A court ruling has allowed Elba Esther Gordillo to walk free of money laundering charges , which exposed serious flaws in other high-profile corruption trials, officials and experts say, and underscored the challenges the incoming government will face.
Last week, former teachers' union leader, Elba Esther Gordillo , was freed from prison when a j udge dismissed money laundering charges , she was accused of laundering ove r MXN $100 million in union funds to pay for luxury goods and plastic surgery.
Judge Miguel Angel Aguilar
, the judge that freed her , justified his decision by using a November 2017 Supreme Court ruling that stated that prosecutors must first obtain court orders before requesting financial records , according to non-public court documents.
The same argument could be used in other prominent investigations, such as those into former governors accused of embezzling public funds, a half-dozen government sources and legal experts said.
Mexico
is flooded with billions of dollars in illicit proceeds from drug trafficking, organized crime and theft of public money, but despite efforts to improve anti-money laundering laws , the country is failing to mount successful prosecutions.
Financial information has been obtained without court orders in thousands of cases underway or already resolved, said Jorge Lara, a former deputy attorney general.
Since Mexican law allows for jurisprudence that is favorable to defendants to be applied retroactively , many of those cases could be thrown out , he said. “This is a really potent tool to topple cases,” Lara said.
Public anger over corruption
was a major factor in propelling leftist Andrés Manuel López Obrador to the presidency in the July 1 election. The Gordillo ruling shows that López Obrador will face a difficult task when he tries to fulfill his pledge of ending corruption.
Other prominent cases, like Javier Duarte's, the former Veracruz governor, was accused of using fake companies to launder millions and has become a symbol of corruption under Peña Nieto's government.
Duarte
, who denies wrongdoing, has been in prison since last year . His case is among those that could collapse due to the November Supreme Court ruling , according to two government sources.
A WEAK FOUNDATION
In Gordillo’s case , Aguilar ruled that authorities did not have a court order before seeking private banking information in 2013 when she was arrested. Therefore, the records were obtained illegally.
That applied the November Supreme Court decision, which was meant to be a check against abuses by prosecutors, said Angelica Ortiz, a former top official at Mexico’s financial intelligence unit, the Finance Ministry’s anti-money laundering arm.
Gordillo’s case
also shows how prosecutors are struggling with a new U.S.-style system of oral trials that gives defense lawyers more leeway to dismiss charges for procedural errors, said Carlos Pérez, a lawyer and laundering expert.
“We are still not 100% ready for trials,” Pérez said. “This is going to lead to not just letting the governors ou t, but also other types of criminals whose cases are underway.”
The new model is replacing an opaque inquisitorial system , and has put prosecutors on the back foot in the courtroom , said Javier López, who runs the Anti-money Laundering Committee at the Mexican Institute for Public Accountants.
Speaking of the prosecutions of ex-governors , he said that “the cases are not being put together properly. ”
gm