- The Washington Times - Tuesday, May 28, 2013

Former Guatemalan President Alfonso Portillo has been extradited to the United States to face charges of conspiring to launder millions of dollars embezzled from his government through bank accounts in his country, U.S. Drug Enforcement Administration chief Michele M. Leonhart announced Tuesday.

Mr. Portillo arrived Friday in the U.S. and made an initial appearance Tuesday before U.S. District Judge Robert P. Patterson in New York.

Ms. Leonhart said Mr. Portillo, as president from January 2000 to January 2004, embezzled tens of millions of dollars in public funds, a substantial portion of which he laundered through U.S. and European bank accounts.

She said Mr. Portillo, 61, who had fought the extradition order for more than two years:

• Embezzled about $2.5 million provided in checks from Taiwan’s embassy in Guatemala and drawn on a New York bank account created for the purpose of funding a Guatemalan program to purchase books for school libraries. He endorsed the checks and caused them to be deposited in a bank account in Miami. None of the money from Taiwan was used to buy books.

The indictment said nearly $1 million of the donation was ultimately diverted through a series of transactions, intended to conceal the source of the funds, to bank accounts in the name of Mr. Portillo’s former wife and daughter at a bank in Paris and later transferred to accounts that had been laundered through financial institutions in Luxembourg and Switzerland.

• Embezzled about $3.9 million from the Guatemalan Defense Ministry, arranging for the money to be delivered to one of Guatemala’s national banks, Credito Hipotecario Nacional, to which Mr. Portillo had appointed a conspirator as the bank’s president.

The indictment said that Mr. Portillo, with the assistance of a conspirator, directed the disbursement of the military funds to finance a private land deal, disguise a loan to an associate and issue checks to a company controlled by another conspirator, among other things. The conspirator then transferred part of the money to bank accounts controlled by Mr. Portillo’s former wife and daughter through a Miami bank account.

• Misappropriated funds from the publicly financed reserves of Credito Hipotecario Nacional and his conspirators by creating overdrafts in CHN accounts belonging to companies established by other conspirators. The indictment said Mr. Portillo and his conspirators used overdrafts to withdraw and transfer cash in excess of the accounts’ existing balances. Mr. Portillo used the overdraft withdrawals and transfers to purchase various personal items — including expensive watches and cars — for himself and his associates.

The indictment said Mr. Portillo and his conspirators on other occasions used the overdrafts to transfer and launder funds into business and personal accounts in the U.S. and elsewhere, belonging to conspirators. Relying on the overdrafts, Mr. Portillo also transferred money to help prop up two failing banks that were principally owned by a close associate and political supporter.

If convicted, Mr. Portillo faces up to 20 years in prison and fines totaling $500,000, or twice the value of the monetary instruments or funds involved in the money laundering transactions.



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