Translated by Amy Johnston
For a long time, news about organized crime has been relegated to the police section. This may be because we have come from the co-existence of an authoritarian regime with moderate rates of criminal violence. Who knows. We can be sure, however, that it was 10 years ago that we began to experience a dramatic spiral of high impact crimes and we still haven’t completely found a news section for this phenomenon.
Let’s see. The storm didn’t begin then, but during the presidential term of Felipe Calderón federal crimes increased by 74.7%. At the same time and across all states, at least one in five violent crimes increased. For example, in 27 states the monthly average of homicides increased (Herrera, 2013).
The return of the Institutional Revolutionary Party (PRI) did not improve the situation. In order to avoid opening old wounds, let’s only look at the most recent analysis by Alejandro Hope [Mexican security expert], which looks at data regarding homicide taken from the National Public Security System and the National Institute of Statistics and Geography (INEGI). Hope anticipates that the six-year term of Peña Nieto will almost certainly result in 9,000 more violent deaths than during Calderón’s term.
For years we have been saying that these are the costs of combatting delinquency. However, as Mariclaire Acosta highlighted in her publication ‘Mexico’s Chronic Impunity’ (La impunidad crónica de México), we have become “a country at war with itself.”
All wars have deaths… and funding.
It was only two weeks ago on 10th February, that the Texan branch of the British bank HSBC received a new claim against it for having been involved in money laundering from Mexican drug cartels. The claim is a civil action brought about by relatives of people who were murdered in Mexico. The claim of the plaintiffs is very convincing: these murders happened thanks to the financial support that banks gave to drug trafficking.
The issue has precedent. In 2012, the same bank was declared guilty of allowing money from a criminal source to travel from Mexico to the U.S.. For this and other accusations, the bank ended up paying a fine of 1.9 billion dollars (the equivalent of the entire budget for the National Autonomous University of Mexico (Universidad Nacional Autónoma de México) for 2016. Paying this fine meant that the company avoided a criminal trial.
Not long before that, in 2011, Wachovia Bank – part of the giant Wells Fargo – paid a forfeiture of 112 million dollars and a fine of another 50 million. This was part of its recognition of guilt for the crime of money laundering and for allowing Mexican drug traffickers to use its organization. These payments saved the company from facing criminal proceedings. Or in other words, this company also bought its innocence.
The legal entanglement of U.S. banks operating in Mexico and Mexican bankers is longstanding. It is about 20 years since the first judicial accusation against the porosity of criminal money in the financial system. In one proceeding which finished in 1999, 26 bankers and 3 banks were declared guilty of fraudulent operations and money laundering.
The most well-known case was that which involved the Salinas de Gotari family [Carlos Salinas was president, 1988-1994]. In this incident, a high executive of Citibank declared having designed schemes to move 100 million dollars whose origin he could not verify as legal. The statements form part of a long investigation which was carried out by a subcommittee of the U.S. Senate. The results were devastating. Citibank had helped Raúl Salinas de Gotari hide illegal money.
Although in Mexico cases are not even investigated – and even less are punished - there is a pattern: institutions which are legally declared guilty of financially serving criminals end up using that same money to buy their impunity.
To paraphrase Saúl Faúndez (a character from Alberto Fuguet’s novel Tinta Roja [Red Ink]), maybe the social section is the police section for the rich. That is where many white collar delinquents appear with a photo, name and surname. Spanish Original
*Miguel Pulido is a lawyer. He has been director of the Fundar Center for Analysis and Research, a professor at the Iberoamerican University and visiting scholar at Yale University. Currently he is involved in Antifaz (Mask) (www.antifaz.org.mx), a project to address critical public issues, political elites and power dynamics. Twitter: @nomus77
Let’s see. The storm didn’t begin then, but during the presidential term of Felipe Calderón federal crimes increased by 74.7%. At the same time and across all states, at least one in five violent crimes increased. For example, in 27 states the monthly average of homicides increased (Herrera, 2013).
The return of the Institutional Revolutionary Party (PRI) did not improve the situation. In order to avoid opening old wounds, let’s only look at the most recent analysis by Alejandro Hope [Mexican security expert], which looks at data regarding homicide taken from the National Public Security System and the National Institute of Statistics and Geography (INEGI). Hope anticipates that the six-year term of Peña Nieto will almost certainly result in 9,000 more violent deaths than during Calderón’s term.
