Thursday, August 9, 2012

Report: Bain Capital Founded with Support from Salvadoran Elite 'Tied to Death Squads'

An investigation by the Huffington Post fills in some details about the elite Salvadoran families who, in the early 1980s, were among the first investors in Bain Capital, the private equity company once run by Republican presidential candidate Mitt Romney. These four families were prominent supporters of the ARENA party, which funded death squads during El Salvador’s 12-year civil war. Members of the Salvadoran oligarchy are also believed to have directly funded death squads themselves, although there is little clear evidence that directly links Romney’s Salvadoran backers to this activity.

Members of these families were in self-imposed exile in Miami in 1984, when they were first approached by Bain. The Salvadorans are thought to have provided some $9 million of the $37 million used to start Bain Capital.

According to the Huffington Post, one of the original investors includes the Salavierra family, landowners and supporters of ARENA. In 1984, former US ambassador to El Salvador Robert White testified before Congress that two Salavierra brothers directly funded death squads. “They were total backers of [ARENA founder] D'Aubuisson and the extremist solution, including death squads,” White told the Huffington Post.

Four members of the de Sola family were also  believed to be among the original Bain investors, although the Huffington Post says that only two of their identities are confirmed. As detailed in previous reports by the LA Times and Salon, one of the four investors may have included Orlando de Sola,  another founding member of ARENA and who allegedly appears in a 1983 FBI cable as a suspected supplier of funds and weapons to death squads.

Sola is currently serving a prison sentence in El Salvador for fraud, and told the LA Times in July that he was “not part of” his family’s investment in Bain Capital. The Romney campaign has also said that Bain had no association with Orlando.

Another de Sola family member, one of the confirmed original investors in Bain, was accused in 1990 of conspiring to assassinate two left-wing activists in Guatemala, although nothing was ever proven in a court of law.
Other Salvadoran families who invested early in Bain -- including the Regalado-DueƱas family, the Alvarez families, and Ricardo Poma -- were leading supporters of ARENA. The Huffington Post argues that even though there is no evidence directly linking any of these families to the financing of death squads, at the time, support for the ARENA party brought with it troubling associations. Democratic pollster Sergio Bendixen, who spent significant time in El Salvador in the 1980s, to the Huffington Post: "If anybody tries to tell you there was a line, a Chinese wall, between ARENA and the death squads, that's just not the way it was.”
The Romney campaign told the Huffington Post that Bain Capital checked the background of the families and found no links to criminal activity.

News Briefs
  • The 18th summit of the Central American Integration System (SICA) begins today in Managua, Nicaragua; the main issues to be discussed include a regional security response to organized crime and drug trafficking, reports La Prensa Grafica. The main question is whether the summit will see any concrete commitments that bring Central America one step closer to forging a more multilateral response to organized crime in the region, such as strengthening the ability of bodies like the Central American Court of Justice to investigate and prosecute criminals. The summit follows the SICA’s previous meeting in June, where the main topic on the table was border security.
  • A day of violent protests in Chile saw 75 people arrested and 49 police injured, after students marched for education reform in Santiago, and a group of vandals set three buses on fire, reports the AFP. The government blamed the damage on the student protesters, with one presidential spokesman declaring that the protest leaders “are opening the doors to vandalism and delinquency,” the AP reports. Student leaders argue that they do not control the vandals who destroy city property during the mass demonstrations. “The government is responsible for this because of its indolence and silence to all the proposals of the student movement,” said the president of the University of Chile’s student federation.
  • Former General Motors Co. workers in Colombia have entered the second week of their hunger strike, after sewing their mouths shut in protest the company’s alleged practice of firing workers who sustain injuries on the job. The company denies these accusations. Workers are also protesting GM job cuts in Colombia, reports the Wall Street Journal.
  • IDL Reporteros on Palcazu, a remote area of the Upper Huallaga Valley used by clandestine drug flights to transport cocaine to Brazil and Bolivia. The Peruvian Air Force have no radar in the zone, which has helped make Palcazu a popular area for drug traffickers to build landing strips for their Cessna aircraft, which may carry up to 450 kilos of cocaine (sold for about $1,000 each in Peru). The article is accompanied by an interactive map showing the criminal clans based in the Upper Huallaga.
  • Miami Herald columnist Andres Oppenheimer argues that Brazil’s biggest ever corruption case, in which 38 former officials of President Lula da Silva’s administration are being tried before the Supreme Court for misuse of public funds, could make President Dilma Rousseff a “role model” for Latin America. “She is going after corrupt politicians, no matter how close they are to her own office,” Oppenheimer states.
  • The AP reports on an emerging trend in Honduras, in which gangs threaten middle-class homeowners with violence if they do not pay extortion fees in exchange for remaining in their homes. While like most extortion crimes, this has been a difficult phenomenon to track because victims are reluctant to report it, there is evidence that hundreds of families have received such threats, and some entire neighborhoods have emptied out as a result, according to the AP.
  • Colombia police arrested Medellin-based crime boss Erick Vargas, alias “Sebastian,” with Defense Minister Juan Carlos Pinzon calling it the biggest blow against criminal organizations so far this year, the Miami Herald reportsMore from InSight Crime.
  • Just the Facts with a new podcast featuring William Goodfellow of the Center for International Policy on the 25th anniversary of the Esquipulas peace accords, which helped bring the civil wars in Central America to an eventual end.