The Pinochet money trail

Timothy L. O’Brien and Larry Rohter
New York Times
December 12, 2004

Santiago, Chile: Gen. Manuel Contreras is a religious man. A bas-relief of the Last Supper hangs on his dining room wall, not far from a thick, leather-bound Bible that rests on a table. As the former head of Gen. Augusto Pinochet’s secret police in Chile, General Contreras is also a controversial man. A large silver plate, given to him by Argentina’s intelligence services, sits on a shelf, a few feet from the Bible.

The inscription on the plate reads June 1976, the same month and year that General Contreras and other South American intelligence chiefs, according to declassified United States intelligence documents, authorized assassinations of exiled political dissidents in a wide-ranging conspiracy known as Operation Condor. Although General Contreras denied the existence of such a plan in a recent interview in his hillside home here, the plot has been amply documented in the United States intelligence records.

General Contreras’s past banking activities have been documented, too. According to a declassified 1979 State Department memo, he opened a “secret bank account” at Riggs Bank in Washington in 1966, when he was a young soldier based in the United States. The State Department report noted that General Contreras’s balance at Riggs was as high as $26,000 in the mid-1970’s. In the interview, he said he was sure he never kept more than $1,000 at Riggs and that it was common for members of the Chilean army who were based in the United States to have personal accounts at the bank.

But General Contreras was less certain about funds Riggs held for his former boss, General Pinochet, whose accounts are among those at the center of a sweeping money-laundering investigation of the bank. The sums involved – as much as $8 million, according to an assessment by the United States Senate – have left even General Pinochet’s staunchest allies wondering about their origin.

“The problem with Pinochet is that he got quite a lot,” General Contreras said. Army wages were very low, he said, even for someone as senior as General Pinochet.

Does he believe that the general accumulated his riches fairly?

“I don’t know,” said General Contreras, shaking his head. “I don’t know.”

As Chile’s strongman from 1973, when he overthrew Salvador Allende, an elected civilian president, to 1990, General Pinochet presided over a purge of political opponents and the creation of a police state. But he also laid the foundations for what has become Latin America’s most stable and promising economy – all, as the general’s supporters have claimed, without ever stealing a dime.

In the United States, however, Senate investigators published a lengthy report in July that detailed multimillion-dollar accounts that General Pinochet and his wife, Lucia, held at Riggs. The funds were disguised and moved around the globe for years with the cooperation of Riggs officials, said Senate investigators, even after he was detained in London in 1998 and held under house arrest on Spanish court accusations of human rights abuses and genocide.

Regulators fined Riggs $25 million earlier this year for failing to comply with bank secrecy laws, and a criminal investigation of the bank and its executives for possible money laundering is under way at the Justice Department. No Riggs officials have been charged with wrongdoing, although a former executive is the subject of a grand jury investigation of possible bank fraud.

In Chile, the fact that General Pinochet secreted large sums of money in other countries has forced a reassessment of his legacy and prompted scathing headlines questioning his integrity. The Chilean Congress has established a commission to determine if the Riggs accounts contain stolen government funds, an investigation that is moving apace with a separate judicial inquiry and a tax evasion investigation.

“Let’s not kid ourselves,” said Juan Pablo Letelier, chairman of the Chilean congressional commission and son of Orlando Letelier, a former Chilean foreign minister who was assassinated in Washington as part of Operation Condor. “Obviously, no public servant, even one who is head of state and commander in chief of the army, amasses that kind of wealth in this country, based on public income only.”

Exactly how the general supplemented his modest salary – never more than about $40,000 a year as president – with foreign bank accounts holding millions of dollars remains unknown. His financial adviser has told the Chilean press that the general’s fortune could be as much as $15 million and that all of it was accumulated legally, through shrewd investing.

Chilean government officials have openly ridiculed that explanation. The general’s own sworn financial statements, released in recent weeks by United States Senate investigators and approved by a senior Riggs executive, indicate that he received large “commissions from service and travel abroad” during his nearly 25 years as Chile’s ruler and military chief.

The statements are based on documents that Riggs has furnished to federal regulators. They show, for example, that in 1976 General Pinochet received a $3 million payment stemming from official duties involving the United States. And from 1974 to 1997, according to the documents, General Pinochet received payments totaling at least $12.3 million in connection with official duties involving China, Brazil, Argentina, Paraguay, Spain and Britain.

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