McClatchy Newspapers
Wednesday 18 April 2007
Bogota, Colombia - Chiquita Brands International's recent admission that it paid off a Colombian group on the U.S. terrorist list has spotlighted a practice once hush-hush in Colombia, Washington's closest ally in Latin America.
Several other U.S.-based corporations, including Atlanta-based Coca-Cola and the Alabama-based coal company Drummond Co., face civil lawsuits alleging their Colombian operations worked with the same group to kill several trade unionists.
But the guilty plea by Chiquita, a company with a long and infamous history in Latin America, has focused attention on the payoffs that Colombian and foreign companies make to the illegal armed groups fighting the country's 40-year-old civil war, especially in remote areas where those groups hold sway.
"Funding a terrorist organization can never be treated as a cost of doing business," said U.S. Attorney Jeffrey A. Taylor, who headed the prosecution against Chiquita, on the day the Cincinnati-based company pleaded guilty to engaging in transactions with specially designated global terrorists.
Chiquita's admission came as Colombia faces a burgeoning scandal linking allies of President Alvaro Uribe to illegal right-wing paramilitaries. Uribe was once governor of the province where Chiquita made the payments, and strongly supported the legal militias involved in some of the payments.
Ripples from the Chiquita case and the scandal already have reached Washington. Concern on Capitol Hill about violence against trade unionists in Colombia could derail approval of a U.S. free trade agreement with Bogota. Congress is considering a Bush administration request for another $600 million in aid for Colombia's fight against drugs and the armed groups.
Colombia's business environment has never been easy. Leftist guerrillas and paramilitary groups known as the United Self-Defense Forces of Colombia, or AUC, regularly extort businesses, ranchers and local governments to help finance their wars. The leftist Revolutionary Armed Forces of Colombia, or FARC, has even issued public "decrees" that outline how much must be paid based on income.
"The truth is that this happens on a very broad scale," said Simon Strong, managing director and head of the Miami office of FTI Consulting, a political risk specialist. "In the end they (the companies) are between a rock and a hard place."
Both the AUC and FARC are on the U.S. government's list of terrorist organizations. U.S. officials said Chiquita was one of the first companies to plead guilty to transactions with a group on the list, and that the $25 million fine imposed on the company - even though Chiquita itself told the Department of Justice about the payments - underscored how seriously U.S. prosecutors take the violations.
In Colombia, Chiquita paid both left-wing and right-wing groups, according to the case files in federal court in the District of Columbia. The court documents do not specify how much money went to the leftist rebels, but say $1.7 million went to the AUC beginning in 1997, when its fighters were completing a brutal sweep through northwestern Antioquia province.
Chiquita's then-wholly owned subsidiary, Banadex, operated in the sweltering, banana-growing regions of Antioquia. Chiquita sold Banadex in 2004.
The paramilitaries, created in the 1980s to fight off guerrillas in rural areas where government security forces had little presence, executed suspected rebels and collaborators in the Antioquia sweep. The guerrillas also were blamed for massacres and killings.
In a 1997 report on the bloodshed in Antioquia, Amnesty International said there had been "hundreds of victims" and added, "the vast majority have been civilians pressured to support rival armed groups."
The man running the AUC, a loose confederation of paramilitary groups, at that time was Carlos Castano, the charismatic son of a farmer who was kidnapped and murdered by the FARC in the early 1980s.
Court documents filed in the Chiquita case stated that Castano met with the then-general manager of Banadex in 1997 and "sent an unspoken but clear message that failure to make payments could result in physical harm to Banadex personnel and property."
Castano told Banadex to channel payments through Convivir, then a legal militia promoted by Uribe and other Antioquia authorities to protect civilians from guerrillas. Some of the militias worked closely with the AUC.
"Chiquita recorded these payments in its corporate books and records as 'security payments,'" said one prosecution document. After Convivir was declared illegal in 2001, Banadex funneled the payments through employees who made cash payments to the AUC. Banadex even paid the extra taxes incurred by one employee.
"The Chiquita case simply demonstrated what we've been saying all along: that companies doing business in Colombia are necessarily in bed with the paramilitaries," said Terry Collingsworth, executive director of the Washington-based Labor Rights Fund.
As United Fruit and later United Brands, Chiquita has had controversial operations in Latin America for a century.
A 1928 strike at its Colombia operations was quelled by army troops who opened fire and killed as many as 1,000 protesters. It helped foment a 1954 coup against Guatemalan President Jacobo Arbenz. Earlier this decade, Human Rights Watch linked Chiquita with companies that used child labor in Ecuador.
Now it is only one of several U.S. companies facing troubles for its Colombia operations.
The Labor Rights Fund filed the lawsuits against Drummond and Coca-Cola under the U.S. Alien Tort Claims Act and the Torture Victim Protection Act, which allows victims to sue in U.S. courts for human rights violations committed anywhere in the world.
In 1996, paramilitary fighters entered a Coca-Cola bottling plant, Bebidas y Alimentos, in Antioquia owned by Key Biscayne, Fla., resident Richard Kirby and assassinated a union leader, Isidro Gil. The next day, they returned and told the workers to disband the union or die. By the afternoon there was no union, and several workers had fled.
The U.S. State Department reported in 2003 that about 4,000 union members had been slain in Colombia in the past 20 years. The International Labor Rights Fund, citing human-rights groups in Colombia, said 444 were slain from 2002 to 2005.
Gil was one of four union members in Coca-Cola bottling plants in Colombia whose killings are part of one lawsuit against three bottlers: Bebidas y Alimentos, Panamco and Panamerican Beverages, as well as Atlanta-based Coca-Cola. A judge in Miami dismissed the suit against the corporate giant, but the plaintiffs have appealed the dismissal.
An attorney for Coca-Cola in Atlanta would not comment. Robert M. Brochin, the Miami attorney for Panamco and Panamerican Beverages, said they were not involved in the union activists' killings.
"There is no proof that the bottlers were in any way involved in a conspiracy with the paramilitaries," said Brochin.
The attorney for Bebidas y Alimentos did not answer a telephone message left by The Miami Herald. Lawyers for Coca Cola and Drummond have denied the allegations. The Drummond case is scheduled to go to trial in Alabama in July.
Colombian authorities are pursuing their own investigations into Chiquita's protection payments, and have threatened to seek the extradition of Chiquita executives from the United States. The Colombian attorney general's office also is investigating the Drummond and Coca-Cola cases.
"I do not regard this as a relationship between a blackmailer and his victim," Attorney General Mario Iguaran told journalists. "What I can see is a criminal relationship."
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