THE DICTATORS' BANK

The Central American Bank for Economic Integration (CABEI) was created to give the region more control over its own development, but a new investigation by OCCRP and partners raises questions about the bank’s lending practices and where their loan money ends up.

We found the bank has funded projects that led to environmental destruction, and others where funds were diverted for corrupt practices or used for pet projects of dictators. Some examples include: 

• Money loaned for hydroelectric dams even after violent crackdowns on protesters.

  • This includes the high-profile murder of Honduran environmental activist Berta Cáceres, who protested the construction of a dam linked to a politically-connected family. 

• In El Salvador, $200 million of one CABEI loan that was meant to provide COVID relief for small businesses was diverted to fund the country’s ill-fated plan to make Bitcoin a national currency.

• Some CABEI loans were used for bribes linked to Odebrecht, a company at the center of “Operation Car Wash,” which began with firms illegally accessing public works contracts in Brazil and then spread across Latin America.

🌐 The Big Picture: This month, CABEI will appoint a new executive president who will lead the bank for the next five years. One of the likely candidates is the bank’s current vice president, Guatemalan economist Jaime Roberto Díaz Palacios, who has already assumed many of the outgoing leader’s functions. 

⚡ Real World Impact: Taiwan is one of a handful of non-Central American members of CABEI. The country’s  Finance Ministry released a statement responding to OCCRP and partners’ “reports accusing the Central American Bank (CABEI) of fostering corruption and authoritarianism.”

>> Read the full investigation

MORE OCCRP IMPACT

🇺🇸 USA: Local officials in Chicago agreed to an independent review of the city’s police after OCCRP and partners exposed ties between law enforcement and the Oath Keepers, an extremist far-right group.

The revelation has triggered renewed calls for the federal and local governments to adopt explicit policies prohibiting membership in extremist organizations. 

THE OCCRP NETWORK

🇮🇳 India: The Gujarat government has summoned two Indian journalists in our network, Ravi Nair and Anand Mangnale, for questioning related to their explosive investigation into the Adani Group, a massive Indian corporation that’s perceived to be close to Prime Minister Narendra Modi.

🇷🇺 IStories: The Kremlin has tried to avoid forcing people to fight in Ukraine, instead opting to promise money to those who sign up to be a soldier. Our Russian member center reports how this “volunteer” system targets immigrants, the impoverished, and the developmentally delayed. Many are skeptical that these people will ever get paid the money promised. 

🇳🇱 Follow The Money: Our Dutch partner helped produce an animated video showing how the global financial system works, including how currency is minted, and where the money typically flows.

🏆 Big Award: Our Lebanese colleague Riad Kobaissi has been selected for the ICFJ’s Knight International Journalism Award, one of the most prestigious prizes for reporters. Riad has worked with OCCRP on multiple investigations, including:

• Lebanon’s Offshore Governor: The overseas wealth of the country’s former Central Bank Governor Riad Salame, who now faces a slew of criminal accusations

• The Origins of the Beirut Blast: The owner of the ship that abandoned the cargo of ammonium nitrate that exploded in 2020, killing over 200.  

FOLLOW THE MONEY NEWS

🏦 ‘Grey List’ Updated: The Financial Action Task Force — a global anti-money laundering authority established by the G7 — has removed the Cayman Islands, Panama, Albania, and Jordan from its list of countries where financial transactions may require further scrutiny. Meanwhile, Bulgaria was added to the so-called “grey list.”

The FATF designation of countries that require “increased monitoring” sometimes results in less foreign investment, and can affect loan packages from the International Monetary Fund and World Bank. 

🇫🇷 France Detains Russian Oligarch: Banking tycoon Alexey Kuzmichev has been detained in France for alleged tax evasion, money laundering and sanctions evasion. 

Kuzmichev has been engaged in a legal battle with the French government over its seizure of his yacht immediately after Russia’s full-scale invasion of Ukraine. 

CORRUPTION NEWS

🇸🇦 A Saudi World Cup: Saudi Arabia will almost surely host the 2034 World Cup after launching an aggressive behind-the-scenes lobbying campaign with FIFA officials. Sources connected to the football organization say sudden requirements and deadlines effectively prevented a competitive bidding process. 

🇵🇬 Australia and PNG Refugees: Papua New Guinea authorities will investigate a series of graft allegations made against a local refugee program largely funded by Australia. A whistleblower told the Guardian that the PNG government misused millions of dollars allocated to supporting refugees, many of whom have been trying to get to other countries for years. 

🇪🇺 Push for EU Anti-Graft Watchdog: France is lobbying for an independent authority to investigate and prosecute corruption in European Union institutions. The authority would be based on a local French agency that has the power to examine public servants’ bank accounts to make sure there are no conflicts of interest.

GLOBAL CRIME NEWS

🌏 Mekong Casinos: Voice of America reports that the United Nations is concerned that Southeast Asia’s booming online gambling industry is being used to launder money from transnational crime groups. 

🇻🇪 Venezuelan Prisons: Authorities said they’ve regained control over the third prison in Venezuela that was seized by a criminal group. A local non-governmental organization alleges they accomplished this through an agreement with gang leaders.