Pedro Delgado Campaña,
picture courtesy of Ecuador’s
Central Bank website.
“Su experiencia
profesional también incluye haber sido Intendente Nacional de
Supervisión en Ecuador y Gerente de Riesgos de la Corporación
Financiera Nacional del Ecuador. El señor Delgado obtuvo
una maestría en Economía Empresarial y un post grado en
Administración Bancaria en el INCAE (Costa Rica).”
London, 15.01.2013 – The
paragraph above has been taken from a profile of Pedro Delgado, still visible (as of January 15, 2013) on the Central Bank of Ecuador’s website..
Mr Delgado has resigned from his post as head of the Central Bank of Ecuador upon discovery that his academic credentials were false. Mr Delgado never finished any of the degrees he claimed to have obtained. What is true, however, is that Mr Delgado is cousin of Ecuador’s President Rafael Correa, and enjoys his support.
In
the context of the paragraph above,
the term “obtuvo”
means
having gained or completed, an Master’s Degree in Business Finance, and post
graduate studies in Banking
Administration at Costa Rica’s INCAE. How could Mr Delgado
dupe Ecuador’s Central Bank? How could President Rafael Correa not
know that Mr Delgado, his cousin, never really obtained any of the
academic degrees he claimed to have finished? How come no one from
President Correa’s government or entourage took the trouble of making sure that Mr
Delgado’s claimed academic credentials were legitimate?
Mr
Delgado is a good exhibit of the way in which political appointments
are made across Latin America, where credentials for the job are
totally irrelevant and often sacrificed at the altar of political
expediency.
Pedro Delgado
Campaña’s career has been controversial, and did not start with cousin Rafael
Correa’s assumption of Ecuador’s presidency. In 1999, in the middle of
Ecuador’s banking crisis, Mr Delgado was Credit Risk Manager of Ecuador’s
National Finance Corporation (CFN). In a report commissioned in 2007
by President Correa, entitled “CFN’s Financial Crisis”, published
by La Vanguardia,
it is claimed that Mr Delgado redacted a memo (dated March 19, 1998,
ref. RI 0003736) that modified banks’s credit-risk assessment
criteria. The said reform allowed for “increased flexibility in
acceptable credit terms and guarantees”, with the resulting effect
of CFN granting funds to financial institutions that were in dire
shape. The report states that Mr. Delgado’s reform undermined CFN’s
supervision and credit recovery mechanisms. Following Mr Delgado’s
memo, credit limits for troubled financial institutions were also
lifted. This resulted in CFN granting “more than $1 billion worth
of credits.” CFN’s total losses were estimated at $1.178 billion
[p. 15 or report].
After his position at CFN, Mr
Delgado was Manager of Financial Institutions of Ecuador’s
Superintendency of Banks (Superintendencia de Bancos). Mr
Delgado is believed to have also been one of the key figures behind the
fusion of banks Filanbanco and La Previsora, which ended up costing millions of dollars in losses to thousands of Ecuadorians. Mr
Delgado also fabricated evidence, and authored at the time biased financial reports regarding
Filanbanco, Banco Popular and Banco Progreso,
which prompted intervention, assets confiscation and expropriation by the Ecuadorian State.
Nicolas Landes, owner of
Banco Popular, subsequently sued Mr Delgado for falsification of public
documents. A judge from Quito ordered the arrest of Mr Delgado in
September 2000, after which he escaped to Miami, where he lived in self-imposed exile for a number of years.
Then in 2007, his cousin Rafael
Correa won Ecuador’s presidency on a platform of sweeping reforms,
including promises in the financial sector. Amazingly, despite the huge cost of previous actions, illegal activities and his association to Jamil Mahuad’s administration (object of much criticism by Correa), Pedro Delgado became President Correa’s trusted advisor in financial matters. So much for a break with the corrupt past…
As previously mentioned, a report about
financial irregularities in which Mr Delgado had been involved, sent
to the office of President Correa and to the Attorney General’s
Office, appeared in the Ecuadorian press.
President Correa decided to ignore the findings, though, and rewarded the Delgado family with a series of important appointments. Mrs Delgado was made Ecuador’s Consul in Miami, and her brother, Francisco Endara, was first appointed as Manager of Bank Deposits Guarantee Agency (AGD) and then as
Secretary of CFN-AGD’s No Más Impunidad Trust. Mr Delgado himself, while in exile in Miami, first coordinated Ecuador’s Bank Commission (Junta Bancaria), before going on to have a
meteoric ascent in Correa’s administration.
In 2008, Carl Wolf, at the
time President and CEO of Miami’s Pacific National Bank (PNB), wholly
owned by Banco del Pacifico, which is in turn controlled by
the Ecuadorian government through Ecuador’s Central Bank (BCE),
sued PNB for unfair dismissal. The terms of the lawsuit revolved around Mr Wolf’s refusal to:
make illegal payments to Andres Baquerizo (PNB’s board member and CEO
of PNB’s parent Banco del Pacifico);
hire through third
parties “a known embezzler from Ecuador” (Luis Wilfrido Villacis
Guillen, convicted felon involved in misappropriation of public funds
related to Filanbanco);
reopen bank accounts that had been
closed in observance to U.S. Bank Secrecy Act, Patriot Act and other
federal and anti money laundering directives;
ignore U.S.
