“Los Monos” gang created companies to launder money from prison

The financial business behind the narco drama: growing reports of suspicious financial operations in Rosario.

Reports of suspicious financial operations in Rosario are piling up in parallel to the homicide rate, which went from 18.5 to 22 cases every 100,000 people in the last year. Such is the trend revealed by the Financial Information Unit (UIF). The advance of criminal gangs is taking place together with a financial thread that has operated for a long time “laundering” money from illegal grain sales. While investigations are progressing, the businessmen involved are not in jail. Incredibly, the members of “Los Monos” gang kept creating shell companies to launder money from prison, through an instrument created during [former president] Mauricio Macri’s administration. 

The murder victims of Rosario’s drug trafficking are also the result of a financial equation, a huge illegal business that became a regular thing and has spread its tentacles. 

“The same platforms that were used in the last decades to launder money from illegal grain trade are now being used by criminal gangs. It’s a market that has grown  exponentially since 2010,” a qualified source in charge of these investigations said.  

They’ve also detailed that some of the businesses narcos prefer to set up in order to launder money from illegal activities are bars, real estate agencies, and tourism companies, although the most efficient front is in the financial sector, which involves even renowned brokers from Rosario’s financial world. They do this in the form of mutual societies, trust funds, money market trading desks or even illegal currency exchange operations. In some cases, they grant loans with monthly rates of up to 30%. In others, they operate through check discounts. 

Far from being a solution to an infinitely bigger problem, setting an UIF delegation in the city aims to speed up the institutions’ ongoing effort. 

“In the last few years, the amount of reports of suspicious operations in Rosario have multiplied. At the same time, the city has some of the largest amounts of registered tax payers,” said the UIF ruling published in the Official Gazette.   

Los Monos, “entrepreneurs”

In October 2021, Ambito Financiero revealed that “Los Monos” created around 40 shell companies in 2018, all registered under the Sociedades de Acciones Simplificadas (“simplified corporations”, or SAS) regime. This was an option created during the Macri administration that entrepreneurs used in order to register a company in 24 hours, with no controls, no initial capital and no obligation to specify its commercial purpose. 

Through that procedure, the narco gang issued some 12,000 fraudulent invoices and laundered more than AR$ 1.2 billion. 

The maneuver has been formally identified in an investigation by the Inspección General de Justicia (Legal Registry, or IGJ). According to its records, there was no monitoring of any kind when the narco gang registered these companies, and they were never supervised by human persons. The Director of Societies of the IGJ, Darío De León, said that criminals continued to create companies while in jail. 

“From prison, these people submitted a SAS company every week, and the system allowed that because it was fully automated. Since people were able to do it online, someone on the outside had the passwords, and so they continued operating,” the official explained.  

The IGJ decided to change the registering system in order to tighten controls. They did so using hard data. 

“One of every six SAS is under suspicion of issuing fraudulent invoices, it’s not an isolated case,” said De León, who added that “monitoring legal persons is also part of the fight against drug trafficking”. 

Investigated at home

A series of events connect the Rosario financial universe with the drug dealers’ activities. One of the most highlighted cases involved Patricio Carey, head of the company Cofycro, located in Rosario downtown. The story began in September 2020, when narco and Newell’s barrabrava (football hooligan) Marcelo “Coto” Medrano was killed, and police found messages in his phone revealing that only hours before being killed, he had illegally purchased US$ 17,000 from Carey. 

Police raided several homes connected to Carey, where they found at least 174 ID cards that had been reported lost or stolen, and were used to buy dollars at the official exchange rate. That currency was later sold in the black market. 

“In the end, cocaine is a commodity you pay for in dollars. Gangs need someone to purchase them from,” said federal prosecutor Federico Reynares Solari in an interview with local radio station Sí 98.9.

Despite being charged with concealment and money laundering, Carey traveled last November to Qatar to support the Argentine football team. In early December, following Lionel Messi’s team win at the World Cup, the businessman returned to Argentina and was immediately arrested in Ezeiza airport, charged with witness tampering.   

Carey was in prison for a brief period of time. On January 6, during the judicial summer recess, Judge Guillermo Llaudet decided to release him and refer the case to an exceptional federal court. Hours later, Rosario media ran an advertisement for a Carey group company promoting a fundraising effort for a trust fund that would finance the construction of a five-star hotel in town. 

Carey is not the only important name from the business world that is under scrutiny. The former head of the Rosario Port Terminal, Gustavo Shanahan, is also charged with being part of a drug dealing scheme for illegally selling dollars to Los Monos. In the middle of a heavy devaluation of the peso that occurred in mid-2019, prosecutors of the case obtained access to communications between the narcos, who appeared concerned over losing money with the jump in the exchange rates.  

Shanahan is currently in house arrest, awaiting his sentence. A source with knowledge about the case said the decision to grant him this benefit was influenced by “the rooting criteria”. That is, staying close to the assets he has in the country. A curious contradiction, since the investigation is focused precisely on that fortune he obtained through a criminal behavior.  

“It’s easy to jump on the people who members of the judiciary don’t see as part of their own class, and investigate the crimes committed in the least favored neighborhoods of Rosario by people who don’t frequent upper-class social circles,” said prosecutor Federico Reynares Solari. 

“Yet the blood from violent crimes in marginalized communities is the money that is in dispute downtown between much more complex structures that have lawyers, accountants, and businessmen”. 

Originally published in Ambito.com / Translated by Agustín Mango


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