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Volume 17, Number 12
December 1, 2011
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news

Also in this section:
Finmeccanica scam unravels on Italian end, Martinelli and Varela accuse each other
Test case in El Bebedero: Martinelistas flout election laws in a by-election
Guatemalan archbishop's intervention doesn't sway Italian energy company
President puts on a water show at a plant that has never worked right
"Intermediary" skimmed Panama's Italian radar, helicopter mapping contracts
FARC, Bogota's mayor offer their country different visions
The president struts his stuff at the Bomberos' Torchlight Parade
Martinelli names his high court replacements for Cigarruista and Spadafora
UNDP/OAS report: Our Democracy in Latin America (a long PDF file)
Wendy Reaman's scenes from a rained-upon Thousand Pollera Parade in Las Tablas
Italy investigates suspect Panama deals
Former political prisoner says Martinelli personally participated in his torture
Italian photographer catches up with Lavitola in Panama
Martinelli's contrived women's dignity protest breaks up in confusion
Floods and landslides cut off the city of Colon
PRD activist, radio journalist slain in Penonome, government employee held

Many things that used to be in a Panama News Briefs feature of the website have now migrated to our constantly updated Facebook page


Argentine businessman and Valter Lavitola friend Gustavo Franchella.

Lavitola front company got $33 million cut of Italian contracts
by Eric Jackson

This is the operative statement. The others are inoperative.
Richard Nixon's spokesman Ron Ziegler

I see nothing! I know nothing!
Sergeant Schultz

I have no idea who this young woman is, and I don't know about the existence of this company.
Security Minister José Raúl Mulino

The Martinelli regime said that it didn't use the legally prescribed bidding procedures in its deals for radar installations, helicopters, patrol boats and digital mapping services with the disgraced former government of Italy because these were "government-to-government" contracts. But now the Italian press, based on prosecutorial sources, reports that there was a private intermediary that got 10 percent of the radar, helicopter and mapping contracts with subsidiaries of the Italian state-controlled Finmeccanica aerospace and defense conglomerate. The reports are that these contracts amounted to about $333 million --- more than previously thought --- and the Panamanian start-up company received some $33 million.

The company, Agafia Corp SA, was founded just a few days before Silvio Berlusconi's June 2010 visit to Panama. Officially, its president is a 23-year-old La Chorrera woman, Karen De Gracia Castro. But the registered officers of Panamanian corporations are often figureheads who have no ownership or management roles, and De Gracia appears to be one of these.

The purported owner of Agafia, according to Vice Minister of Security Alejandro Garúz and several other sources, is Gustavo Franchella, an Argentine of Italian extraction who once worked for the giant US-based multinational business consulting company AT Kearney, at its Madrid office as the international director of its Communications and High-Tech Practice department. But in 2006 he left that company and two years later formed White Haven Consulting, with offices in the Dominican Republic, the British Virgin Islands and Panama. In the Dominican Republic he reportedly was a consultant for a company called IBT in a bid to win four hospital construction contracts in Panama. Franchella made his way to Panama in 2009.

While he was still in Spain, Franchella made the acquaintaince of Valter Lavitola, the now fugitive bagman for Silvio Berlusconi. And De Gracia? Italian media identify her as a friend of Lavitola's, of more recent acquaintance than Franchella. Sources in the Italian courts are saying that they believe that Lavitola is Agafia's true owner. Panamanian banking and corporate secrecy laws make it hard to follow the money trail on this end, but apparently Italian justice has other sources and leads. Some of their information may have come from a series of raids on the offices of Lavitola's newspaper L'Avanti or from people who worked at Finmeccanica or its subsidiaries who have been called to testify in the investigation.

One Italian newspaper, II Fatto Quotidiano, alleged a family relationship between De Gracia and President Martinelli, with the latter issuing vehement denials about that but keeping his silence about the intermediary's cut of the purchases from Italy. Security Minister José Raúl Mulino, while also denying that he knows De Gracia, has refused all comment on the contracts with Italy, saying that these are national security secrets.

The gist of the scandal, from the Italian point of view, is that the contracts of Finmeccanica and its subsidiaries were inflated and money was skimmed in various ways and put into slush funds that went into payoffs for politicians in Italy and in the countries that bought Finmeccanica goods and services. Although he is noncommittal in his public statements, it appears that Italy's new Prime Minister Mario Monte is not going to intervene to protect Berlusconi, Lavitola, Finmeccanica executives or politicians whom they may have bribed. In the greater scheme of things, Italian relations with German Chancellor Angela Merkel --- whom Berlusconi insulted but who holds the power to rescue Italy's troubled economy or let it fail --- are more important to Italy than are Italian relations with Panama.


Karen De Gracia Castro





    

Also in this section:
Finmeccanica scam unravels on Italian end, Martinelli and Varela accuse each other
Test case in El Bebedero: Martinelistas flout election laws in a by-election
Guatemalan archbishop's intervention doesn't sway Italian energy company
President puts on a water show at a plant that has never worked right
"Intermediary" skimmed Panama's Italian radar, helicopter mapping contracts
FARC, Bogota's mayor offer their country different visions
The president struts his stuff at the Bomberos' Torchlight Parade
Martinelli names his high court replacements for Cigarruista and Spadafora
UNDP/OAS report: Our Democracy in Latin America (a long PDF file)
Wendy Reaman's scenes from a rained-upon Thousand Pollera Parade in Las Tablas
Italy investigates suspect Panama deals
Former political prisoner says Martinelli personally participated in his torture
Italian photographer catches up with Lavitola in Panama
Martinelli's contrived women's dignity protest breaks up in confusion
Floods and landslides cut off the city of Colon
PRD activist, radio journalist slain in Penonome, government employee held



© 2011 by Eric Jackson
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