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Latin America

Guatemalan anti-corruption effort under attack, accused of colluding with the Kremlin

Two anti-corruption causes collide in bizarre court battle in Guatemala over jailed Russian exile family. U.S. funding for highly-regarded anti-corruption unit, known as CICIG, placed on hold at request of U.S. Senator Marco Rubio.
13 May 2018 – 11:10 AM EDT
Igor Bitkov (l) with his family, son Vladimir, wife Irina, and daughter Anastasia (r) Crédito: Courtesy of the Bitkov family

Iván Velásquez Gómez and Bill Browder are both anti-corruption crusaders, having bravely gone up against powerful institutions, one a Colombian prosecutor and the other a former businessman in Russia.

But now they find themselves on opposite sides in a puzzling case of colliding causes that has cast doubt on a highly valued international effort to root out impunity in Guatemala.

Last week, at Browder’s behest, U.S. Senator Marco Rubio (R-Fl) sought to block $6 million in federal funding for the United Nations-backed judicial body, CICIG, the International Commission Against in Impunity in Guatemala, which is headed by Velásquez.

Rubio’s action was related to CICIG’s alleged role in helping to prosecute the family of an exiled Russian millionaire, Igor Bitkov, former owner of a wood pulp and paper business who fled to Guatemala in 2009 to escape alleged Kremlin persecution.

Bitkov, his wife Irina, and daughter, Anastasia, are currently fighting a hefty jail sentence for obtaining fraudulent passports and other documents to obtain residence in Guatemala.

Rubio also wrote to Guatemalan president Jimmy Morales saying he was concerned about “CICIG’s ability to remain free from the corruption that it has been charged with prosecuting.” He requested that Morales examine CICIG’s role in the Bitkov case, “especially its possible collusion with the Russian government and related Russian entities.”

It was Browder who brought the Bitkovs to the attention of Rubio. An American-born financier, Browder also made his fortune in Russia before falling out with the Kremlin. He has since been a thorn in the side of the Russian government, backing victims of President Vladimir Putin. His 2015 book, Red Notice, a real story about finance and murder in Putin's Russia, was a best-seller.

But now, to the consternation of many fans of CICIG’s work in Guatemala, Browder has accused the anti-impunity commission of colluding with the Kremlin to hound the Bitkovs.

It’s a charge many human rights advocates find hard to believe, given CICIG’s achievements over the last decade confronting entrenched corruption in Guatemala, bringing down a string of crooked officials and politicians, including two former presidents and a vice president. CICIG’s Velásquez is a widely respected Colombian jurist, noted for prosecuting feared right-wing paramilitaries in his own country.

The involvement of Rubio comes just as CICIG's foes in Guatemala, including President Jimmy Morales, have themselves come under investigation for corruption. Supporters of CICIG fear Rubio's actions could embolden the commission's enemies. On Thursday, the Guatemalan government requested that Sweden and Venezuela remove their ambassadors for foreign 'interference" (injerencia) after they voiced strong support for the CICIG. Sweden is one of the largest donors of funding for the commission.

"Pretty preposterous"

“The idea that there is some collusion between CICIG and the Kremlin is pretty preposterous,” said Daniel Wilkinson, managing director of the Americas division at Human Rights Watch. “It’s very unfortunate because CICIG has a pretty remarkable track record in Guatemala. It is one of the unusual success stories in the fight against corruption.”

The CICIG provides legal assistance to the Guatemalan Attorney General’s Office on high level corruption and crime cases. The U.S. government has traditionally provided close to half of CICIG’s estimated $15 million annual budget, and is a strong advocate of its work.

“CICIG plays an important role in tackling the corruption that undermines security, prosperity, and governance in Guatemala,” a State Department spokesperson told Univision. “We commend its vital work to strengthen justice sector institutions, and combat corruption and impunity in Guatemala.”

Even so, last month the U.S. Congress held a hearing asking the question: “Did a UN commission founded to fight corruption help the Kremlin destroy a Russian family?”

