Seguros Sucre executive and associates admit to influence peddling, bribery of a public official and conspiracy to launder money

Published on September 23, 2020

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It was reported last week that Juan Ribas Domenech (a one-time adviser to former Ecuadorian President Rafael Correa),the former Chairman of the Board of Director of Seguros Sucre, changed his plea to guilty, in the money laundering and bribery scheme he has been charged in.

In yet another case that puts a spotlight on how much corruption was endemic in the Correa administration, some question why only weeks before he was set to go on trial, Ribas decided to accept a guilty plea after insisting for months that he was innocent.

Was it because two of his former co-conspirators have taken pleas agreements in exchange for detailing the entire scheme? Or was it because this trial was only focused on one of 34 companies that were awarded contracts under Ribas’s term, and he knows details of more bribery schemes will come to light? Or was it because he has agreed himself to lay out how deep the corruption went and who else may have been involved?

Perhaps a photo of him entertaining former president Correa in his home that surfaced a few months ago had something to do with it. But this is all speculation and what the real truth is behind all of this will have to wait until the US, where the bribery and money laundering trial is playing out, decides to release the details. Or until the US (or Ecuador) launches further investigations into the relationships between Ribas and other politicians and businessmen.

Like the Odebrecht bribery case, and the 2012-2016 Bribery Case that we wrote about last week, this bribery and money laundering case started years ago, early in Correa’s last term and continued throughout the end of his time as the elected leader of Ecuador.

And perhaps that is the best place to start in trying to unravel this unbelievable case of arrogance, criminality and blatant misuse of power.

From a small business to a booming company

What Ribas has pleaded guilty to is taking bribes to secure “reinsurance” contracts for two companies that sought to keep their business with the one-time almost exclusive provider of insurance for all of Ecuador’s assets.

The US case(which was filed in the United States District Court, Southern District Florida on February 12, 2020) came about originally as a money laundering case that was under investigation by the US Internal Revenue Service. Once the extent of the criminality was discovered, the US also brought charges against Ribas and his co-conspirators for bribery under the US Foreign Corrupt Practices Act (FCPA). Ecuador is silent on when, or if, it will also bring charges against those involved in the scheme.

One thing that government investigators would have to determine would be just how far back the corruption went. But how it started is clear: the story begins in the government of formerPresident Correa, when in 2009 he ordered public sector entities to contract their insurance policies solely with Seguros Sucre, an Ecuadorian state-owned insurer.

After that, Seguros Sucre went from having a share of just 3.7% in the local market in 2008 to holding 18% in 2018.

“This monopoly served to monopolize privileges with the public companies of Ecuador and also to celebrate irregular contracts,” says Zobeida Aragundi, a member of the National Anticorruption Commission (CNA) in Guayas.

And so, began the opportunity for corruption to enter the picture. But keep in mind, the US case against Ribas only brought charges for the bribery scheme that happened with JLT de Colombia Corredores Colombianos de Reaseguros SA, a reinsurer subsidiary of the British JLT Specialty Ltd.. Seguros Sucre did business with an average of 34 Ecuadorian and international reinsurers between 2013 and 2018.

The scheme

The actual scheme that Ribas and his co-conspirators—Colombian Felipe Moncaleano Botero (an intermediary for JLT Re), Ecuadorian José Vicente Gómez Avilés (an intermediary who participated in the bribery scheme), a yet unnamed financial advisor who has collaborated in the investigation and Ecuadorian-American Roberto Heinert Musello (who was a partner of Gómez)—is on the surface quite clear, but the machinations they used to commit the crime became quite convoluted.

Investigators say the multi-million-dollar bribery scheme allegedly operated in Seguros Sucre between 2013 and 2017.

According to the US, and the Ribas confession, here is how the conspiracy worked.

The players

First and foremost, it’s important to understand that Seguros Sucre is a state-owned insurance company of Ecuadorand is an “instrumentality” of the Ecuadorian government. Because of that, the US was able to file charges under the FCPA.

