Chile's Internal Tax Service filed a criminal complaint against former ruler Augusto Pinochet after an investigation of his accounts at Riggs Bank in Washington. Riggs, which was not a subject of the complaint, is facing multiple probes into its compliance with laws designed to prevent money laundering.
In a statement released yesterday, the tax agency said it forwarded the complaint to Judge Sergio Munoz, the magistrate investigating possible corruption by Pinochet. The complaint was not made public, but several sources yesterday said it relates to Pinochet's failure to report millions of dollars in investment accounts at Riggs between 1996 and 2002. Munoz will decide whether to prosecute the 88-year-old former general, who is undergoing psychiatric tests to determine his ability to stand trial on human rights abuses.
Also named in the complaint is Oscar Aitken Lavanchy, a lawyer who is Pinochet's longtime business manager. Aitken could not be reached for comment. He has declined comment in the past, though he gave an interview to El Mercurio newspaper in Santiago in September in which he alleged Riggs was responsible for managing Pinochet's money and should take the blame if any laws were broken. Pinochet lawyer Jose Maria Eyzaguirre could not be reached for comment yesterday.
Mark N. Hendrix, a Riggs spokesman, yesterday declined to comment on the Munoz investigation.
Chilean officials began investigating Pinochet's finances after the Senate permanent subcommittee on investigations released a report in July about Riggs's dealings with Pinochet. The report found that Riggs helped Pinochet hide accounts with balances of $4 million to $8 million. Riggs actively managed large sums of money for Pinochet, the report said, and took steps that appeared designed to disguise Pinochet as beneficiary of the funds.
The Department of Justice is investigating possible violations of money-laundering laws by Riggs employees, according to several sources with knowledge of the matter who asked to remain anonymous because the investigation is in its early stages. Riggs has made formal referrals to the Justice Department detailing what it believes are crimes in its handling of Pinochet's money. It was unclear whether Riggs might be required to produce records or whether bank officials might be deposed in the Chilean probe. As yet, Chilean officials have not asked Riggs for any information, according to two sources.
Riggs was fined $25 million in May for failing to follow money-laundering regulations in its dealings with the West African country of Equatorial Guinea and the Embassy of Saudi Arabia. The fine led to later revelations about Pinochet and pushed Riggs to pursue a merger with PNC Financial Services Group Inc. Riggs's $766 million sale to PNC is scheduled to close in the first quarter of 2005.