Among those who testified was Browder. The American-born hedge fund manager is CEO of Hermitage Capital Management, once the largest foreign investor in Russia. Now living in London, he is credited with being the driving force behind the so-called Magnitsky Act, a 2012 U.S. law which targets Russian human rights abusers. It was originally created to target Russian officials responsible for the death of Browder’s tax accountant, Sergei Magnitsky, in a Russian jail.

“I have no axe to grind with CICIG,” Browder told Univision News in a phone interview from England, where he lives. “I come into the story without any prejudice. I’m not a fan or an enemy.”

Browder and Rubio particularly question the unusually severe sentences given to the Bitkovs over their illegal passports. Igor Bitkov was sentenced to 19 years, while his wife and daughter got 14 years.

$50,000 passports

Browder says the Bitkovs were forced to flee Russia in 2009 after state banks illegally seized their successful paper company, one of the country's largest. The decision to abandon Russia was made after their daughter was kidnapped and raped. They chose Guatemala as it does not have an extradition treaty with Russia. But, in what turned out to be a serious error of judgment, they acquired Guatemalan passports under assumed names, paying $50,000 each.

One of the banks, VTB, accuses Bitkov of non-payment of a loan, a claim which Browder says is based of forged documents. Browder said VTB tracked Bitkov down and filed charges in Guatemalan court.

“VTB and other Russian corporate raiders don’t just steal their victim's assets but make every effort to destroy their victim's lives. It’s a standard Russian practice,” Browder said.

The Bitkov's were arrested after their passports turned up in a major corruption investigation of the national immigration office. The family blames their legal issues on a local law firm which they say handled their immigration affairs. The Bitkovs assumed that their new documents were legally issued and there were never any allegations that they bribed government officials, according to Browder.

In fact, the Bitkovs say they were victims of fraud, adding that they are also the only purchasers of illegal documents to be prosecuted in the case, out of 39 people targeted so far.

“It continues to defy logic why a family fleeing persecution in Russia would be prosecuted along with a human trafficking network in Guatemala and receive jail sentences for passport violations which exceed the average jail sentences for murder or rape in Guatemala,” said Browder.

In April, Guatemala’s Constitutional Court annulled their conviction, forcing prosecutors to re-try the case, though they remain in jail.

The CICIG strongly denies mishandling the Bitkov case and says the accusations against it “are largely biased and do not conform to reality.” In a detailed written defense of the case on March 29, the commission said the Bitkov's problems in Russia "were not part of the investigation." It added that Bitkovs failed to seek asylum when they entered the country and "did not submit any document or evidence regarding past events in Russia or a possible situation of risk."

Browder contends that is not true. He provided copies of letters and other documents indicating that authorities were made aware of the Bitkovs' problems back home. He also pointed out that VTB was one of several Russian state banks slapped with sanctions in 2014 by the U.S. Treasury Department over Moscow’s support for separatists in eastern Ukraine. It has since been hit with further sanctions.

The head of VTB, Andrey Kostin, was also sanctioned by the U.S. Treasury Department in April for his role in Moscow’s "malign activity around the globe.”

U.S. funding

This week, six former senior Guatemalan officials wrote a letter to members of the House and Senate committees handling foreign policy, as well as Secretary of State Mike Pompeo, “to urge the United States Congress to continue its funding for the commission’s work.”

Several members of the U.S. Congress have issued statements of support for continued U.S. funding of CICIG. “We reject all efforts to delegitimize CICIG and continue to stand with its Commissioner Ivan Velasquez and the Attorney General’s office as they carry out their crucial work,” two Representatives, Eliot Engel of New York and Albio Sires of New Jersey, said in a joint statement this week.

Senator Patrick Leahy, vice chairman of the Senate Appropriations Committee, also offered his wholehearted support to Velasquez, whom he called "a person of great integrity." In emailed remarks to Univision News, Leahy added: "there is bipartisan agreement in Congress that CICIG needs to continue its work, under the leadership of Mr. Velasquez. And that is what a majority of the Guatemalan people want."

An aide to the Senate Foreign Relations committee told Univision News that the allegations by Rubio were receiving "appropriate oversight ... to ensure U.S. participation supports our interests for addressing systemic corruption in Guatemala."

It was not clear however how soon the committee will decide on future funding.