Next, Ribas was the Chairman of the Bord of Directors of Seguros Sucre during the time that the current bribery scheme was in place. He was also an advisor to former president Correa during this time. Because of this, he was a “foreign official” of the government of Ecuador, and again, could be tried under the FCPA. He took over as the head of Seguros Sucre in September 2013 (ironically, as a result of complaints of irregularities made by the Anticorruption Secretariat).

His co-conspirator, the Colombian Moncaleano, was an executive and shareholder, of JLT’s Colombian-based subsidiary. Fellow co-conspirators Gómez and Heinert owned a Panamanian company that was used to launder the funds that went to Ribas. Because they were both US residents, they were able to be charged as “domestic concern(s)” under the FCPA.

Gómez and Heinert’s Panamanian company was a “reinsurance introducer,” meaning they helped companies obtain and/or retain contracts with Seguros Sucre, in exchange for a commission.

They also owned another Panamanian company which held a brokerage account with a bank in Switzerland, that would be used to funnel funds to Ribas. Gómez controlled this company and could direct payments into and out of the account.

In all of this, there was also another company formed in the Cayman Islands (called Intermediary Company 2 in the US filing) that held at least three US bank accounts that were used to facilitate transfers between the co-conspirator’s accounts.

Finally, there was also a company formed in Panama, that held a brokerage account controlled by Ribas. This account received and held the bribe payments from Moncaleano and Gómez to Ribas.

One other person played a role in this, and that was a “financial advisor” who has cooperated with US authorities and whose name has not been made public yet. This person holds dual Ecuadorian and US citizenship and is a relative of Gómez. This person initiated the transfers in and out of the Swiss accounts of Ribas, Gómez and Moncaleano, and therefore was also labeled as a “domestic concern” un the FCPA.

The bribes

As we said above, Ribas was the Chairman of the Bord of Directors of Seguros Sucre, and in that position had authority over all the reinsurance contracts that Seguros committed to. He used that position to solicit bribes from Gómez and Moncaleano, in exchange for helping Gómez obtain and retain business for JLT with Seguros Sucre (in violation of the FCPA and Ecuador’s 1aw against bribery of a public official).

In order to conceal and disguise the bribe payments, Ribas, Gómez and Moncaleano, along with others, laundered at least $1 million thru US bank accounts belonging to Ribas in violation of US money laundering laws (hence, the case being brought by the US and not Ecuador).

According to court documents, the first instance where this scheme appears to have come into play was in late 2013 (just after Ribas took over control of Seguros Sucre). In early 2103, JLT has been awarded the contract as insurance broker for Ecuador’s Ministry of Defense (MOD). However, in late 2013, Seguros Sucre notified JLT that it would not have its contract renewed in 2014.

Then, in early 2014, Moncaleano approached the owners of JLT and Gómez, about “helping” them retain their contract. Moncaleano and Heinert then held meetings with Ribas. Thereafter, Seguros agreed to renew JLT’s contract as the insurance broker of the MOD.

Following this, in May of 2104, JLT approved the payment of all future “commissions” to be deposited into Gómez and Heinert’s Panamanian bank account.

Then in, September 2014, JLT agreed to pay Gómez and Heinert’s company $1.8 million in “commissions,” for the 2013 to 2014 MOD contract, and to further pay 8% commission on a future 2104 to 2105 MOD contract.

However, these “commission” payments weren’t made to Gómez and Heinert’s company account. They were instead—at Gómez’s request and Moncaleano approval—deposited into accounts in the US and Switzerland as well as other Panamanian accounts owned by the pair.

Specifically, from October 2, 2014 thru October 28, 2016, Gómez and Heinert’s Colombian subsidiary of JLT sent payments totaling at least $6.5 million (in 11 or more wire transfers) to their Swiss account. [In February 2015, Gómez and Moncaleano created a false, backdated contract between the two companies, signed by Moncaleano, which they sent to Gómez and Heinert’s Swiss bank to justify the payments.]

