The United States has seized a bank account located in Bermuda alleged to have been owned by former State of Coahuila, Mexico, Secretary of Finance Hector Javier Villareal Hernandez, United States Attorney Kenneth Magidson announced today.
The account, which is held in Bermuda at Sun Secured Advantage and N.T. Butterfield and Son Limited, contained $2,275,544.41 as of Jan. 4, 2013. The government alleged, as its basis for forfeiture, that the funds in the account were involved in a money laundering transaction, that the property constitutes or was derived from proceeds traceable to offenses including bribery of a public official, or the misappropriation, theft or embezzlement of public funds by or for the benefit of a public official…
According to the civil complaint, in 2011, Mexican law enforcement officials initiated an investigation involving fraudulent loans obtained from Mexican banks by Hernandez while he held the position of Secretary of Finance. The investigation includes three fraudulent loans from two different Mexican banks from July 2010 to March 2011 totaling more than $3 billion Mexican Pesos ($246 million U.S. dollars based on exchange rates on the dates of the loans). On Feb. 3 and March 8, 2012, Mexican government authorities filed false loan charges and issued arrest warrants for Hernandez’s involvement in the false loans with two Mexican banks. The charges allege Hernandez and other co-conspirators acquired loans by providing false information to Mexican banks. The false information involved the use of false registry stamps or previously approved registry stamps used on the false loan contracts.
The conspiracy is alleged in the complaint to have begun when Hernandez requested a loan on behalf of the State of Coahuila. He then drafted and submitted a false loan contract for approval by the federal Treasury Department. Hernandez conspired to falsify the approval of the submitted loan contract. His alleged co-conspirators, who worked at the federal Treasury Department, placed a fraudulent federal registry stamp or a previously approved registry stamp on the loan contract to make it appear that the loan contract had been approved. After the loan contract obtained the false registry stamp or previously approved registry stamp and received “approval,” the contract was submitted to a Mexican federal bank for issuance of a loan to the State of Coahuila. Once the loan proceeds were obtained, they were available for use by the State of Coahuila.
Hernandez had full authority over the disposition of the loan proceeds for the State of Coahuila. The Mexican bank providing the loan proceeds required the State of Coahuila to open a bank account at the specific bank. In order for the State of Coahuila to repay these loans, they requested money from the Mexican federal government. After the State of Coahuila received monies from the Mexican federal government, they did repay the loans to the Mexican banks.
Hernandez opened an offshore investment account in Bermuda during this time period. Since April 2009, it is estimated that Hernandez and his associates received more than $35 million through foreign exchange transactions and cross border wires and subsequently purchased numerous real properties in San Antonio, Brownsville and South Padre Island with the illegal proceeds.
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