By AfricaHeadline – June, 2025
TRIPOLI — Millions of dollars frozen in U.S. banks are reigniting the fierce struggle for political dominance in Libya. As promises of national reconstruction collapse under the weight of competing interests, the vast hidden fortune of former dictator Muammar Gaddafi has become the fuel behind a new silent war — one defined not by tanks, but by threats, betrayals, and covert operations.
Over a decade after his death in 2011, Colonel Muammar el-Gaddafi continues to haunt Libya’s fragile institutions, not through fiery speeches, but through an estimated $50 billion in shadow assets, held across the United States, Europe, and offshore tax havens.
Much of this wealth remains unclaimed and entangled in complex legal structures. Now, it lies at the heart of a brutal power struggle among Libya’s rival factions.
Confidential documents obtained by AfricaHeadline reveal that a significant portion of Gaddafi’s financial empire has been traced with help from U.S. and Swiss authorities.
However, international law requires that any release or transfer of those funds must be processed through a unified and internationally recognised Libyan government, something the fractured nation has failed to produce since 2011.
“It’s not just about the money — it’s about controlling Libya’s political future,” said a former UN diplomat, speaking anonymously. “Whoever controls Gaddafi’s fortune, controls the narrative of Libya’s reconstruction.”
At the centre of the recovery efforts is Dr. Mohammed al-Mansali, Director-General of Libya’s Asset Recovery and Management Office (LARMO). In January 2025, he was detained for three months, accused of corruption, charges widely believed to be politically motivated.
Following his release in May 2025, Dr. Mansali reportedly received multiple death threats. On 16 June, sources close to the case confirmed that he had gone into hiding after narrowly escaping a kidnapping attempt in Tripoli.
“He was getting dangerously close to recovering major assets,” said a European investigator. “That made him a direct threat to those who have long benefited from this hidden wealth.”
Despite the fact that billions remain frozen in American institutions, the U.S. has kept a low profile in the matter, citing diplomatic sensitivities. However, Freedom of Information Act (FOIA) records show that at least $8.7 billion is currently held in dormant accounts since 2011.
Notably, suspicious movements were detected in 2022 and 2023, routed through shell companies in Delaware and the British Virgin Islands.
Global anti-corruption watchdogs have urged the Biden administration and Congress to open a formal investigation into potential fraud schemes, warning that the funds could “fuel another generation of conflict if left unchecked.”
On 9 June 2025, the U.S. Congress received a classified briefing assessing the risks of releasing such funds without a unified Libyan authority. Lawmakers agreed to maintain the freeze until further institutional guarantees are established.
In early June 2025, the United Nations Security Council approved a request by the Libyan Investment Authority (LIA), under chairman Ali Mahmoud Hassan, to unfreeze small amounts for urgent development projects.
On 16 June, multiple sources confirmed that Dr. Mansali was under international protection protocols after a direct threat to his life.
Analysts say the bulk of Libya’s oil earnings from 1972 to 2023 — estimated at $1.25 trillion — was partly diverted into these shadow funds during Gaddafi’s 42-year rule.
Experts suggest a multilateral monitoring mechanism, possibly led by the UN, European Union, and African Union, to manage and audit any released assets. Legal pathways through U.S. courts, the ICSID, and international anti-money laundering protocols are also recommended to safeguard the funds.
“If handled poorly, this resource could become jet fuel for the next cycle of violence,” warned one senior analyst at Africa Confidential.
The fight for Gaddafi’s frozen billions reveals the deeper institutional vacuum plaguing post-revolution Libya. While intended for victim compensation and national recovery, the fortune now risks becoming a bargaining chip in a shadowy auction of influence, greed, and geopolitics.
With Mohammed al-Mansali in hiding and rival factions growing increasingly desperate, Libya once again stands at the crossroads between justice and collapse , and this time, the price is not oil, but memory and truth.
The delay in unlocking the assets, while legally justified, has also exposed a moral dilemma for the international community: how long can the world keep billions in limbo while hospitals in Benghazi crumble, infrastructure rots in Tripoli, and children in Sabha learn under tents? For many Libyans, justice delayed is development denied.
Critics argue that global inaction only deepens inequality. While elites negotiate behind closed doors in Geneva or Washington, average Libyans continue to face electricity cuts, food insecurity, and political paralysis.
The longer these funds remain frozen or mismanaged, the more they symbolize betrayal, not by a dictator, but by the post-revolution order meant to replace him.
There is a growing call for a new international compact, led by African institutions and civil society groups, that ensures any recovered money is held in trust for Libyan citizens, not recycled through corrupt networks. For that to happen, transparency must be non-negotiable, and accountability must be built into every transaction.
Ultimately, the fate of Gaddafi’s hidden wealth is more than a forensic investigation, it is a moral test for Libya’s transition and for the global financial system that once enabled its concealment. Whether this treasure becomes a tool for peace or another curse for the people of Libya will depend on decisions made in the coming months, both in Tripoli and beyond.