A portion of these commission payments were then funneled to Ribas and several of his family members. At least $682,00 in cash and $1,975,000 in securities were sent directly to his Swiss brokerage account. The transfer into Ribas’s Swiss account came thru the company that was set up in the Cayman Islands, to US bank accounts. The US transfers that accounted for approximately $1 million were deposited in Ribas’s US bank account (approximately $750,000) and the accounts of several of his relatives ($254,000).

On or about November 3, 2014, Gómez also transferred another $400,000 from he and Heinert’s Swiss account to Ribas’s Swiss account. Then on December 8, 2014, he transferred $319,777 to the Cayman Islands account; $300,000 of this was transferred on December 18, 2014, into Ribas’s US bank account.

More activity happened on December 12, 2014, when the “financial advisor” (at Gómez’s December 9, 2014, email request) transferred $310,158 from Gómez and Heinert’s Panamanian account to the the Cayman Island account.  Then on January 15, 2015, the financial advisor wired $282,000 of the $310,158 to Ribas’s Swiss account.

The next series of transfer began on June 8, 2015, when the financial advisor transferred $106,706 from Ribas’s Swiss account back to the Cayman Island account through the purchase of securities. The financial advisor then wired $100,000 of the $106,706 from the Cayman account to Ribas’s to his US bank account.

Between March 31, 2016, and April 11, 2016, the financial advisor wired three transfers ($29,000, $65,000 and $10,000) from the Cayman Islands account to US accounts held by three of Ribas’s relative; these transfers totaled $104,000.

Then on May 12, 2016, $104,000 in securities was taken out of Ribas’s Swiss account and sent back to the Cayman Islands account.

While all of this was happening, emails were exchanged between Moncaleano, Gómez and Heinert regarding “repayment” of $200,000 to Moncaleano for the $200,000 he “loaned” to another Seguros Sucre executive (later identified as former manager of Seguros Sucre, José Luis Romo-Rosales Castillo).

After all of this activity on the MOD contract ended, Moncaleano contacted Gómez and Heinert on August 8, 2016 in reference to $80,000 that he had transferred from his personal account for “Termopichincha,” believed to be in reference to CELEC EP Termopichincha, a business unit of Ecuador’s public electric company and one of its entities that JLT received reinsurance business from Seguros Sucre.

In an email chain, Moncaleano said (translated from Spanish), “We need to find a way for me to get back this $80,000 plus the $200,000 that I transferred last year in order to transfer an adjustment to Juan (assumed to be Juan Ribas Domenech).”

Based on all of this “activity,” the US brought forth charges against all of the players for influence peddling, bribery of a public official (under both US and Ecuadorian law), and conspiracy to launder money.

So how did they get caught?

The case brought by US authorities started out in its Internal Revenue System (IRS) as a money laundering case; what triggered the investigation has not been disclosed by any of the participants or the IRS itself.

But what is known at this time is that the “financial Advisor” who was in the middle of the transfers among the different US, Panamanian, Swiss and Cayman Islands accounts has agreed to cooperate with the authorities in the US to provide information on the case in exchange for a reduced sentence. From that, one can assume that the IRS’s may have begun its money laundering investigation with this person.

Once the baseline information was provided so that the US could build its case, the rest of the people involved were sequentially detained and once presented with the scope of the investigation agreed to plead guilty, and provide further details on the case, assumedly in exchange for a reduced sentence.

Romo-Rosales arrested

On the night of May 20, 2020, the former Manager of Seguros Sucre, José Luis Romo-Rosales was arrested in connection with the corruption case against Ribas. This was done in coordination with the Attorney General’s Office and the United States Department of Justice.

Police detained both Romo-Rosales and his wife, Verónica Haro.

Romo-Rosales was the Manager of Seguro Sucre when Ribas was Chairman of the Board of Directors.

