The businessman squints from the photograph, his sparse beard framing a slight smile that lends him an enigmatic air. It's the same expression captured in the photos that have accompanied scores of magazine and newspaper articles on Rafik Abdelmoumèn Khalifa's spectacular rise as an international financier and jet-setter who hung out with celebrities like Bono, Pamela Anderson, Sting and Gérard Depardieu. But this particular shot of the Algerian tycoon is featured in a picture of a different kind: a mug shot on Interpol's Wanted list, where it was placed by Algerian authorities seeking to prosecute Khalifa for alleged crimes linked to the rise and fall of his €1 billion empire.

When Algeria issued an arrest warrant last month for its only home-grown international business titan, it marked the most recent slide in Khalifa's long-plummeting fortunes. Once considered a hero and source of hope for Algerian youths, Khalifa is now sought by police for suspected criminal mismanagement and money laundering at the Khalifa Group, his banking, transport, television and construction conglomerate, which went belly-up in July.

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nginx/1.14.0 (Ubuntu) Khalifa is thought to still be holed up in the luxurious London hotel room he moved into in May, when his crumbling businesses inspired him to leave his Paris offices for the U.K. — which conveniently has no extradition accords with Algeria. He broke his silence briefly, to call charges of irresponsible and illegal management "absolutely false." Meanwhile, average Algerians are blaming the boyish financier, who is known as "Moumen," for causing the loss of over 20,000 Khalifa Group jobs; hundreds of thousands of other Algerians will never get back their Khalifa bank accounts. "Moumen's growing success, fame and fortune was so amazing, it gave many Algerians hope that 'finally, we can have the good life, too,'" comments Waël Hasnaoui, an Algerian working in Paris as an advertising consultant, and a member of Khalifa's original social circle. "In fact it was incredible — literally. His entire business ascent was obviously too beautiful to be true, and his eventual failure was absolutely predictable."

In a state-stifled economy where unofficial unemployment estimates are close to 40% and corruption is rife, it's understandable why many Algerians chose to view the 36-year-old Khalifa as a national dream come true. His biography holds that in 1991 — using around €1,500 in capital — Khalifa exploited experimental liberalization of select sectors in Algeria's state-dominated economy to make a fortune selling 15 generic drugs out of a modest, family-owned pharmacy in Algiers. The experience taught Khalifa how lucrative supplying inexpensive goods and services to an unsatisfied market could be. In 1998, using €6 million in capital from his pharmacy business, he began constructing his Khalifa Group empire that within three years boasted €1.7 billion in annual sales and €200 million in profits.

Flush with success and cash at home, Khalifa expanded his domestic airline business to Europe, Africa and the Middle East, and launched European car-rental units. He also indulged his social ambitions by organizing celebrity-studded receptions and junkets to Algeria, sponsoring pro sports teams and founding satellite TV channels based in London and Paris. Last September, Moumen launched his French Khalifa TV from his €36 million villa in Cannes. But the image began to fray when Khalifa TV's brief time on the air featured tacky, uninspired programming. On July 2 Khalifa TV's debt and insolvency led a French commercial court to order the company liquidated. It was a fate Khalifa Airlines' French unit also met eight days later, a mere formality, because last May the airline had halted all service, after leasing companies repossessed Khalifa's 34 jets for lack of payment.

But even before the Khalifa Group began collapsing, alarms had been sounding whenever someone tried to make sense of the privately held firm's books. The first warning concerned El Khalifa Bank — Algeria's largest private bank — which attracted over 1 million private and institutional clients with interest rates paid on accounts of up to 17%. Last November, acting on suspicions that money deposited in El Khalifa Bank savings accounts had been pumped to finance the empire's breakneck expansion, Algerian regulators prohibited Khalifa from transferring money abroad. With good reason: in February, three close Khalifa associates were caught leaving Algeria for Paris with €2 million in suitcases — money destined for cash-deprived Khalifa affiliates in Europe. One week later, the Bank of Algeria appointed administrators to oversee El Khalifa Bank's operations, citing multiple "irregularities."

Khalifa's rapid access to suspiciously abundant capital and his habit of hiring unqualified family members of Algeria's ruling class led many observers to suspect another agenda. As early as last October, for example, a leaked French intelligence report estimated the conglomerate's annual losses at about €500 million and fueled suspicions that Khalifa's empire had been assembled with — and used to launder — money embezzled by corrupt officials in Algeria's military-backed government.

"Neither Moumen or any of the people hired had any authentic business experience, which is why they spent group money recklessly as though it was their own," says Hasnaoui, who turned down a job offer from a Khalifa Group company. "This company was a fantasy creation by and for an Algerian élite — an artifice certain to collapse."

That fantasy apparently duped the vast number of Algerian account holders who parked their savings in Khalifa's now-ruined banks. The majority of accounts were opened by Algerian state administrations and public companies — taxpayer money that vanished in Khalifa's high-spending business expansion. The remainder was entrusted to El Khalifa Bank by private individuals — personal savings accounts the government will cover only up to €9,200. While Moumen's spectacular ascent may have been a vicariously wild ride for Algerians while it lasted, the Khalifa crash and burn is a calamity they'll be paying off for decades to come.

• BRUCE CRUMLEY | Paris
• Once a golden boy of business, Rafik Abdelmoumèn Khalifa is wanted by the police