Powerful Honduran family charged with laundering drug money by U.S. (Oct. 8, 2015)

Three members of a powerful Honduran family -- including former vice president Jaime Rolando Rosenthal, one of the country's wealthiest men -- were indicted in the U.S. yesterday, charged with laundering money. Also charged was his son, Yani Rosenthal, a former cabinet minister, and his nephew Yankel Rosenthal, a soccer club manager and former minister of investment who was arrested Tuesday evening in Miami.

They are accused of laundering money for some of the largest Central American drug syndicates through accounts in the United States, according to the Treasury Department, which also announced sanctions against the three family members.

In a statement yesterday the U.S. Justice Department said the three, as well as seven businesses were labeled "specially designated narcotics traffickers" under the Kingpin Act, reports the Associated Press. The men "provide money laundering and other services that support the international narcotics trafficking activities of multiple Central American drug traffickers and their criminal organizations," the statement said.

All three Rosenthals were named "Specially Designated Narcotics Traffickers," and added the family bank, meat packing plant and investment arm, among other businesses, to its "Specially Designated Nationals" (SDN) list, which prohibits others from doing business with these companies or face sanctions, reports InSight Crime.

Jaime and Yani Rosenthal released a statement yesterday denying the accusations against them. "We have never been involved in illegal acts, much less in drug trafficking or money laundering activities." They are apparently still free in Honduras, but U.S. authorities arrested Yankel Rosenthal in Miami on Tuesday.

A senior U.S Treasury Department official, quoted in the AP said that it was the first time the Kingpin Act had been used against a foreign bank. He called it "one of the most significant money laundering networks in Central America."

The charges come as a shock in Honduras, where such powerful figures are generally granted impunity, reports the New York Times. The piece quotes Steven Dudley, co-director of InSight Crime, who says it might be a warning from U.S. officials to the small elite that controls most of the country. "This is a shot across all the elite’s bows in Honduras," he said.

Four months ago, InSight Crime actually interviewed Jaime Rosenthal and his daughter, asking them why they did extensive business with the Chachiros, formerly one of the region's most powerful drug trafficking clans. "The answer, it turns out, is pretty simple: it was good business." 

The interview is pretty gripping, especially in light of this week's developments. "Rumors have swirled for years about the Rosenthals’ relationship with the Rivera Maradiaga (los Chachiros) family, but nothing has ever been written about it, until now. ... Despite their years of doing business together, the Rosenthals say they did not know the Rivera Maradiaga family was involved in drug trafficking and other nefarious activities until the US Treasury declared them targets in September 2013."

The NYTimes piece notes that the move comes as corruption is a headline issue in Honduras. Specifically reports about $350 million looted from the country's health and social security institute, parts of which were funneled into the election campaign of President Juan Orlando Hernández.

Yesterday the Miami Herald reported that corruption in Honduras -- rather despair caused by the entrenched and unpunished scandals -- is fueling immigration to the United States, joining more traditional causes like poverty and insecurity.

Calls for an international independent group to help root out corruption, like the U.N. backed International Commission against Impunity in Guatemala (CICIG) this year panned out into a less ambitious assistance from the Organization of American States to assist Honduran officials. The NYTimes quotes the Wilson Center's Eric Olsen who says the initiative might not be enough. "The internationals will supervise and advise the attorney general in Honduras, but that could mean just about anything and doesn't give them the solid legal ground to take on politically charged cases," he said.

News Briefs

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