According to the Prosecutor’s Office, the raids were made at the homes of two former directors of Seguros Sucre (the other belonging to Juan Ribas Domenech).

After leaving the state insurance company, Ribas Domenech recommended José Luis Romo Rosales to the managerial position in 2016, who would have been in charge of giving a legal appearance to the money obtained from the collection of bribes.

The Prosecutor’s office is investigating Romo-Rosales for money laundering, claiming that he has at least $450,000 in assets that could not be justified.

It is believed that Romo-Rosales is the “second Seguros Sucre executive” referred to in email exchanges between Moncaleano and Gómez.

Since his arrest in May 2020, Romo-Rosales has been held for trial. There have been no updates on his situation since mid-September 2019.

Both Gómez and Moncaleano plead guilty

Shortly after the arrest of Romo-Rosales, both Colombian Felipe Moncaleano Botero, Ecuadorian José Vicente Gómez Avilés pleaded guilty to their role in the bribery and money-laundering conspiracy formed with Juan Ribas Domenech to obtain and retain contracts with Seguros Sucre.

Gómez’s confession confirmed what Moncaleano offered up in his confession.

“Specifically, between 2014 and 2017, the defendant and Heinert received approximately $10.8 million in payment of commissions from the insurance broker [JLT Re Compombia]. The documents signed by Gómez and Moncaleano revealed details about the payments and the route that a portion of the $10.8 million followed. They said that at least $6.5 million was transferred to several Swiss accounts from a company owned by Gómez and Heinert, and of that amount, $3.1 million went to the United States to accounts of Ribas and his relatives.”

This total, as confessed by Gómez, includes a refund that Gómez and Heinert paid to Moncaleano, for $200,000, which actually corresponded to a bribe that Moncaleano had paid directly to the second official of Seguros Sucre.

Since February, Gómez has remained free on a bond of $250,000.

“The defendant makes this declaration voluntarily and freely and because in reality he is guilty of the crime that is imputed to him,” ends the document signed by Gómez, his lawyer and the US prosecutors

In the confession, it is made clear that it “does not include all the facts known to the accused, related to the illegal activity in which he was involved along with other people.”

Ribas admits guilt

Faced with an overwhelming amount of evidence against him, on September 16, 2020, Juan Ribas Domenech changed his plea to guilty to laundering money from bribes from two reinsurance companies for “more than two million dollars” between 2013 and 2017.

“The defendant and his accomplices agreed that he would receive bribes in exchange for allowing Moncaleano to win and maintain business with Seguros Sucre,” says the confession signed by Ribas and his lawyer.

Heinert still to be tried

The other defendant in this case is the Ecuadorian-American Roberto Heinert Musello, who was a partner of Gómez Avilés.

In a Miami court last February, US prosecutors presented an accusation against Roberto Heinert for participating in the bribery scheme and laundering money in that country. Heinert has not plead guilty to any charges. But the court says there is a clear trail of evidence to prove his guilt in the charges.

What’s next

This case has revealed only a small part of the insurance business that was handled during the Rafael Correa government, the office from where public sector insurance was handled was in Carondelet in the office of the then Secretary of the Administration, Vinicio Alvarado (now a fugitive), said former Assemblyman Galo Lara, who made complaints about Seguros Sucre as far back as 2012.

“The US will only investigate money laundering in that country, if the Ecuadorian Prosecutor’s Office does not open an investigation and request criminal assistance from other countries, we will never know what happened to the rest of the money,” he said.

Due to the confessions of Ribas, Gómez and Moncaleano, the information on the case has been expanded. The prosecutors pointed out that another reinsurer also paid bribes, that other people intervened as those who made the contact and that a second official from Seguros Sucre also received bribes.

The complaint in the United States explains that Ribas Domenech, Gómez Avilés and Moncaleano are part of a broader network of illicit operations. They would be accomplices, along with other people, in money laundering activities.

1 Comment

  1. Plaudits on this investigative journalism.

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