Criminal Prosecutor Eduardo Taiano has agreed to push forward with a legal investigation that accuses Alejandro Vanoli, president of the Argentine Central Bank (BCRA), of public fraud.
BCRA President Alejandro Vanoli (Photo: Culture Ministry, via flickr)
Opposition legislators Federico Pinedo (PRO) and Mario Negri (UCR) presented the complaint, alleging that Vanoli and the Central Bank made future contracts at a peso to dollar conversion that is far less then the actual speculated rate. This cost Argentina an estimated $25bn, according to Pinedo’s calculations.
“This operation is causing a grave national loss for the BCRA because the bank is selling future dollars at a price of approximately US$10.65, when they could easily be selling at a value of US$14 or US$15, which is price indicated by the New York market for future exchanges,” Pinedo explained in the legal complaint.
Pinedo alleges that the Central Bank has already made future contracts valued at over $15bn, meaning that the BCRA has lost up to $25bn over the last few months because of the undervalued exchange conversion.
Vanoli responded by explaining that the future contracts were made to “provide certainty and avoid volatility in the foreign exchange,” saying the accusations were politically motivated by those seeking a strong devaluation.
The future value of the peso has become a major point of contention between the two presidential candidates in the weeks leading up to the election run off.
Vanoli went on to assert that the bank’s actions “run absolutely no risk, since any movement [in the peso-dollar conversion] would have neutral effects as it would equally affect assets and liabilities.”
In addition to the claim againt the Central Bank, Taiano will also seek to investigate companies that may have benefited from the alleged rate devaluations.
He claims that large multinational companies with subsidiaries in Argentina, financial institutions, institutional investors, and individuals with a high purchasing power of currencies may have reaped massive rewards from the bank’s alleged actions.
Federal judge Claudio Bonadio is in charge of the case and will determine whether the case should move forward. Bonadio is expected to begin calling for witness testimonies soon.
The post Central Bank Chief Under Investigation for Public Fraud appeared first on The Argentina Independent.