BERLIN: February 10, 2016. Following public submissions, global watchdog Transparency International (TI) has launched a “social sanctioning” campaign against nine of the world’s most symbolic cases of corruption.
The targets are senator Felix Bautista of the Dominican Republic; Zine Al Abidine Ben Ali, former president of Tunisia; the U.S. state of Delaware and its registration of anonymous companies; FIFA; the Akhmad Kadyrov Foundation of Chechnya; the corruption of Lebanon’s government, authorities and institutions; Ricardo Martinelli, former president of Panama and his associates; the Brazilian oil and gas conglomerate Petrobras; and Ukraine’s ex-president Viktor Yanukovych.
TI said the chosen nine out of 383 cases identified by the public were based on their widespread impact on human rights, the need to highlight laws allowing anonymous companies, and those who facilitate corrupt deals.
“Lying, cheating, stealing and fraud are the tools of the corrupt. We want to pursue sanctions against as many of these cases as possible. We cannot single out just one case, they all must be dealt with,” said TI chairman José Ugaz.
TI alleges that the Akhmad Kadyrov Foundation of Chechnya “makes up to US$60 million per month from people, while 80 percent live in poverty”; former Panama president Ricardo Martinelli and his close allies diverted US$100 million from citizens; former president of Tunisia Zine al-Abidine Ben Ali stole up to US$2.6 billion from the country; and former president of the Ukraine Viktor Yanukovych oversaw “millions in state assets [that] ended up in private hands [and] fled to Russia before charged with embezzlement”.
In a related move the U.S. Securities & Exchange Commission has penalized LAN CEO Ignacio Cueto Plaza (right) US$75,000 for authorizing US$1.15 million in payments to a third party consultant in Argentina in connection with LAN’s attempts to settle union disputes with the employees of LAN Argentina, a subsidiary of LAN, in 2006. He neither confirms nor denies the SEC allegations.
Chilean-born Cueto has been CEO of LAN since 2012. From 1995 to 1998 he was president of LAN Cargo, based in Miami, and from 1999 to 2005 was CEO of LAN’s passenger business. In 2005, Cueto became president and COO of LAN Airlines until the merger of LAN and TAM in June 2012.
According to the SEC, as part of a deal that LAN reached with the Argentine government in March 2005, the airline was required to hire between six and eight hundred employees from the state-owned LAFSA and Southern Winds airlines that subsequently became LAN Argentina. The SEC says the five unions involved had no hesitation in seeking wage increases following the acquisitions, and by 2006 LAN’s management was involved in negotiations that eventually resulted in work stoppages, slowdowns and strikes by the pilots’ and mechanics’ unions.
Cueto responded by agreeing to pay a consultant US$1.15 million to settle the disputes. The SEC alleges he understood it was possible the consultant would pass some of the money to union officials. By August of that year, the strikes were over and all the unions had settled for wage increases less than their original demands.
As part of his settlement with the SEC, Cueto has agreed to attend all anti-corruption training sessions required for senior executives at LAN.