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He put his trust in Switzerland and Citibank

Swiss prosecutors visited Almoloya Prison in December 1995. There, the ex-President's brother described the acrobatics used to conceal the ownership of accounts containing $100 million, and the role played by Citibank executives in setting up offshore companies and trusts.

In his zeal to avoid "political scandal," Raul Salinas de Gortari did everything possible for six years to conceal ownership of bank accounts that eventually built up to the neighborhood of $100 million.

Confronting Swiss Federal Attorney Carla del Ponte, the brother of the Mexican ex-President wove a detailed tale of his financial acrobatics.

In this odyssey he invented fictitious persons, placed complete trust in Citibank, whose ranking executives engineered some of his financial operations; set up paper companies with Swiss bank accounts, took over trust funds inherited by his wife and had dealings with four Swiss banks.

REFORMA is in possession of a copy of the transcript of Salinas's interrogation by Del Ponte and Valentin Rorschacher, head of the Swiss Central Office for Drug Trafficking, which was conducted at Almoloya de Juarez Prison in December 1995 as part of the investigation of Raul Salinas as an alleged participant in money laundering and drug trafficking operations.

During the interrogation, Salinas detailed his Swiss accounts and the names under which they were opened. According to his statement, his money was deposited in Banque Pictet, Citibank Zurich, Julius Baer Bank and Banque Edmond de Rothschild.

The accounts were opened under the fictitious names of "Juan Guillermo Gomez Gutierrez" and "Juan Jose Gonzalez Cadena," as well as a company, Novatone, and the Trocca Limited and Dozart trusts.

At the outset of the interrogation, Salinas expressed his admiration for the European country that was now investigating his financial operations. "It is a country that we have loved and respected for many years. My wife studied in Switzerland, I have taken part in equestrian competitions in Lucerne, my nephews went to school there and two of my daughters are in school there now."

Salinas requested the indulgence of the Swiss prosecutors before answering their questions: "I also want to offer my apologies to the Swiss government and the country's financial institutions...and I'm going to explain why I acted as I did and assumed different identities."

"Basically, because at the time accounts were opened under different names, I was unfamiliar with the system Citibank proposed to me, so fictitious names were used to avoid creating a political scandal; if I had known beforehand about Confidas, Citibank's system, I wouldn't have resorted to fictitious names."

Authorities have identified Confidas as a Citibank subsidiary corporation, legally domiciled in Panama and with offices in Switzerland.

As of this date, officers of this banking institution have repeatedly denied that its executives have engaged in any violation of ethical behavior or financial regulations targeting money laundering.

"We have no reason to believe that we have been involved in illegal or unethical practices," Citibank's spokesman in New York, Richard Howe, stated recently.

Nonetheless, the case against Raul Salinas has led US experts and officials to ask questions about gaps in the legal machinery for detecting the laundering of money from sources other than drug trafficking.

Doubts have also arisen concerning the actions of US banks which accept deposits from foreigners incapable of justifying the source or size of their assets.

In the interrogation, conducted under terms of the mutual legal assistance treaty and transcribed in 16 single-spaced pages, Salinas denies that the funds frozen in Switzerland were the fruit of any unlawful activity.

"I categorically deny the slightest connection with drug trafficking, I deny that these funds could have the slightest connection with the crime of financing the illegal trafficking in drugs," stated the man now under trial for allegedly masterminding of the murder of Jose Francisco Ruiz Massieu and for the crime of unexplainable enrichment.

While continuing to suspect a connection with drug trafficking, Mexican authorities also believe that part of the funds deposited in Switzerland and other countries was obtained from corruption and from commissions that Salinas charged businessmen for contracts with the government headed by his brother.

Such commissions were believed to have been pocketed even after Salinas stepped down from public office in 1992. Nonetheless, Salinas also rejected this charge in the course of the interrogation.

"This money did not come from and has nothing to do with any activity related to my work as a public official; in other words, it is not dirty money, it is completely lawful...there was never any situation of abuse of power or corruption in the institutions where I worked as a public official," the former director of Diconsa asserted.

Salinas gave the same explanation for the origins of the 100-million-dollars-plus [in foreign banks]. "After deciding to organize an association of investor friends, I began constructing various mechanisms for putting together a financial mass which -- after my brother's administration had ended -- would allow these assets to be repatriated to Mexico for various investment projects..."

According to Salinas, the plan was to bring together a group of businessman friends who would put a "financial mass" together outside of Mexico, for reasons of safety and in order not to remain aloof from the political toils of President Salinas's term in office. Some people invested in the form of loans, others as seed money for various projects.

One of the first questions: " In whose name were these accounts opened?" Initially with some confusion, then with greater clarity, Salinas began to provide facts and remember details of the transactions.

With his answers to a dozen questions on the same point, after thinking, repeating himself and tendering a few names that were then supplemented with others, Salinas provided an x-ray of his Swiss fortune.

At Banque Pictet, headquartered in Geneva, an account in the name of Juan Guillermo Gomez Gutierrez. There was another before, now closed, under the fictitious name of Juan Jose Gonzalez Cadena. There should be another under the name of Juan Manuel Gomez Gutierrez, a real person. Margarita Nava Sanchez was one account holder for a group of accounts that existed between 1989 and 1993.

An account at Julius Baer Bank in Zurich in the name of Raul Salinas de Gortari, and another in the name of a company, Novatone. Applications to open these accounts were submitted from Mexico.

A number of accounts at Citibank, Zurich. Salinas could not say how many account holders there were, or their names, because the application was made from Citibank in New York through a Swiss subsidiary, Confidas. There is also a trust called Trocca Limited.

