Vice-president Danilo Astori said he was surprised at the way events unfolded ending with the decision from the Royal Bank of Canada of leaving Uruguay, but also concerned about the international impact of such a move, triggered by a ‘disorderly’ raid in its offices.
The Royal Bank of Canada announced it was leaving Uruguay at the end of October as part of a restructuring of services. However the bank premises suffered a raid in June on orders from an organized crime magistrate involving special forces and on-looking Argentine police members that seized all computers, documents on clients, pen-drives and even cellular phones from the frisked staff.
“I’m concerned because it is not good for Uruguay that a bank of such relevance leaves the country and I’m also concerned about the events that originated such a decision. I believe it could have been done in another way, more orderly”, said Astori.
The raid was done on request from an Argentine magistrate that is investigating money laundering and tax elusion in the international transfer of soccer players, mostly to Europe, a business involving tens of millions of dollars.
The request was to raid the Royal bank of Canada offshore offices in Montevideo and three other financial institutions, affiliates from Argentine companies also operating in a tax-free zone near downtown Montevideo. Allegedly the excesses in the raid were committed at the Canadian bank. One of the other three affiliates was later closed by the Uruguayan Central bank.
The computers and other clients information from the Canadian bank were almost all handed to the Argentine magistrate, but at last moment and following instructions from a higher court and the Central bank, it was decided that only Uruguayan eyes would have access to the data, for which a special commission was created including members of the Executive anti-assets laundering office to assess contents.
A week ago some of the computers were returned but the rest continue in the hands of the special commission.
Uruguay’s private banks association has complained about the form the raid was conducted and so has the Free Zone, Zonamerica, involved where the events took place.
They have been demanding a strong message from the Uruguayan government to ensure there is no repeat of such actions and a protocol procedure is agreed, with the participation of the Central bank.
Astori, an accountant by training, is the first top official to mention concern about the events, following comments by other ‘official sources’ arguing that the fact that the bank is leaving is no tragedy, “they are not that relevant as a bank and they had already been sanctioned and fined for not keeping strictly to Uruguayan law on assets-laundering schemes”.
In effect in December 2008 the Royal Bank of Canada was fined the equivalent of 650.000 dollars for omissions in the implementation of the ‘integral scheme to prevent asset laundering and funding terrorism’, particularly referred to not reporting ‘suspicious operations’.
“The problem is that complaints come from people from the same financial system that don’t seem to understand that Judge Adriana de los Santos is acting against organized crime” said the Executive sources over the weekend.
However the magistrate committed two big mistakes: first to promise her Argentine peer all the information that was seized, which finally did not happen, and secondly because the prosecutor was fifteen minutes late, the raid by special forces was done “in a rather violent way”, as if “acting for the television cameras”.
But the Uruguayan government apparently was really irritated that the Private banks’ association and the free-zones organization came out publicly demanding a strong message from financial authorities giving assurances to the financial system that there would not be a repeat of this kind of events.
“A raid as if looking for smuggled goods in any common store: all staff against the wall, frisked and seizure of all suspicious data and records”, claimed Julio de Brum president of the Uruguayan Association of Banks.