a case before the Tripoli Court of Appeal contesting Derregia’s legal standing and entitlement to compensation. The LIA cited subsequent decisions appointing new boards of directors, which it said had been legally reinforced, as well as Derregia’s alleged holding of a foreign nationality, which it argued would disqualify him from holding the position.

The case follows a series of legal disputes over the leadership of the authority. In January 2023, Libya’s Supreme Court rejected a request by Mahmoud to suspend a ruling by the administrative courts of appeal in Tripoli ordering the reinstatement of Derregia as chairman and chief executive of the LIA.

A source cited at the time said Mahmoud had exhausted all legal avenues and had been advised that the ruling was final and must be implemented. Reports also indicated that his relationship with Abdul Hamid Dbeibeh had been marked by disagreements.

Derregia was appointed to lead the LIA in April 2012, taking charge of a sovereign wealth fund valued at more than 67 billion US dollars. During his tenure, he commissioned an asset survey and valuation project by Deloitte and a strategic review by Oliver Wyman as part of efforts to assess the fund’s holdings and strengthen its governance.

Established in 2006, the Libyan Investment Authority manages Libya’s surplus oil revenues and remains one of Africa’s largest sovereign wealth funds. Parts of its assets have been subject to an international freeze since 2011.

The developments mark the latest chapter in a protracted legal dispute within Libya’s sovereign wealth fund, raising renewed questions over governance, judicial enforcement and institutional legitimacy.