Fact Check: Argentina

906 days, 20 hours, 58 minutes ago

SINCE RUFO EXPIRED

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Meet Diego Marynberg

Financier Diego Adolfo Marynberg has recently emerged as a new face in the complex web of alleged corruption in Argentina.  But who is he?  Marynberg has a very colorful past and maintains an intensely low profile.  We know from news reports of his close relationship with Argentina’s Economy Minister Axel Kicillof.  These same reports have highlighted allegations by Argentine prosecutors of illicit enrichment and money laundering.

All of this came to light recently when Juan Ricardo Mussa filed a formal criminal complaint, accusing Marynberg of conspiring with Kicillof for illicit enrichment and money laundering.  The complaint urges the court to investigate allegations that while Marynberg informally advised Kicillof on Argentina’s debt situation, he set up a fund called Latam Securities that acquired US$200 million in Argentine bonds as a kind of political speculative maneuver.  Kicillof, according to a report by Clarin reporter Marcelo Bonelli, “intervened in favor of Latam to have the Central Bank of Argentina (BCRA)” sell Marynberg those bonds “in a direct and advantageous manner.”  According to Bonelli, it was then-BCRA President Juan Fabrega’s discovery of the maneuver, and his confrontation with Kicillof about it, that led to Kicillof’s “operation” to oust Fabrega, who resigned in October and was replaced with a Kicillof crony, Alejandro Vanoli.

Another investigative reporter, Daniel Santoro – whose family has faced intimidation by agents of the Kirchner government as recently as this year – confirmed from business community sources that the US$200 million bond operation favoring Latam took place.

For Kicillof’s part, sources at the Economy Ministry have claimed that Kiciloff “ doesn’t know Marynberg.” Really?  Let’s take a closer look at the web of relationships.  In January 2014, Marynberg hired Jorge Pepa, a New York-based Argentine investment banker, to head his team at Latam Securities. Pepa has a longtime association with Kicillof and his Deputy minister, Emmanuel Alvarez Agis, who Pepa was in regular contact with during 2014 after he arrived at Latam Securities.  In fact, La Poliítica reported that in 2013 Pepa used his connections at his former employer, Union Bank of Switzerland (UBS), to collude with Marynberg and Kicillof to set up a “money trail” for the insider bond maneuver.  These activities were allegedly carried out with the knowledge of Economy Ministry officials who had direct access to the plans and actions that President Cristina Kirchner would be taking each day, according to court filings.

Marynberg’s past dealings raises questions about why Argentina’s Economy Minister would allow himself to be so closely linked to all of this.  We’ve dug a little deeper into Marynberg’s past and this is some of what we’ve found:

After serving as an advisor to Argentine Central Bank boss Javier González Fraga in the early 1990s, Marynberg’s first brush with publicity came in a string of banking collapses in the late 1990s. In 1996, Lausanne, Switzerland-based Socimer International Bank acquired a 30% stake in Argentina’s Banco Patricios, which was owned by Alberto Szpolski, Marynberg’s father-in-law. Socimer owned Banco Medefin, another troubled Argentine bank. Marynberg then became a director of Socimer and its subsidiary firms in Argentina.  All three banks had collapsed by 1998, and a judicial investigation uncovered massive irregularities in favor of family members of the bank’s owners, and as criminal indictments began to be issued, Diego fled Argentina.

As Mussa’s criminal complaint filed in October details, Marynberg was named, though not charged, in a fraud case filed in Argentina stemming from the banks’ collapse. Two former clients sued Socimer broker Pablo Stabholz for US$200,000, alleging that he had transferred bonds issued by the local manufacturing firm Alpargatas to a bank in Miami, and then to his own accounts in New York. Marynberg told Argentine prosecutors that he had advised the clients to transfer their money to Miami, but he was not charged in the case.

Nonetheless, according to the indictment the prosecutor in the case believed that Marynberg had conspired with Stabholz, taken the money himself, and used his subordinate Stabholz as a scapegoat.  The judge acquitted Stabholz. Though the decision was appealed, and the court re-opened the case, it appears there has been no further judgment.  If the prosecutor was right, Marynberg got away with the money, and with impunity.  This is a familiar story.

Why would Argentina’s Economy Minister engage in such maneuvers with a character like Marynberg who, despite his extremely low profile in recent years, has been at the center of very shady cases involving bank and securities fraud.  It’s clear that Marynberg benefits from this relationship.  Here’s our question: What does Kicillof get?