Thursday, January 27, 2022

Spanish court targets Chilean bank linked to Pinochet

MADRID – Nearly 15 years after the death of former Chilean dictator General Augusto Pinochet, victims of his brutal regime are still trying to hold him and his associates accountable. And now the victims seem to be one step closer to justice – even if the courtroom is on the other side of the world.

This month, the Supreme Court in Chile was notified by the National Court in Spain that an investigation had been reopened in Madrid into whether a bank, Banco de Chile, helped General Pinochet and his associates launder millions of dollars abroad, according to court documents which was sent. to the attorneys in the dispute.

The plaintiffs are led by the President Allende Foundation and represent more than 20,000 victims of the Pinochet dictatorship. The focus of the legal effort was on funds presumably expropriated by General Pinochet and his associates and transferred to personal foreign accounts, according to which the plaintiffs were also acts of tax evasion and money laundering.

Spain was chosen for the lawsuit because it has been pioneering the past three decades in holding autocrats worldwide responsible for their crimes in jurisdictions other than their own countries.

While General Pinochet died in house arrest in Chile in 2006 without ever being tried, he was detained in Britain in 1998 by order of a Spanish judge, Baltasar Garzón, who could not then convince the British government to extradite him to Madrid. does not deliver. Britain instead allowed him to go home because of his poor health. In 2011, a Chilean commission investigating torture, kidnappings, murders and other human rights violations during the general’s dictatorship identified more than 40,000. victims.

For years, the Banco de Chile has successfully argued that Chile, rather than Spain, has the jurisdiction to investigate the Pinochet – related activities. But in Chile, the judiciary concluded a money laundering investigation in 2013 without charging the general or anyone else. According to a study commissioned by the Chilean Supreme Court, only $ 2 million of the $ 21 million identified as General Pinochet’s personal fortune can be considered clean money.

Finally, in 2018, the Supreme Court of Chile ordered that General Pinochet’s assets be repaid $ 1.6 million, while sentencing three of his former generals for fraud involving public money. Banco de Chile has never been charged with money laundering in Chile, but it paid $ 3.1 million to the Chilean authorities in 2009 due to administrative irregularities regarding General Pinochet’s money.

The plaintiffs hope to achieve a result in Spain that is at least comparable to that achieved in the United States, where Riggs Bank agreed in 2005 to pay a fine of almost $ 9 million. This enabled the bank to avoid prosecution for failing to report the transactions involving money transferred to General Pinochet’s bank accounts. It follows a US. Senate inquiry which also confirms that Banco de Chile was one of the banks that helped General Pinochet gain access to the US banking market.

The Spanish court explained in its report why it reopened the case, saying that the Banco de Chile should set aside the $ 103 million to cover the possible payment demanded by the victims of the Pinochet regime. But the Spanish judge leading the case has not yet ordered the bank to place this bond. The amount is based on the findings of the Spanish public prosecution in 2009 after it investigated possible money laundering by General Pinochet.

Banco de Chile is represented in Spain by Cuatrecasas, one of Spain’s largest law firms. None of them responded to inquiries for comment.

Juan Garcés, a Spanish lawyer working for the plaintiffs, said that if the bank refused to cooperate with the investigation, including an expected mortgage order, the next step would be to have the Spanish court use use bilateral agreements to force prosecutors in other countries to freeze assets owned by the bank. European Union legislation came into force last December aimed at improving judicial cooperation against tax evasion and money laundering.

According to the latest filing with the US Securities and Exchange Commission, the Banco de Chile had deposits in a dozen countries last year, including six in the European Union: France, Denmark, Finland, Germany, Sweden and the Netherlands.

Banco de Chile is majority owned by Quiñenco, the holding company of the Luksic family, which ranks among the richest in Chile. The bank’s president, Pablo Granifo Lavín, is an accused in the case. Banco de Chile closed its New York subsidiary after it became entangled in the Riggs investigation.

Spain’s national court has reopened the case, which was suspended for eight years after concluding that Chile’s court has not yet fully investigated the allegations of embezzlement against General Pinochet. “The facts must continue to be investigated,” a panel of three judges of the Spanish national court wrote in a ruling rejecting Banco de Chile’s appeal against the reopening of the case in Spain. The Chilean Supreme Court was notified of the ruling on July 8.

The foundation that filed the lawsuit is named after Salvador Allende, the left-wing president who died during a military coup in 1973 that ousted him from office.

The court ruling is in itself a victory for the plaintiffs against Banco de Chile, because the bank ‘tried for years to mislead Spanish judges by convincing them that its activities could be investigated in Chile instead,’ said Mr. Garcés said. “We have very good evidence that we trust that we can finally condemn those who helped the dictator wash his money.”

Mr. Garcés once acted as an adviser to Mr. Allende worked. For decades, he pursued General Pinochet and his money trail in various courtrooms.

In 2005, the Allende Foundation filed its first lawsuit against Riggs Bank in Spain, accusing it of assisting General Pinochet – as well as his wife, Lucía Hiriart, and Oscar Aitken Lavanchy, the appointed executor of his estate – in recovering stolen assets. to transfer abroad. bank accounts. The lawsuit was extended to include Banco de Chile as the bank to General Pinochet, but Banco de Chile then launched its own money laundering investigation in Chile, convincing the judges that the case was for Chile rather than Spain. set.

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