Originally: Report: Aristide diverted millions
Former Haitian President Jean-Bertrand Aristide’s government illegally pumped at least $21 million of his country’s meager public funds into private firms that existed only on paper and into his charities, government investigators allege.
The investigators reported that about $2.4 million went directly to charities tied to Aristide and his political party, allowing him to take credit for humanitarian works and strengthening his image as a champion of Haiti’s poor.
But the bulk of the money is still unaccounted for, according to a report by the Central Unit for Economic and Financial Investigations, or UCREF, created by the interim government that replaced Aristide after his ouster last year.
”Instead of contributing to the improvement of the people’s living conditions . . . the Aristide Foundation . . . participated in the erosion and embezzlement of public funds,” said UCREF, created specifically to look into allegations of corruption during Aristide’s term.
Jonas Petit, a top Aristide ally living in South Florida, said the report was part of a witch hunt by UCREF Director Jean-Yves Nol. An experienced financial auditor, Nol had no known political affiliation when he was named to head the investigative unit.
The confidential 69-page report, dated April, does not say whether Aristide, now in exile in South Africa, received any of the money for personal use. Nor does it say how the private enterprises used the public funds.
But it contends that the payments violated government spending regulations and broke Haitian laws on money laundering.
`LAUNDERING OF MONEY’
”Large sums are . . . displaced from one enterprise to another, in order to blur the trail . . . This chain of operations characterizes the laundering of money,” the report said.
The report was submitted to a judge in June as the first step in a possible prosecution of Aristide, who was elected in 2000 but was ousted by an armed rebellion last year. It was obtained by The Herald and authenticated by three people who have copies, including Petit, acting head of Lavalas Family, Aristide’s political party.
Aristide has been under investigation for corruption in Haiti since his ouster. Federal prosecutors in Miami also are looking into whether he took bribes from drug traffickers, The Herald has reported.
The former president has denied all allegations of corruption. Miami lawyer Ira Kurzban, an Aristide advisor, said he had not seen the report and could not comment on it but defended the use of government funds for charity.
”If money is going from the Haitian government to organizations like the Aristide Foundation, which was designed to help poor people, that’s not corruption,” Kurzban said. “There was not one penny spent by the Aristide government that did not go to help the vast majority of Haitians.”
UCREF’s findings could not be independently confirmed and the report has been criticized as poorly written. A similar report by another government organization, the Commission for Administrative Investigations, supports the UCREF report but is considered by some Haitians to be politically biased.
”A lot of facts in it are true,” Gervais Charles, head of the Bar Association in Port-au-Prince, said of the UCREF document. “But it was not a job well done — not the substance, the presentation.”
UCREF’s report said investigators froze about $4.9 million in Haiti bank accounts belonging to some of the 54 people and enterprises it listed as ”suspects.” Attempts by The Herald to contact them were unsuccessful.
The report bases the allegation of money laundering on the elaborate movement of the money — funneled to the three alleged shell enterprises and four humanitarian entities, and then swished around among them in a way that made the origin and destination of the money more difficult to trace.
It said nearly $6 million — both directly and through the alleged shell companies — went to the Aristide Foundation for Democracy, the Aristide University, the Lafanmi Selavi orphanage he founded and Se Pa’n, a food-for-the-poor program linked to his Lavalas party.
Aristide launched the foundation in 1996, and it quickly became the face of his populist programs and headquarters of sorts for Lavalas. UCREF’s investigators say the foundation never filed financial reports and received most of its backing from donors who were bankrolled by the public treasury.
Four years ago, the foundation launched the university as a medical school for poor students, largely using Cuban teachers. The school later evolved into a full-fledged university renamed the Professional and Technical University. Both the university and foundation are closed.
Aristide founded the orphanage in 1986, when he was still a priest. Supporters praise it as helping street children, while critics say it raised members of armed pro-Aristide gangs.
UCREF’s report listed Jonas Petit as a director of Se Pa’n. Four employees of other food-for-the-poor programs in Haiti said they had never heard of Se Pa’n.
Petit shrugged off the report, saying it made him ”laugh.” But he would not discuss Se Pa’n or the allegations in the UCREF report.
FOLLOWING THE CASH
According to the report, the three allegedly nonexistent firms listed by UCREF received $18.6 million from public coffers that remains unaccounted for.
? The largest amount went to VJLS Computer Services and Accessories, which received $14.5 million during the three-year period that UCREF investigated. It also sent nearly $2.6 million to Se Pa’n, the university, foundation and orphanage.
”Our investigation has revealed that VJLS is a fictitious enterprise financed by the funds of the public treasury,” the investigators reported, saying its registered address does not exist.
? Quisqueya Store, another company that UCREF said exists only on paper, received nearly $2.3 million from the government and gave about $523,000 to Se Pa’n, the university and the foundation.
Kurzban said he had heard that Quisqueya bought bulk quantities of rice and sold it to the poor.
? COCSOBFO, listed as a peasant cooperative in the city of Leogane, west of Port-au-Prince, received about $1.8 million in public funds and gave about $568,000 to the university, foundation and orphanage. The report said COCSOBFO did not exist, and several Haitians said they had not heard of it.
Herald staff writer Nathalie Gouillou contributed to this report.