Buenos Aires Times

opinion and analysis PUBLIC-PRIVATE CORRUPTION

The Corruption Paradigm

The cash that has disappeared would be enough to cover the current fiscal deficit, seen by many as one of the main causes of current economic stagflation, many times over. It must be recovered.

Saturday 18 August, 2018
The mystery of the missing money.
The mystery of the missing money. Foto:JOAQUIN TEMES

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Something has clearly changed in Argentina since the appearance of the aptlycalled “corruption notebooks,” which promises to have serious consequences for former President Cristina Fernández de Kirchner and her entourage. It also poses huge risks for several of the country’s most prominent businessmen—among them President Mauricio Macri’s own cousin—having formed part of a public-private corruption ring that siphoned out some US$36 billion from the productive economy and into the pockets of a few, including those same businessmen. What was until very recently the normal way of doing things should no longer be possible, but in order to truly see the light at the end of the tunnel we need a judiciary that will investigate crime and, most importantly, investigate those currently in power. We also need the judiciary itself to be reformed, as judges like Claudio Bonadio, in charge of this case, are the same that not too long ago decided against investigating corruption, effectively losing society’s trust and eroding the value of our institutions.

Throughout the past couple of weeks, members of the so-called “public works club,” the businessmen who ran the country’s most prominent construction companies, have paraded through the halls of Comodoro Py federal courthouse, fessing up to their crimes in front of Prosecutor Carlos Stornelli. Many had been arrested, but pretty much all of them were released, charged after having reached a plea bargain that requires the approval of Judge Bonadio. Among them were representatives of Techint, the Argentine-Italian construction and engineering giant owned by billionaire Paolo Rocca.

Rocca gave the closing speech at the Businessmen’s Association of Argentina’s annual conference this week. With Macri in the crowd, Rocca claimed Techint “didn’t participate in the ‘corruption club’,” but added, “we were conscious of what was going on, we knew things weren’t going well, but we weren’t complicit nor did we participate.” Minutes before, President Macri told the businessmen that if they knew about “improper requests,” they should let him know.

Unfortunately, Techint was both complicit and did participate, as former director Luis Betnaza testified before Prosecutor Stornelli a few days earlier. Betnaza confirmed that his subordinate, Héctor Zabaleta, paid bribes in order to get the Argentine government to negotiate with Venezuela’s Hugo Chávez in 2008 after one of their subsidiaries, Sidor, had been nationalized. Another testimony, this time by Claudio Uberti—who was responsible for public works in the roads and highways sector—indicated Betnaza himself handed over US$100,000 on “five or six occasions” which were then given personally to Néstor Kirchner. Techint has also been the target of an investigation by prosecutors in Milan, which Perfil’s Emilia Delfino has followed closely, explaining how funds for bribes were triangulated through Switzerland, Panama, and Uruguay.

Techint is but one example, but all of these businessmen were complicit with the Kirchners. The bribes they paid were actually financed by the state. As was denounced by then Economy Minister Roberto Lavagna, the “public works club” acted as a cartel, artificially raising the cost of billion-peso public works projects, from which they would pay a percentage back to corrupt politicians. Lavagna was fired by Kirchner for bringing it up. The costs of those corrupt practices, the aforementioned US$36 billion, were borne by all of us who pay taxes.

The stories of Néstor’s greed are truly comical, if they weren’t deeply troubling. He was fond of safety boxes, of which he had many, and is said to have been angered so much by receiving pesos instead of dollars on one occasion, that he kicked a duffel bag filled with bills so hard that pesos flew all over his office in the Casa Rosada. He would ask his personal secretary to “give him three” meaning three punches to his collectors when they didn’t bring enough cash. And he would fly the money back to the Patagoinan Province of Santa Cruz in private jets, bringing back the empty suitcases.

For things to truly change, it is imperative that Judge Bonadio and Prosecutor Stornelli carry forth, respecting the law and imparting it fairly to all those involved. The participation of both Néstor and Cristina Kirchner and their closest advisors is pornographically clear. The judiciary, which was absolutely subservient needs to be investigated as well, the prime example being former federal judge Norberto Oyarbide. It’s also important that corrupt businessmen suffer the consequences of their actions, meaning jail time and important fines. The cash that has disappeared would be enough to cover the current fiscal deficit, seen by many as one of the main causes of current economic stagflation, many times over. It must be recovered.

As was mentioned in Perfil’s editorial last Saturday, Argentina needs strong companies if it is to progress. We also need straight politicians and judges. We face a unique opportunity, but unfortunately I can’t help but remain skeptical.

AGUSTINO FONTEVECCHIA

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