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May 22, 2001

The Citigroup-Banamex Merger

Breaking The Information Blockade

The Mexican Press Speaks:

Narco News 2001

The Dean of Mexican Journalists Weighs In...

The Narco...

and the Press

Banamex, Fox and the webs of neo-power

The Weaknesses of Hernández

By Carlos Ramírez

After having lost various court cases against the Yucatan newspaper Por Esto and against its editor Mario Menendez Rodriguez, the banker Roberto Hernandez filed suit in a New York court for opinions against him during a conference at Columbia University. The reason: Hernandez had an urgent need, before selling his bank, to separate himself from the doubts caused by the daily and by the Internet site about evidence of drugs found on his properties in Yucatan.

Citibank has the same problem: There are signs that the bank was used, by some of its top executives, for millionaire operations of money laundering that stemmed from corruption and even drug trafficking. The offices of Citibank in Mexico served Raul Salinas de Gortari in moving millions of dollars outside the country. And there are indications that the powerful narco-trafficker Amado Carrillo Fuentes - "The Lord of the Skies" - used Citibank to make money that came from the sale of illicit drugs legitimate.

The relation of Banamex with Citibank is not gratuitous. Citibank was the bank that ended up leading, in the 1980s, the severe foreign debt crisis. In spite of the Mexican threats to declare a moratorium, Citibank moved in the quicksand of Mexican politics and succeeded at making deals with the governments of De la Madrid and Salinas. Citibank formed a club of creditors to negotiate, as a bloc, with debtor nations, but always opposed the formation of a debtor's club. After fixing the economy with government money, used without permission of Congress, Zedillo sold Confia Bank to Citibank. And John Reed, president of Citicorp, has received the "Aztec Eagle" Medal for his role supporting Mexico on the issue of the debt.

The political history of Banamex also has its dark zones. Roberto Hernandez was a modest runner of stocks when he began to manage the black fortunes of Mexican politicians in the Stock Market and from there became a rich investor. In the government of Carlos Salinas, Hernandez wanted to bid for ownership of Telephones of Mexico, but the presidential decision already favored Carlos Slim, another beneficiary of power relations with Salinism. Pedro Aspe, treasury secretary, advised Hernandez to bid on Banamez and - oh, what a surprise! - he won it.

Born in Salinism, Hernandez was strengthened by Zedillism. Banamex was one of the banks rescued by FOBAPROA, in resulting from unregistered debts that have hung a millstone around the neck of public finance. At the same time, according to what the Democratic Revolution Party (PRD) revealed in the House of Representatives, there was, in the year 2000, a "fiscal pardon" for Banamex amounting to 12 billion pesos, obviously charged to the public budget.

The dark relations of Hernandez and Banamex have begun to be known. On Monday, January 15th, Indicador Politico published information, from the tax collector's office in Mexico City, that showed that the owner of the house on Agua Street where President Ernesto Zedillo and his family lived in the Pedregal neighborhood was in the name of Banamex. The Title Number is 354-738-35-000-2.

Hernandez turned from being a political player of Carlos Salinas to the campaign of Zedillo. And although Salinas was persecuted by Zedillo, Hernandez stayed very much in the past presidential term. On the eve of the elections of August 1994, Hernandez made a statement against (presidential candidate Cuauhtemoc) Cardenas and Diego Fernandez de Cevallos, and in favor of Zedillo: if the PRI loses, he said, there will be an exodus of capital, inflation, high interest rates, unemployment and a grave devaluation of the peso. The worst about Hernandez as banker and businessman is that his curses came true, not with the opposition, but with Zedillo and the PRI in the presidency of the Republic.

According to confirmed reports, Hernandez gave nearly three million dollars to the PRI political campaign of Zedillo, beyond his national and international lobbying in favor of the official candidate. Cardenas had threatened to review the files on the bank privatization by Salinas, in which that of Banamex was filled with dark regions.

But Hernandez became one of the principal bankers supporting the candidacy of Fox. And not only that: in his campaign, Fox used part of the infrastructure of Hernandez and Banamex. For example, the vacation house in Cancun and the offices on Paseo de la Reforma in the las Lomas neighborhood of Mexico City. And although he has his own career in the treasury department, the designation of Francisco Gil Diaz as treasury secretary didn't escape the webs of political power of two important businessmen: Gil was president of Avantel, the telephone company of Hernandez, and he came recommended by Aspe Armella, then linked to Alfonso Romo, another of the key businessmen in the power relations of Fox.

The sale of Banamex to Citicorp is made precisely in the middle of the process of the lawsuit in New York by the Mexican bank against two journalistic publications about the narco. The origin was the publication in the daily Por Esto of evidence that in the properties of Hernandez in the Peninsula, packages of drugs were found. The banker filed two legal complaints against Menendez and the daily Por Esto. And he lost them. The third is based on a conference given by Menendez and Al Giordano, United States journalist and editor of on the Internet for having insisted during a conference at Columbia University on speaking about the theme of drugs on the property of the banker.

The interesting thing was that the photographs and proofs offered by Por Esto about the drugs in the property of Hernandez concretely referred to the beaches in Quintana Roo of Punta Pajaros, frequented by Zedillo when he was president of the Republic and where Vicente Fox came to rest on July 8, 2000 after having won the presidency. Punta Pajaros is found in a zone known as "The Drug Peninsula."

The battle by Menendez and Giordano went all the way to the offices of The New York Times. Giordano denounced, on his Internet site, that Sam Dillon, correspondent for the New York daily, had been informed of the proofs of the drugs on the properties of Hernandez but did not publish the information. And the justifications were there: During his visit to the Yucatan, president Clinton was received on the properties of the banker Hernandez.

The matter jumped to the pages of The Village Voice, a prestigious progressive weekly in New York, where the analyst Cynthia Cotts broke the story in December 2000 that was heating up in the Court of the State of New York. In February of last year, Cotts published, in her column, that is very prestigious among those members of the media who ascribe to ethical behavior, a severe accusation: "In Mexico, untouchables are people protected by the power they wield. Two of these individuals are Sam Dillon and Roberto Hernandez."

Now, the matter has been brought to the level of lawyers, but the journalists and the banker Roberto Hernandez will be seated on the witness stand. However, the journalists have an advantage: Por Esto already won twice over the same accusation and has photos of the drugs found on the beaches of Hernandez. And the lawsuit against an Internet site doesn't know where to find jurisdiction. That's why Hernandez focused his attacks against the opinions of Menendez and Giordano in a North American university.

The litigation against Por Esto could clarify many things and even involve itself in the case of Governor Mario Villanueva, accused by Zedillo of being a narco and who escaped hours before the end of his term. The origin of Villanueva's conflict was not the narco, but his disputes with Hernandez over real estate and tourist zones in Quintana Roo. Hernandez has had all total protection from Zedillo.

Thus, two important banks stained by evidences of being dedicated to dirty work have decided to merge. But their histories remain in the memory of journalism.

The Memory of Journalism