Lid lifted on Martinelli circle money laundering

Businessmen close to the administration of ex-president  Ricardo Martinelli (2009-2014) moved large sums of money through the brokerage Financial Pacific (FP)  and the “High Spirit” account  opened  “to manipulate the stock market with shares of Petaquilla”.

The Martinelli link was originally  revealed in a   2012 statement of  Mayte Pellegrini, former employee of the company ,, currently under house arrest accused of embezzling  $12 million.

 Although Martinelli denied having any relationship with the account, among  the signatories and beneficiaries of the account reports La Prensa,  was  his brother in law Aaron Ronny Mizrachi, who recently fled Panama on Martinelli’s private jet.

Mirrachi’s company  Caribbean Holding Services, made several irregular  deposits to the account, according to the Superintendency of Securities. Caribbean Holding Services is the same company that was used to pay the company NSO Group for the  eavesdropping system Pegasus, acquired during the past administration.

In a detailed report on August 31, La Prensa reveals a network of irregular transfers detected by the Superintendency of Securities, which includes movements between accounts of  Financial Pacific by some of the major suspects currently under investigation in a series of financial scandals- including Felipe Pipo Virzi a businessman and former vice president  who is under house arrest for his alleged link in the corruption scandal of the failed irrigation project Tonosí, and society Langton International Holdings, linked to Christopher Salerno, the visible face of  Cobranzas del Istmo   involved  in another corruption scandal and under house arrest.

The funds received by  “High Spirit”, some of unknown origin, were used to buy shares in companies such as Petaquilla Minerals and Inmet Mining.

Some of these operations generated gains of up to 104% by the revaluation of the shares. T he regulator believes that investment in shares was “a way to justify illegal entry of money (…) and then be withdrawn into licit funds, regardless of whether you win or lose (.. .) because its origin is illegal. “

All of the movements are contained in a report by the commission of financial crimes and money laundering against FP and Financial Account “High Spirit” by the Superintendency of Securities (SVP) to  the Attorney General’s Office in  June accessed by La Prensa.

 Research at the SVP  reveals a pattern of irregular transfers through multiple accounts of the  brokerage whose architects are close to Martinelli . In November 2012, Pellegrini testified that FP  ex-directors  Clare West and Ivan Valdes said publicly that the secret account “High Spirit” belonged to the “President Ricardo Martinelli,” and that it was “to manipulate the stock market with shares of Petaquilla”.

Martinelli denied the relationship and sent a note to the then Attorney General, Jose Prado Ayu-now president of the Supreme Court, in which Clare assured that neither the president nor his family were related to the account “High Spirit “.

However, among the signatories and beneficiaries of the account figure Ronny Aaron Mizrachi, who is also allegedly linked to the purchase of the Pegasus system used to tap cell phones.

On July 29, just after the scandal broke, Mizrachi fled to Miami on the plane, owned by Ricardo Martinelli, who has been  outside the country since January..

Martinelli and former  Tourism Authoritymanager  Salomón Shamah were also linked to the former SMV director  Ignacio Fabregawho confessed  last week to giving confidential information to  the brokerage. Fabrega told the First Criminal Court that Shamah and  Martinelli had become shareholders of the brokerage firm, and told  him to  avoid intervention in the company.

IRREGULARITIES
SMV  identified a number of irregular movements under “High Spirit” which could constitute financial crimes and money laundering.

According to the law governing the activity of brokerage houses, an account should be used to invest in the market and receive the returns generated by operations. It is not allowed to receive or transfer funds to third parties who are not the holders of the investment account. This rule was not complied with by “High Spirit” says La Prensa.

The SMV report highlights . In three separate deposits, between October 2010 and July 2011 the company Caribbean Holding Services sent  $583,743 to “High Spirit

“High Spirit” was opened in March 2010 with several deposits from the Audi Bank in Switzerland, but the senders of  the funds are not identified. The complaint states that “on   March 26, 2010, the account had a balance of $975.979 cash, without information on the origin of thefunds, which is a serious deficiency violating  rules  No. 5-2003 and 5 -2006 on prevention of money laundering and terrorist financing “.

Among the suspicious “High Spirit” contains a transfer from Jal Offshore society, which also had an account with Financial Pacific. As in the case of Caribbean Holding Services, the company was not identified as a related party to receive or transfer funds.

In turn, in the register of incoming and outgoing Jal Offshore, which had a Banco Universal account, are also movements that drew  the attention of the authorities, most notably a deposit of $ 1.5 million from Virzi  January 13 2010, several unidentified transfers and a $125,000 deposit by Langton International Holdings.

Langton, established in the British Virgin Islands, is the same company that received between June 2012 and June 2014, $25.2 million from the collection company that exclusively  handled the  collection of delinquent tax bill during the past administration  and is the subject of another judicial investigation that so far has resulted in the detention of the former head of Internal Revenue Luis Cucalón and house arrest of Christopher Salerno Through Langton, Salerno transferred $1 million to a company linked to Cucalón. In addition he testified  having given cash and checks to  Martinelli. A statement  denied by the former leader.

 STOCK MANIPULATION
With the funds received “High Spirit” did  various operations in the stock market including  purchasing  include shares of Petaquilla Minerals and Inmet Mining, two companies that have state mining concessions in Panama. Some movements generated c profits, close to  800,000, “as it moved  Petaquilla shares up 74% and 104%,” according to the complaint.

In other cases the gains were not as substantial, but, according to the regulator, it   was not important whether the movement generated a gain or a loss, as an illegal source of money was justified through investment in shares  and then became [laundered] “lawful money “

Another movement  irregular funds occurred March 20, 2012; this time the firm Parker Electronics, whose directors include Navin Mohan Bhakta (also asignatory to “High Spirit”) and Guadalupe Mejia.

Roberto Brenes, CEO of the Panama Stock Exchange, one of the first people who warned about the scandal of Financial Pacific, said last week after  the linking of Fábrega, Martinelli and Shamah, that much remains to be investigate how the brokerage  money laundering was used to hide  bribes.

Meanwhile, Pellegini’s lawyer  Kevin Moncada,  said: ” that the brokerage Financial Pacific, besides being involved in the crime of insider trading, was a money laundry. In an  unimaginably cynical and unscrupulous way money was bleached.”

JUDICIAL  INTERFERENCE
As the authorities unravel the fabric created around the brokerage, more relevance   is brought to attempts to obstruct the investigation in the past. The Superintendency refers to the suspension of the reorganization of the brokerage firm, after the Supreme Court-in particular the then Judge Alejandro Moncada Luna, currently in El Renacer prison, – admitted an injunction of guarantees brought by the representatives of Financial Pacific that allowed the executives of the brokerage to  regain control. “As a result of this legal action, the Superintendent had no chance of collecting says the complaint.

It also  raised the  suspicions sale of the brokerage amidst the  scandal and suspended its operations. In 2013 the Superintendency authorized the change of ownership of the shares of   Zbeda Ori Levy, Ivan Valdes and Clare West Valdes to  Banvalores, SA, whose owners are Joao Bosco Santana de Lima, Ricardo De Souza Leao Sampaio, Rogerio Marcio Pereira and Joshua Chavez Absalom. They are in addition to the signatories and beneficiaries of the “High Spirit” account and Caribbean companies and Jal Offshore Services Holding, mentioned in the complaint as “allegedly linked to the facts.”

Irregularities in  “High Spirit” continued until its closure, on June 30, 2014, the same day that ended the administration of Ricardo Martinelli.

The transfer of $ 733, 939 to an account was ordered, but without indicating the final beneficiary.