MercoPress, en Español

Montevideo, March 25th 2019 - 20:38 UTC

US Nevada court grants 'holdouts' discovery rights into assets of Kirchner family friends

Thursday, August 14th 2014 - 05:41 UTC
Full article 23 comments
“Campagnoli authored a report stating that Baez laundered 65 million dollars through 15 Nevada corporations” “Campagnoli authored a report stating that Baez laundered 65 million dollars through 15 Nevada corporations”
US Magistrate Judge Cam Ferenbach granted NML Capital’s request for access to information about companies that Baez allegedly controls in Nevada US Magistrate Judge Cam Ferenbach granted NML Capital’s request for access to information about companies that Baez allegedly controls in Nevada
Lanata videotaped statements by alleged associates of Baez describing a scheme to take cash out of Argentina through a network of obscure companies Lanata videotaped statements by alleged associates of Baez describing a scheme to take cash out of Argentina through a network of obscure companies

The hedge fund Elliott Management secured a victory on Tuesday in its pursuit of Argentine assets abroad, as a court in the US state of Nevada granted the corporation discovery rights to 123 companies allegedly linked to the Santa Cruz public works tycoon Lazaro Baez, and believed to be closely linked to the Kirchner family.

 Both parties will have to meet to file a joint status report by September 12.

US Magistrate Judge Cam Ferenbach granted NML Capital’s request for access to information about companies that Baez allegedly controls in Nevada, which the holdout hedge fund suspects were used to launder 65 million dollars of funds for the government. NML is seeking information for the companies so as to locate these funds.

It marks the latest attempt by the hedge funds fund to seize Argentine assets abroad in its effort to get cash for defaulted bonds that it has refused to restructure. But it marks the first time it has won a court victory over Argentine assets abroad since the country entered into default July 30 after missing a deadline to reach an agreement with the so-called holdouts.

The judge’s decision is filled with questionable statements that appear to turn what have been accusations and claims by opposition politicians and media into facts.

“There’s no dispute that Baez embezzled Argentine funds and that an embezzler or thief acquires no title to the property which he steals,” Judge Ferenbach said in his ruling. Baez denies he has operations in Nevada.

NML Capital, a division of Paul Singer’s Elliott Management, had requested discovery rights based on an “independent” investigation into Baez’s companies. The holdout fund assured there was a link between the companies and Argentina as the government would have given the funds to Baez.

“We have reason to believe that the illicit relationship between Baez and the Argentine government may have allowed Baez to abscond with tens of millions of dollars in assets, now hidden around the world,” NML wrote in its request.

NML has based its case on the criminal investigation launched last year by once-suspended prosecutor José María Campagnoli following a television report by Clarín Group star Jorge Lanata on his television show “Periodismo para Todos.” Lanata broadcast videotaped statements by alleged associates of Baez describing a scheme to take sacks of cash out of Argentina and launder about 65 million dollars through a network of obscure companies in tax havens around the world.

“The government initiated an investigation into Nestor Kirchner, Cristina Fernández de Kirchner and their confidant Lazaro Baez. All three allegedly embezzled millions of pesos from public-infrastructure and laundered the proceeds and other embezzled funds through Panama and various shell corporations,” Ferenbach wrote.

The government though did not investigate anything. It was Campagnoli, who had the investigation in his hands for 20 days before the local judiciary decided that the case was to be investigated by a federal court. The probe is being conducted by Federal Judge Sebastian Casanello and federal Prosecutor Guillermo Marijuan. In December, Campagnoli was accused of malfeasance for taking part in the investigation and for allegedly interfering with a colleague’s work. Campagnoli’s legal situation has to be defined by an impeachment tribunal before October, when the charges against him expire.

“Compagnoli (Campagnoli’s name was misspelled in the judge’s ruling) authored a report stating that Báez laundered 65 million dollars through 15 Nevada corporations. The report also states that all 150 Nevada corporations have the same director, Aldyne, a Seychellois corporation. After submitting the report to the Supreme Court, the Kirchner government retaliated and removed Campagnoli from office,” the ruling read.

Baez, who hasn’t been charged with a crime, has long denied any wrongdoing and says the embezzlement allegations are part of a campaign to discredit the Kirchner administration and hamper the operations of Austral Construcciones SA, his construction company.

After NML filed its request last month, the corporations owned by Baez claimed the responsive documents demanded didn’t exist, and that the court cannot compel a witness for a deposition on behalf of the corporation since none of them have representatives within the court’s subpoena power. The companies relied on the affidavit of Leticia Montoya, a corporate officer at Aldyne and the custodian of the records of some of the companies.

“Montoya is not a party and she resides in Panama, thousands of miles beyond the court’s subpoena power. Additionally, Panama is not a signatory to the Hague Evidence Convention, the treaty used to obtain evidence abroad,” Judge Ferenbach said, dismissing the affidavit of Montoya as sufficient proof.

The evidence issued by Baez’s companies in support of their position that no responsive document exists “is not credible,” Ferenbach wrote. “Neither Montoya’s affidavit nor the 123 corporations’ briefs offer any reason as to why the corporations do not have at least copies of their own operating agreements.”

Ferenbach said that in order to grant discovery the creditor must show that “the relationship between the judgment debtor and nonparty raises reasonable suspicion as to the good faith of assets transfers between the two.” The judge said this was proven by NML showing that “Baez money laundering involved the 123 Nevada corporations.”

Facts supporting this include, according to Ferenbach, Campagnoli’s report, “that says that Baez laundered 65 million through Panama and 150 Nevada corporations”, the Montoya affidavit, “which concedes that the 123 corporations are shell corporations” and mirror-image operating agreements and evidence that Aldyne and Gairns share the same office in the Seychelles.

“These are not fully-baked proposals,” said a source from one of the holdout firms hedge funds led by Aurelius Capital and NML Capital.

“Right now, any and all deal talks are completely dead, because the bitter public rhetoric of the Argentine government has killed any such interest on the part of third parties,” the vulture-fund-connected source added. (BAH).

Top Comments

Disclaimer & comment rules
  • gordo1

    “They seek them here, they seek them there those damned elusive Argentine assets”

    With apologies to the Scarlet Pimpernel!

    Aug 14th, 2014 - 06:07 am 0
  • CabezaDura2

    This is what I call F-ing awsome news... Singer needs streets named after him in Argentina!

    https://pbs.twimg.com/media/Bt1i-LEIUAABWcy.jpg

    Aug 14th, 2014 - 06:07 am 0
  • yankeeboy

    The Kirchners and their supporters are so stupid. Why oh why would they set up companies in the USA to launder money?
    This will blow up in their face

    I would love to see CFK and her disgusting children and minions rot in USA jails just like so many of the world's scumbags.

    Aug 14th, 2014 - 10:17 am 0
Read all comments

Commenting for this story is now closed.
If you have a Facebook account, become a fan and comment on our Facebook Page!