Banking and anti money laundering regulations.
Although Mr Wolf’s lawsuit may seem unrelated, it also leads back to Mr Delgado, who, as Director of BCE,
instructed Wolf to “reconstitute trade financing and lending
operations”. According to the lawsuit this was “in contravention
to the agreed upon risk profile that PNB was obligated to follow
pursuant to an applicable Consent Order entered into the United
States Office of the Comptroller of Currency (OCC) and PNB.” Mr
Delgado basically threatened to fire Wolf immediately should he
refuse to implement instructions.
One of the accounts at PNB
that Wolf ordered closed belonged Cassia Delgado, Secretary
of President Correa, and cousin of both President Correa and Mr
Delgado. Mrs Delgado failed to disclose the source of thousands of U.S. dollars paid into her account.
By this time, though, Mr
Delgado had well and truly established himself as a power broker in the nepotistic regime of Rafael Correa. Assets worth billions of
dollars that belonged to the banks that had been intervened and
expropriated in the early noughties -in great part owing to Mr
Delgado’s decisions- were now back in his hands, as he became
Director of CFN-AGD No Más Impunidad, a
vehicle created to administer and dispose of said assets.
Mr
Delgado enlisted his brother in law, Francisco Endara, who was
identified as responsible for a $800,000 credit -without collateral- given to Argentinian Gastón Duzac, via a financial institution (COFIEC) under Mr Delgado’s and Mr Endara’s control. Shortly
after disbursement to Duzac, Mr Delgado made a $200,000 payment for a
house in Miami. Media and journalists covering these issues received death threats.
As Head of Ecuador’s
Central Bank Mr Delgado was also in charge of establishing triangulation mechanisms that -using Ecuador’s banking system and USD-denominated currency market- would have allowed Iran to circumvent OFAC and other international sanctions. Press reports
indicate that Mr Delgado “arrived on April 3 to the Khomeini
airport in Tehran, with a delegation which included his
brother-in-law Francisco Endara, who was coordinator of the Technical
Secretariat of the Trust and now adviser of COFIEC bank (currently a
fugitive due to the irregular loan granted to DUZAC).”
The purpose of the trip is
believed to have been to sell to Iran companies and assets seized by
the government of Ecuador.
The press further reports
that “Seven months after his visit to Iran, Delgado intervened to
facilitate the deposit of the Iranian Embassy, of USD 1.8 million in
cash in COFIEC. On November 15 and 24, 2011, the deposits were made
in a savings account of the Iranian Embassy, USD 112,834, 500,000 and
1’360.000.”
In another trip, Mr Delgado
met with representatives of Pasargad Bank, Export Development Bank
(EDBI), Saman Bank and Parsian Bank, to discuss the sale of COFIEC.
Mr Delgado also met with OFAC-sanctioned representatives of Iran’s Bank Melli in Moscow. Reports claim that, while in Moscow, Mr Delgado
stashed $500,000 in cash in a security box.
All these revelations have
had consequences back in Ecuador. While President Correa had no initial qualms at strongly supporting his cousins [Pedro and Cassia], evidence
kept mounting and finally his nepotism was exposed. Spurred by a Congressman’s denunciations, Ecuador’s Attorney General’s Office has launched four investigations into Mr Delgado for:
illegal
expropriation of companies and money transfers to Switzerland,
doubts
about his estate,
responsibility in banking crisis during his tenure
at CFN,
and illegal purchase of a house in Quito.
In addition, Ecuador requested the United States to revoke Mr Delgado’s visa, which was promptly granted.
Statements from Ecuador’s Foreign Secretary, Ricardo Patiño,
referring to Mr Delgado as a traitor may well be simple posturing.
Whatever the future holds
for Mr Delgado though, it remains troubling that a fully aware President Rafael
Correa, put Delgado at the helm of
Ecuador’s Central Bank, and then protected him, even after he was publicly revealed to be a fraudster, a money launderer. Mr Delgado is a man who has abused the law and his positions to steal
private property. He is an individual whose entire life and record is based on lies
and fabrications, and accordingly has such a dysfunctional moral compass that he deals with Islamic fundamentalists and terrorists. But, perhaps most importantly, he is an individual whose actions in public office have caused billions of dollars in losses to thousands of Ecuador’s citizens.
The «Who Is?» series is a new type of article I shall be posting on a regular basis. Given that this blog has become a source for journalists, bankers performing KYC, prosecutors, immigration authorities, public policy analysts, intelligence agencies, and concerned citizens, I have decided to publish research in a simpler and more comprehensive way. The «Who Is» series is an attempt to provide accurate, factual snapshots of some of the more «colorful» members of the fauna inside corrupt governments and enabling societies. Readers’ suggestions for a «Who Is?» profile can email me at alek dot boyd at gmail dot com.
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