Fact Check: Argentina

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Kicillof faces complications with a denunciation linking him to an investment fund and a foreign bank


Tuesday, October 14, 2014
By Carlos Arbía – From the Economy Ministry

Economy Minister Axel Kicillof could become the third head of this ministry to be prosecuted by the judiciary from Kirchnerist governments if an allegation of corruption for his alleged involvement in an investment fund and an international bank moves forward. This criminal complaint against the minister was filed by citizen Ricardo Juan Mussa.

The text, which Infobae had access to, mentions that the plaintiff lodged a “formal complaint to investigate H.E. for possible offenses: Configuratives of Breach of duty by a public official, in violation of the ethical practice of civil law 25.188 Art. 2 inc. B, D Inc., articles 35 and 45, Negotiations Incompatible with the public service (article. 248.253, 265, 266 of the Penal Code) Concealment, illicit enrichment, Racketeering, Money Laundering, Fraud and Others, as well as consider what H.E. considers according to the evidence collected, in an absolutely irregular manner and violating the Laws, Criminal code and the Law on Public Administration, by the actions within the Ministry of Economy by Axel Kicillof and Diego Marynberg and those responsible for the international fund Latam Securities and GEO Equity Opportunities that might be related to an official of the international bank UBS. ”

These funds would have benefited by operations with bonds issued by the Central Bank of Argentina (BCRA), allegedly on orders from Kicillof. The complaint against Kicillof was presented before federal Judge Ariel Lijo, and is one of the topics most discussed within the Ministry of Economy in recent days, both by some second line officials and employees at the Economy Ministry .

It is a transaction of about US$200 million in which Axel Kicillof and one of his close associates carried out for the fund Latam Securities. This fund is owned by Argentine financier Diego Marynberg, who owns the consultancy Clover Consulting in Buenos Aires and has lived in New York for several years, according to reports from the website La Politica Online. The Central Bank sold the bonds to UBS and then they would have been repurchased by Latam Securities. It is striking that in recent days the web page of the firm, with offices in New York in front of Central Park, has been inaccessible.

According to the opinion of some experts consulted by Infobae in reading the complaint, they can’t understand what kind of offense could have been committed, but do not rule out that a federal judge would advance the investigation that is being demanded. What would have to be studied and investigated is whether the suspected maneuver for the sale of the bonds is illegal. The problem is that the Ministry of Economy may have given the order to the Central Bank to sell those bonds to Latam that are issued by the National Treasury. The question is whether there was insider trading. The deal would have consisted of ending up with the difference between the purchase price and the selling price.

The other question is what value the bonds were sold at to Latam and if the value coincided with the market or was lower.

It also asks for an investigation whether Axel Kicillof intervened on behalf Latam Securities for the Central Bank to sell the bonds directly and advantageously, and was an operation was for about US$200 million dollars to benefit Diego Marynberg, an investor with solid contact and consultation with Kicillof. In the filing, it also mentions an article by journalist Daniel Santoro of Clarin, who in an article provides details on Marynberg’s activity who is linked to the financial firm Socimer Finance Group.

Marynberg had informally advised the minister in his arm wrestling against holoouts that have demanded payment from Argentina from a judgment of about US$1.65 billion.

Suspicion also falls on Deputy Minister Emanuel Alvarez Agis. This official was the one who’d asked the authorities of the Central Bank for them to sell bonds to Latam Securities.

Agis Alvarez, nicknamed “The Head” is one of the officials who said last week that the government can “apply the law of supply for the farmers to take out their grains and sell them.”

The most serious part is that on June 30, the same day that the government could not pay about US$539 million in Discount bonds under New York law, another new request for bond sales to the fund was requested. In that respect, if the complaint goes forward, the testimony of the former president of the BCRA, Juan Carlos Fabrega, would be key, and he could not only take revenge on Kicillof but also on some officials and even President Cristina Kirchner herself.

Fabrega knows all about the operations for millionaire profits that some Kirchnerist businessmen received from Banco Nacion and also knows how the Central Bank has authorized discretionary rotation of profits abroad and bond sales like Mussa’s complaint points to. In the same complaint, it requests testimony from ex-Central Bank president Juan Carlos Fabrega, and journalists Marcelo Bonelli and Daniel Santoro from Clarin, for recent articles published on the subject.

View Original Article: Complica a Kicillof una denuncia que lo vincula con un fondo de inversión y un banco extranjero