In the mid-80s, Army officers set up an illegal financial firm that managed more than 1.5 billion pesos of the time. Its existence was discovered during the investigation into the murder of a restaurant entrepreneur.

The last thing Aurelio Sichel saw in the early hours of July 19, 1989, was the gate of his house. Three shots to the back of his neck erased his vision, and he was instantly lying on the ground, bathed in his own blood.

The murder of this restaurant entrepreneur, owner of the Rodizzio restaurant chain, triggered an investigation that would uncover an illegal financial firm known as "La Cutufa," which operated within the Army and handled—as was said at the time—the equivalent of US$ 4 million of the era, defrauding both civilians and military personnel.

It was 1984 when Army Captain Gastón Ramos Cid, using "a small amount of his own capital," decided to create a financing system dedicated to raising funds to invest in high-profit businesses. Later, Captain Patricio Castro also joined.

Ramos and Castro convinced their acquaintances, especially those in uniform, to invest money in this 'financial firm' that paid much higher interest rates than usual. Both Castro and Ramos backed the return of capital with checks from personal bank current accounts.

The funds obtained were handed over to a financial operator—who would later be identified as Jorge Larraín—to buy and sell stocks, thus obtaining significant profits. These were used on various occasions to acquire promissory notes of the Chilean foreign debt, which they subsequently sold to the Central Bank, again obtaining significant income.

Although the firm initially operated especially among those in uniform, over time it extended its operations to civilians, chosen especially from among the friends and relatives of the military. During the investigation into Sichel's crime, his partner at the Gelatería Pavarotti, Carlos Pesce, would declare that "...the one who told me about this financial firm was Aurelio Sichel, inviting me to participate in it when I was working privately at the Gelatería Sebastián.

This was in February 1985, and Aurelio indicated to me that the person receiving the money was Patricio Castro, and that is how, in February 1988, I handed over one million pesos to Patricio Castro...".

Later, Pesce would add that "...I know for a fact that Aurelio gave Patricio Castro money from the Sociedad Gelatería Pavarotti on two occasions, the last time being the 18th, the day before he passed away; this last amount was paid to the Gelatería, attributing it to rent and electricity expenses." The funds go on a trip However, it was in 1986 that, among others, Brigadiers Jaime Lucares Robledo, Jerónimo Pantoja Henríquez, and Enrique Cowell Mancilla; Colonel Sergio Silva Castro; and Commander Gerardo Paredes became investors.

By 1988, they were among the most important depositors of money. That year, problems began. The first setback was the abrupt disappearance of the firm's funds. According to Isabel Margarita Pizarro, Sichel's widow, "a man with the surname Larraín took them.

We cannot pronounce his name for now." Jorge Larraín—whose existence could never be proven—had allegedly taken nearly $300 million and supposedly traveled to Ecuador to invest them in the name of the organization.

But nothing more was ever heard of Larraín. Faced with this situation, Castro and Ramos began to recruit new 'investors' to generate the resources to pay the old ones. At that moment, Lucares, Cowell, and Silva took control of the entity, assuming the roles of liaisons, recruiters, and administrators.

As principal investors, they ordered Ramos and Castro to continue issuing checks from their personal accounts. However, the lack of funds reached a crisis. The documents issued by Ramos and Castro continued to be covered until the resources ran out, at which point they began to be protested by their holders.

One investor alone held seven documents from a personal BHIF account belonging to Ramos, for an amount of $53 million. As the matter was uncovered, a veritable avalanche of protested checks began to appear in the criminal courts.

At that moment, the investigation into Sichel's murder, through a judicial accounting expert report—carried out by Alejo Lira and Germán Cereceda—confirmed the existence of the informal financial firm and that one of the main individuals involved was Patricio Castro.

Meanwhile, the collections for the checks continued to arrive. By October 9, there were already protests for $150 million in Castro's accounts, already submitted for collection. Ramos was declared a defendant for a sum exceeding $100 million.

While Castro fled the country, Ramos turned himself in voluntarily and was detained in a military unit. In October 1990, Ramos Cid was prosecuted by the head of the Eleventh Criminal Court of Santiago, Magistrate Mónica Tagle Madrid, and charged as the alleged perpetrator of the fraudulent issuance of checks.

While the lawsuits against Ramos accumulated in case file 571273-3, his lawyer, Sergio Rodríguez Wallis, would declare that these proceedings had nothing to do with Sichel's murder. Faced with the detention of Ramos Cid, General (ret.) Augusto Pinochet ordered an internal investigation "due to the possibility that his actions may have harmed members of the institution." The summary within the Army would cause a great stir, especially because it hinted at possible high-level corruption that even involved probable mismanagement of fiscal funds.

General Gastón Abarzúa, at that time director of Army Intelligence (DINE), would even be implicated. However, the civil process that visiting minister Marcos Libedinsky closed only in August 1992 would prove that only eight retired officers were involved.

Using a computer program specially created for the investigation, after interrogating more than 400 people and examining 11,200 checks, Libedinsky would reach the conclusion that La Cutufa had come to "manage" 1.5 billion pesos, which at that time was equivalent to more than US$ 4 million.

