Bank bosses jailed for crippling Dominican economy
Three Dominican banking executives were convicted for their roles in a financial collapse that crippled the Caribbean country's economy.
The trial focused on the management and 2003 collapse of the country's largest bank, Banco Intercontinental, which prompted a costly government bailout and led to the collapse of two other large banks as international lenders helped prop up the Dominican economy.
Ramon Baez Figueroa, ex-president of Banco Intercontinental, or Baninter, was found guilty of concealing information from the government as part of a massive fraud scheme, fined 65m Dominican Republic Pesos (€1.35m) and sentenced to 10 years in prison.
The bank's financial adviser, Luis Alvarez Renta, was convicted of money laundering, fined 620,000 pesos and (€12,880) sentenced to 10 years. Former bank vice president Marco Baez Coco, convicted of fraud, will be sentenced on November 16.
Two other defendants, Vivian Lubrano and Jesus Maria Troncoso, were acquitted on all charges.
Baninter collapsed after losing 55bn Dominican pesos, €1.57bn at the time.
The resulting central bank bailout spurred 30% annual inflation and a large increase in poverty. The government was forced to devalue the peso, triggering the collapse of two other banks, and prompting a 20.5bn peso (€430bn) loan package from the International Monetary Fund.
The banking crisis jolted Dominican society, igniting struggles between powerful families. Some of the harshest fights were over the bank group's media outlets, including the prominent newspaper Listin Diario, which was temporarily seized and run by the government following the banking crisis.
Voters ultimately blamed the troubles on President Hipolito Mejia and political allies. President Leonel Fernandez was swept into power on a platform of fiscal reform in 2004, and his party took control of congress last year.
In recent weeks, civic groups and transportation unions marched through the Dominican capital of Santo Domingo demanding guilty verdicts and handing out lists of those alleged to have benefited from Baninter's collapse.
The court in Santo Domingo overflowed with people as the verdicts were announced. Relatives of Alvarez Renta, a nephew of fashion designer Oscar de la Renta, cried as the conviction was announced for the bank's financial adviser.
Alvarez Renta had already been found liable in US federal court in Miami for racketeering and fraud in Baniter's collapse. A Panamanian bank also filed a complaint in New York State Supreme Court against him in August for loan fraud.
Baez Figueroa and Alvarez Renta said they would appeal against their sentences.
"The sentence is an error," Renta told the online newspaper Clave Digital after the verdict was read.