A trust named Dozart at Banque Edmond de Rothschild, "originally set up by my present wife's first husband with funds originating in the inheritance of her husband, Alfredo Diaz Ordaz." There "should also be" an account in the name of Raul Salinas de Gortari at that bank.

Citibank's role in the operations

On a number of occasions during his conversation with the Swiss investigators, Salinas mentioned Citibank, some of its ranking executives and its role in opening accounts in various countries.

For example, he stated that the Citibank Zurich accounts were opened in the name of Trocca Limited, a trust set up through the intermediary of Confidas at the bank's advice.

"Citibank -- specifically, its New York office -- devised the entire strategy with Ms. Amy Eliot, and she knew the first investor who made transfers, and Ms. Eliot's correspondent in Zurich was a woman named Mailey Plange Rohner, who no longer works for the bank."

Salinas also noted that accounts were set up in the US and England in accordance with this strategy, and that Eliot was free to execute these movements, which included the opening of accounts under names not stipulated by Salinas.

"I don't remember the number of the account, but I remember the name. They were among the many handled through Citibank and Confidas officers, as well as through some other bank, but they were opened by bank officers."

"I didn't open them directly. Even today I couldn't tell you what names the officers used to open the accounts, because I don't have all the files," Salinas replied to the question listed as number 17.

Salinas was subsequently questioned about a transaction involving the movement of $25 million.

"As I said, it was an internal movement for optimization of existing assets, given that the $25 million left Zurich...pursuant to an order by the Trocca administrators to invest it in money market instruments, and that they decided to recall the money 25 days later."

With regard to the existence of accounts in a number of countries, Salinas pointed out that "the accounts appearing in London and the US are a part of the group of account structures organized and managed by Citibank."

"And that's the way Citibank New York, Citibank Zurich are structured, for example, they have facilities for opening accounts in London, but these aren't accounts that I opened, they have facilities for opening them anywhere and don't need my direct involvement to do so."

Raul's suspicions concerning Amy Eliot

Salinas was emphatic during his meeting with the Swiss officials. He was speaking in all honesty, he said, because he had nothing to hide, not even the names of his businessmen friends...although he would name them only in private.

He could not understand why Switzerland had lifted and violated banking secrecy, which had been one of the reasons he had chosen this country for his investments.

"Why did Paula Castanon de Salinas go to withdraw the money?"

"Following my instructions, because we were sure that -- since the money had nothing to do with drug trafficking -- the accounts hadn't been frozen.

"If I had been at all concerned, because my accounts had somehow been linked to drug trafficking, I wouldn't have gotten my wife involved. We never expected that someone would have lied and that the accounts would be frozen for the crime of drug trafficking. What we did know was that the Mexican authorities had learned of the existence of a fake passport in the name of Juan Guillermo Gomez Gutierrez, and that the money had to be moved."

"Why did you try to remove the contents of the safe deposit boxes?"

"Because we knew that the fake passport that the Mexican authorities were looking for was in that safe deposit box, along with documents concerning Citibank, and if the Mexican authorities knew about the name Juan Guillermo Gomez Gutierrez, they had to be removed from that safe deposit box."

"Moreover, Amy Eliot advised my wife to move those funds. I suppose that Ms. Eliot wanted to keep Citibank out of this problem, or had been advised of the accusation of drug trafficking, I don't know, but she helped lead my wife into that trap, since we had trust in Swiss banking secrecy."

"Two factors contributed largely to the decision to move those funds: the fact that the Mexican authorities knew about the existence of the fake passport, and Ms. Eliot's advice."

Throughout the interrogation, Salinas denied that all the assets were his, asserting that he simply managed the accounts. "I couldn't say that I was the owner or beneficiary of the total amount," which is "on the order of $100 million," he stated.

"What returns did he receive for managing this group of accounts?"

"The returns would have to be divided into two parts, since the end goal was to generate business with this money...and I was to share in the profits if and when this business was realized, depending on the structure and financing of each deal...My consulting and promotional activity generated significant profits for me to make use of (and which in fact I did make use of), all derived from the management and advice that I provided for each of the investors."

With regard to a series of transaction in 1993, in which about $25 million was transferred to another account, Salinas said:

"I remember having ordered this transfer, which was done through my wife, to a friend for a business deal. I can give you his name at a later time. It was a lawful transaction; moreover, the total amount to the recipient was higher (the $15 million wasn't the total amount). It was just a part, and there was nothing illicit about it.."

"That $5 million was part of this block that was moved, and various conduits were used; that's the way the participants agreed to do it, and we agreed to do it that way because that's how the recipient wanted it, and I think it would be very easy for the Swiss authorities to find out who the recipient was and to realize that the people involved have nothing to do with drug trafficking. The $3 million are a continuation of the $15 million transfer. The $15 million and the $3 million were delivered to the same recipient."

Bank accounts

Accounts opened by Raul Salinas and his pseudonymous alter egos in Switzerland.

[Illustrated: Copy of the account application filled out by his amphytrion, Juan Guillermo Gomez Gutierrez, for Banque Pictet.]

Banque Pictet, Geneva

Account in the name of Juan Guillermo Gomez Gutierrez.

Account in the name of Juan Manuel Gomez Gutierrez.

Juan Jose Gonzalez Cadena (closed).

Margarita Sanchez Nava (closed June 1993).

Julius Baer Bank, Zurich

Account in the name of Raul Salinas de Gortari.

Account in the name of Novatone, a corporation.

Citibank, Zurich

Various accounts opened by Confidas, a Citibank subsidiary. One in the name of Trocca Limited trust.

Banque Edmond de Rothschild

Account in the name of Raul Salinas de Gortari.

Account in the name of the Dozart trust.

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