Federal Judge Julián Ercolini determined that former President Cristina Fernández de Kirchner must be called into questioning yesterday in relation to an accusation made by Deputy Elisa Carrió in 2008, citing her for allegedly unlawfully giving businessman Lázaro Báez public works contracts during her administration.
Ercolini also set out to prevent the former president from selling her assets until the case is clarified, in order to avoid the possibility of her declaring bankruptcy should she be found guilty and have to compensate the State. October 20th is the date set for Cristina to appear before the judge, who will then have to decide whether to formally press charges against her and carry on with the investigation or dismiss it.
Former Planning Minister Julio De Vido, Lázaro Báez and the now (in)famous former Public Works Secretary, José López have also been called into questioning to determine their possible responsibility for what the prosecutors investigating the case, Gerardo Pollicita and Ignacio Mahíquez, have called a “systematic plan to loot the state coffers”.
The investigation is trying to determine whether the Kirchner administration knowingly and unlawfully gave Báez 80 percent of the public works project that were supposed to be carried out in Santa Cruz Province between 2003 and 2015 — which amount to AR $16 billion — in order to get a percentage of the benefits back and thus embezzle public funds.
“There are enough elements to move forward with the process and call [the former officials] into questioning,” reads Ercolini’s ruling.
According to the prosecutors’ investigation, members of the Kirchner administration appointed people to several state offices that managed public works contracts that were later given to Báez: “This way, once the structure was set up, the next stage involved choosing the territory where the operation would be carried out. As we said, it consisted in concentrating the largest sum of state funds destined to public works in one place: Santa Cruz,” notes the request.
Moreover, the prosecutors argue that Santa Cruz was effectively the province that benefited the most by the public works’ cash, having received 11.2 percent of the country’s entire budget for the line item: “In order to have a real dimension of what this implicates, Santa Cruz got what eight other provinces received together. It even got 11 percent more funds than the Buenos Aires Province, the largest and most populous in our country.”
And it wasn’t just about awarding the contracts themselves, according to the prosecutors who say that Báez’s flagship company, Austral Construcciones, received preferential treatment in terms of oversight because the State never verified that the projects had in fact been completed and did not penalize any delays.
The prosecutors allege that it’s likely at least some of this AR $16 billion ended up in the pockets of the former presidents’ family. This ill-gotten money would have then been laundered through different fronts such as the hotel Fernández de Kirchner owns in Santa Cruz, called Alto Calafate, or her real estate company, Los Sauces. In fact, there are two separate investigations — both of them initiated by National lawmaker Margarita Stolbizer — trying to determine exactly that.
Even if Ercolini lets the former president off the hook, however, her judicial woes would be far from over. The former president is currently under investigation in several other cases — some of which overlap with this one — that are trying to determine if she defrauded the state or embezzled public funds in another way. Let’s take a look:
- K Money Trail: Also known as the Lázaro Báez Case, this case seeks to investigate money that was allegedly laundered under the administrations of former Presidents Néstor Kirchner and Cristina Fernández through government contracts given to Lázaro Báez’s construction company, Austral Construcciones. The company allegedly billed projects at significantly higher rates than what the services provided are thought to cost. The case is particularly relevant because, as some have claimed, the people involved in the alleged money laundering activities could not have gone under the radar without help from high places. The former president, however, hasn’t been formally accused in the case even though Prosecutor Guillermo Marijuán requested Judge Casanello do just that. Read more: Judge Casanello Ordered To Further Investigate Cristina In ‘K Money Trail’
- Hotesur: Hotesur is a company that managed hotels in Santa Cruz Province that belong to the Kirchner family. Initially flagged for not paying taxes, later investigations refocused the case around an alleged money laundering scheme by businessman Lázaro Báez. He is suspected of having used the hotels as a front for laundering by renting two rooms for two years, racking up a AR$15 million charge, but without ever actually occupying them. Báez is currently behind bars and is awaiting trial for the “K Money Trail” case. Read more: Judge Bonadio Moves the Hotesur Case Forward
- Los Sauces: Much like Hotesur, this case is looking into whether the real estate company owned by the former President embezzled state funds by placing the money into a “front.” While in Hotesur, Báez’s flagship company, Austral Construcciones, allegedly used rooms in the presidential family hotel Alto Calafate as the front, Los Sauces allegedly rented real estate to companies owned by the former president’s main business allies: Lázaro Báez and Cristóbal López. Báez is also being investigated in the Hotesur and “K Money Trail” cases. Read more: Cristina Kirchner’s Properties Raided As Part Of ‘Los Sauces’ Investigation