RIO DE JANEIRO, BRAZIL – Three decades ago, Lázaro Báez was a cashier at the Bank of Santa Cruz in the southern province, Néstor Kirchner’s birthplace. He climbed his way up the ladder with his friend’s help. When Kirchner became Argentine President in 2003, Báez left the bank and founded a road construction company that became one of the main contractors of public works during the governments of both Néstor and Cristina Kirchner.
Lázaro Báez ate with Néstor Kirchner at his last dinner and was the man who built the mausoleum where the remains of the ex-president rest, deceased in 2010.
On Wednesday, Báez was sentenced to 12 years in prison for the nearly US$55 million money laundering scheme known in Argentina as “the K money route”. His eldest son, Martín, the only one still imprisoned, was also sentenced to 9 years.
The Prosecutor’s Office had called for the entrepreneur to be sentenced to 12 years’ imprisonment and fined US$2.121 million. Despite the change of government, the lawsuits on behalf of the Executive had also requested very high sentences: the Anti-Corruption Office had asked for 8 years and 6 months; the Financial Information Unit (UIF) for 9 years; and the AFIP (revenue service) for 8 years.
After almost two and a half years of trial, Federal Oral Court 4 – comprising judges Néstor Costabel, Gabriela López Iñíguez and Adriana Palliotti – also convicted attorney Jorge Chueco and accountant Daniel Pérez Gadin. Both were sentenced to 8 years in jail.
In the case of Leonardo Fariña, the court decided to sentence him to 5 years due to his signing a leniency agreement. “The sentence was reduced by 3 years for his role as a cooperating defendant,” said the presiding judge, in charge of reading the verdict from his office in Comodoro Py.
The judicial investigation began in April 2013, at that time led by judge Sebastián Casanello and prosecutor Guillermo Marijuán, based on a report by the Periodismo para Todos (PPT) TV program that pointed to the network of bank accounts opened abroad and the scheme, through the purchase of bonds, to bring the money back to Argentina, just when Báez needed to capitalize his company in order to be able to continue the construction of two dams in Santa Cruz. This is a case with political implications due to the entrepreneur’s closeness to the Kirchner family.
During the trial, the transfer of money in Báez’s private planes from the South to Buenos Aires, and the purchase of the “El Carrizalejo” farm, in the province of Mendoza (known as fact B) were also discussed. The other farm, known as “El Entrevero”, was left aside for a separate trial.
Total sentences:
1) Lázaro Antonio Báez, 12 years
2) Jorge Oscar Chueco, 8 years
3) Daniel Rodolfo Pérez Gadín, 8 years
4) Jorge Leonardo Fariña, 5 years
5) Martín Antonio Báez, 9 years
6) Leandro Antonio Báez, 5 years
7) Melina Soledad Báez, 3 years
8) Luciana Sabrina Báez, 3 years
9) Walter A. Zanzot, 5 years
10) Julio Enrique Mendoza, 6 years
11) Claudio Bustos, 4 years and 6 months
12) Eduardo César Larrea (acquitted)
13) Walter Santiago Carradori (acquitted)
14) Fabián Virgilio Rossi, 5 years
15) Federico Elaskar, 4 years and 6 months
16) Juan Carlos Molinari, 4 years and 6 months
17) Mario Lisandro Acevedo Fernández, 5 years
18) Daniel Alejandro Bryn, 3 years
19) Juan Ignacio Pisano Costa, 2 years
20) Sebastián Ariel Pérez Gadín (acquitted)
21) Alejandro Ons Costa (acquitted)
22) César Gustavo Fernández, 5 years
23) Jorge N. Cerrota, 2 years and 6 months
24) Christian Martín Delli Quadri (acquitted)
25) Eduardo Guillermo Castro, 5 years
26) Marín Andrés Eraso, 4 years and 6 months
27) Juan Alberto De Rasis, 6 years
Wednesday’s session began with the last statements of Martín Andrés Eraso and Juan Alberto De Rasis, two ex-employees of the Swiss banking group Lombard Odier who were involved in the operation to send part of the Austral Group’s money to that country. Then, presiding judge Néstor Costabel ordered a fourth recess until 1:30 PM.
Two years and almost four months have elapsed since the first hearing. In all this time, almost 100 witnesses have testified, attorneys have resigned, two defendants have been included in the trial, and the three main defendants, Lázaro Báez, Jorge Chueco and Daniel Pérez Gadín, were released from prison.
The K entrepreneur threatened several times to disclose his secrets, but eventually praised his friend Néstor Kirchner. Today, the only one detained in the case is Báez’s eldest son, Martín, who remains in custody until the first week of March.
The Oral Federal Court 4 was to issue the verdict two weeks ago but surprisingly adjourned it for yesterday, triggering a wave of speculations.
After long debates, the court ultimately failed to disclose the predicate offense considered when establishing the money laundering scheme.
During his argument, prosecutor Abel Córdoba mentioned fraud through public works, which is being judged in the Vialidad case – where Vice-President Cristina Kirchner is one of the main defendants – and tax evasion by Austral Construcciones, which is still under investigation in the Bahía Blanca and Federal Capital courts. The three plaintiffs, with some differences, concurred on those crimes.
“If the judges say that Báez’s money came from public works, they will have seriously implicated Cristina,” said a court source before the verdict.
Another scenario could lead to the court deciding to rely only on tax evasion. In that case, another legal debate arises. “There is much debate as to whether the crime of evasion can be a predicate offense because the State grants moratoria. In fact, Austral is in a moratorium and is paying it,” explained one of the main attorneys in the case.
During the arguments, Báez’s defense denounced “a state and parastatal intelligence operation, with the involvement of all media”. Báez’s attorney Juan Martín Villanueva, argued that “the case has a political goal” and reviewed several newspaper covers to conclude that “they sought to involve ex-president” Cristina Kirchner in the case.
The entrepreneur’s defense, along with other attorneys, also tried to overturn Leonardo Fariña’s testimony, the repented witness who changed the course of the investigation. However, the prosecutor and the three plaintiffs’ attorneys defeated the strategy.
Last December, Córdoba referred to the decision of the Chamber of Cassation that ratified the constitutionality of the “repentant” law. “Fariña’s statement met the requirements of the “repentant” law. The trial is ending, any questions regarding the agreement were upheld by the court. Fariña testified in four hearings,” he said at the time.
The trial began on October 30th, 2018 with 25 defendants, but it ends with 27. In May 2019, the TOF 4 decided to add Martín Andrés Eraso and Juan Alberto De Rasis.
The trial was scheduled to take a year, but the number of defendants and witnesses delayed proceedings. Then the quarantine came and the back and forth through the remote system. The proceedings were only resumed on July 21st last year, with the arguments of the Anti-Corruption Office (OA).
Báez will be watching the last hearing from the “secret” residence where he has been under house arrest since September, when the TOF4 granted him the benefit following a specific order of the Court of Cassation. The entrepreneur first tried to live in the Ayres del Pilar country house, but neighbors did not allow him entry. After the scandal, he was moved to a house, where he is permanently guarded.
It was only toward the end of the trial that the entrepreneur tried to disassociate all of his children. “Lázaro made decisions together with his associates and not with his children,” said his attorney. It didn’t work.
Source: Infobae