The Miami Herald
Thu, July 15, 2004
Ex-dictator had millions in U.S. bank
BY ANDRES OPPENHEIMER AND JUAN O. TAMAYO
Former Chilean dictator Gen. Augusto Pinochet -- a man charged with
widespread human rights abuses but never tied to major corruption
scandals -- had up to $8 million in a U.S. bank, according to a U.S.
Senate report released Wednesday.
A 119-page report by the Senate Subcommittee on Investigations said
Pinochet opened at least six accounts and several certificates of
deposit at the Washington-based Riggs Bank while he was under house
arrest in London and his assets were subject to court proceedings.
The Senate inquiry, which looked into whether Riggs had violated U.S.
laws that prohibit banks from accepting ''dirty'' money from foreign
government officials, found that ``Riggs opened multiple accounts and
accepted millions of dollars in deposits from Mr. Pinochet with no
serious inquiry into questions regarding the source of his wealth.''
The bank also ''helped him set up offshore shell corporations and open
accounts in the names of those corporations to disguise his control of
the accounts,'' the report added. The total amount of Pinochet's funds
at the bank ranged from $4 million to $8 million, it said.
Pinochet was not immediately available for comment, but Gen. Guillermo
Garín, a friend who often acts as a family spokesman, said
similar past reports of Pinochet bank accounts have been dismissed.
''I have no knowledge of this at all, but in the past there were rumors
of this type and they were always denied because there was nothing to
them,'' Garín said in a phone interview from Santiago.
''It could be that they are confusing things . . . because in the past
the [Chilean] army operated with the Riggs Bank in Washington, in its
institutional role,'' Garín added. ``I was always aware that we
had accounts there, with the knowledge of everyone and the approval [of
several government financial agencies] for such things as logistical
The Senate investigators -- who in 1999 launched a similar inquiry into
Citibank's deposits of Raúl Salinas, the brother of former
Mexican President Carlos Salinas de Gortari -- said they reviewed more
than 100 boxes containing hundreds of thousands of pages of documents
from Riggs Bank. Many of those documents were obtained through
Pinochet, who took power in a 1973 coup that set a trend of military
governments in the region, served as president until 1990 and became a
senator for life afterward.
Though accused of massive human rights violations in the wake of the
coup, his Chilean supporters boasted that he was never linked to major
The Senate inquiry said that Pinochet was a Riggs customer for at least
eight years starting in 1994, and that Riggs Senior Vice President for
Latin America Carol Thompson met with him twice a year, in addition to
Despite U.S. ''Know Your Customer'' rules requiring banks to conduct
extensive investigations before accepting money from foreign government
officials to make sure that it is not tainted by drug trafficking or
corruption, ''senior Riggs officials actively sought the Pinochet
accounts'' and did little to check the source of his funds, the report
In 1996 and '98, Riggs helped Pinochet set up two offshore shell
corporations in the Bahamas, Ashburton Co. Ltd. and Althorp Investment
Co., the report said. Neither company had employees nor physical
offices, but Riggs nevertheless allowed Pinochet to deposit his money
in the companies' names.
In a 1998 ''client profile'' demanded by U.S. regulators, Riggs never
identified Pinochet as Ashburton's beneficial owner, stating that the
owner's name was ''kept in vault.'' The profile said the customer
behind Ashburton was a client with an estimated annual income of up to
$200,000, and an estimated personal net worth of $50 million to $100
million, it said.
The Senate report said that in late December 2000 or early January
2001, after the British newspaper The Observer reported Pinochet had
more than $1 million in Riggs, the bank altered the names on a personal
Pinochet account, changing ''Augusto Pinochet Ugarte and Lucia Hiriart
de Pinochet'' to ``L.Hiriart and/or A. Ugarte.''
'By changing the official account names in this manner, Riggs ensured
that any manual or electronic search for the name `Pinochet' would not
identify any accounts at the bank,'' the Senate report said. ``In fact,
Riggs appeared to take affirmative steps to hide the Pinochet
relationship from bank examiners.''