For years we have been saying that these are the costs of combatting delinquency. However, as Mariclaire Acosta highlighted in her publication ‘Mexico’s Chronic Impunity’ (La impunidad crónica de México), we have become “a country at war with itself.”
All wars have deaths… and funding.
It was only two weeks ago on 10th February, that the Texan branch of the British bank HSBC received a new claim against it for having been involved in money laundering from Mexican drug cartels. The claim is a civil action brought about by relatives of people who were murdered in Mexico. The claim of the plaintiffs is very convincing: these murders happened thanks to the financial support that banks gave to drug trafficking.
The issue has precedent. In 2012, the same bank was declared guilty of allowing money from a criminal source to travel from Mexico to the U.S.. For this and other accusations, the bank ended up paying a fine of 1.9 billion dollars (the equivalent of the entire budget for the National Autonomous University of Mexico (Universidad Nacional Autónoma de México) for 2016. Paying this fine meant that the company avoided a criminal trial.
Not long before that, in 2011, Wachovia Bank – part of the giant Wells Fargo – paid a forfeiture of 112 million dollars and a fine of another 50 million. This was part of its recognition of guilt for the crime of money laundering and for allowing Mexican drug traffickers to use its organization. These payments saved the company from facing criminal proceedings. Or in other words, this company also bought its innocence.
The legal entanglement of U.S. banks operating in Mexico and Mexican bankers is longstanding. It is about 20 years since the first judicial accusation against the porosity of criminal money in the financial system. In one proceeding which finished in 1999, 26 bankers and 3 banks were declared guilty of fraudulent operations and money laundering.
The most well-known case was that which involved the Salinas de Gotari family [Carlos Salinas was president, 1988-1994]. In this incident, a high executive of Citibank declared having designed schemes to move 100 million dollars whose origin he could not verify as legal. The statements form part of a long investigation which was carried out by a subcommittee of the U.S. Senate. The results were devastating. Citibank had helped Raúl Salinas de Gotari hide illegal money.
MV Note: In January 1999, Carlos Salinas's older brother Raúl Salinas de Gortari was convicted of ordering the murder of the PRI official (and Salinas brother-in-law) Jose Francisco Ruiz Massieu and sentenced to 50 years in prison. In July 1999, an appeals court cut the sentence to 27 1/2 years. In June 2005 the conviction was overturned, and Raúl Salinas was freed.
In November 1995, Raúl Salinas's wife, Paulina Castañón, and his brother-in-law, Antonio Castañón, were arrested in Geneva, Switzerland, after attempting to withdraw $84 million USD from an account owned by Raúl Salinas under an alias. Their capture led to the unveiling of a vast fortune spread around the world and amounting to hundreds of millions of dollars. A report by the U.S. General Accounting Office indicated that Raúl Salinas had transferred over $90 million out of Mexico into private bank accounts in London and Switzerland through a complex set of transactions between 1992 and 1994. Wikipedia In 2014, Raúl Salinas was exonorated of charges of money laundering.From then on, the cases linked to the U.S have not stopped. There are hundreds of stories and characters involved. In the mix there are business people, customs officers, ex-governors and many more. They are power games with numbers that would make anyone feel sick. It was only back in 2010 that Wells Fargo was accused of laundering 380 billion dollars from drug trafficking. [MV Note: The amount is the total processed by the bank for Mexican-currency-exchange houses from 2004 to 2007]. That equates to more money than the entire expenditure budget for Mexico that same year or nearly a third of the country’s total GDP, in accordance with the exchange rate at the time.
Although in Mexico cases are not even investigated – and even less are punished - there is a pattern: institutions which are legally declared guilty of financially serving criminals end up using that same money to buy their impunity.
To paraphrase Saúl Faúndez (a character from Alberto Fuguet’s novel Tinta Roja [Red Ink]), maybe the social section is the police section for the rich. That is where many white collar delinquents appear with a photo, name and surname. Spanish Original
*Miguel Pulido is a lawyer. He has been director of the Fundar Center for Analysis and Research, a professor at the Iberoamerican University and visiting scholar at Yale University. Currently he is involved in Antifaz (Mask) (www.antifaz.org.mx), a project to address critical public issues, political elites and power dynamics. Twitter: @nomus77