The court estimated that the investors were not guilty, according to the General Banking Law. But those who had dedicated themselves to exercising actions corresponding to banking companies, that is, collecting or receiving money from the public, were.

In this way, retired captains Patricio Castro Muñoz, Gastón Ramos Cid, and Alejandro Garat; retired brigadiers Jaime Lucares Robledo, Jerónimo Pantoja Henríquez, and Enrique Cowell Mancilla; retired Colonel Sergio Silva Castro; and retired Commander Gerardo Paredes Paredes were charged.

General Abarzúa, although he confessed to being an investor in La Cutufa, was not convicted as he had not participated in the other activities. The destination of the money was never known, nor could the existence of Jorge Larraín be proven.

In fact, the closest thing found was a currency exchange house belonging to Guillermo Larraín, but it became clear that he was not the one mentioned in the proceedings. It was even thought that Larraín could eventually have been Sichel.

Thus, what had begun as a high-profile fraud case was reduced to a fraud among those in uniform that affected some civilians. Although it was assumed that Sichel's murder had occurred because he had announced the withdrawal of his funds from the financial firm, the investigation could not detect a material link between both crimes.

In fact, his participation as an investor was only mentioned by statements from those interrogated. It was about a year after the financial firm started that Castro made part of his businesses independent and, with funds provided by his father-in-law, partnered with Sichel in the Rodizzio restaurant in Apoquindo and the Pavarotti ice cream parlor.

But he did not abandon La Cutufa. The process could not, finally, prove that Castro and Ramos had operated at any time with fiscal funds.

Source: El Mercurio, April 6, 2002

Those convicted in the Army's 'Cutufa' case will serve prison sentences

The magistrate of the 12th Criminal Court of Santiago, Alejandro Rivera, decided to revoke their benefit of conditional remission of the sentence for failing to pay more than 123 million pesos to the plaintiffs in the case.

Only the days they spent in preventive detention during the process will be deducted. Although the criminal convictions applied to those responsible for the illegal financial firm "La Cutufa," which operated within the Army from the mid-80s, were considered quite meager at the time, four of the main managers of the fraud will have to serve the sentence with effective prison time.

This was decided by the head of the 12th Criminal Court of Santiago, Alejandro Rivera, who issued arrest warrants against retired Colonel Jaime Lucares, retired Captain Gastón Ramos Cid, and civilian Gerardo Paredes Paredes.

Meanwhile, retired Major Patricio Castro is already serving the sentence pronounced by Minister Hugo Dolmestch in 1994. The court's decision is due to the fact that these four convicted individuals failed to comply with one of the requirements through which they were able to access the conditional remission of the sentence imposed on them: the joint payment of more than 123 million pesos to eight plaintiffs in the case processed in early 1990.

The ringleaders of the multi-million dollar fraud, Castro and Ramos, were sentenced to three years in prison as authors of violations of the General Banking Law, while Lucares and Paredes—the only civilian involved—were sentenced to 300 days in prison as accomplices.

But along with that punishment, the justice system also determined that they must be jointly and severally liable (that is, one or all of them) for the payment of compensation to those affected by the fraud.

The amount, according to the last settlement calculated in 2003, exceeds 123 million pesos. Up to one year in prison With the decision of the 12th Criminal Court of Santiago and deducting the days they spent in preventive detention when the facts were being investigated, Ramos Cid will have to serve one year and 10 months in prison.

Meanwhile, in the cases of Lucares and Paredes, the days of imprisonment will be 298 and 291 days, respectively. Patricio Castro, for his part, was notified of the sentence during the first fortnight of June, after he was arrested by order of the 31st Criminal Court of the capital for his eventual participation in other scams similar to those he carried out in La Cutufa.

It should be remembered that in this case, retired Major Alejandro Garat and retired Colonels Sergio Silva and Enrique Cowell were also convicted, who were not sanctioned with the payment of compensation to those affected.

Source: elmostrador.cl, September 12, 2005

Huber Case: Provis insists on innocence and links homicide to La Cutufa

Before the Second Criminal Chamber of the Supreme Court, the defense of the retired brigadier will argue that there are no concrete elements to involve him in the events that triggered the death of Gerardo Huber, and that the Army's loyalties were disrupted by the discovery of this illegal financial firm.

The Second Chamber of the Supreme Court, specialized in criminal matters, advanced this Monday in the review of the only appeal filed by the first defendants in the judicial investigation into the death of Colonel Gerardo Huber Olivares, whose crime was allegedly perpetrated to prevent investigations regarding the illegal arms trafficking to Croatia, detected in 1991.

This is the amparo (habeas corpus) filed by the lawyers of retired Brigadier Manuel Provis—Cristián Letelier and Héctor Musso—who will attempt to dismantle the arguments of visiting minister Claudio Pavez, who prosecuted the former military officer and five other former officers of this branch for the crime of illicit association, an eventual criminal organization that allegedly operated to carry out arms trafficking activities and hide the fact through the murder of the ill-fated officer.

Provis, former head of the Intelligence Battalion (BIE), is charged along with retired Generals Eugenio Covarrubias (former director of DINE), Víctor Lizárraga (coordination secretary of DINE), Carlos Krumm (former director of Logistics), and retired Colonel Julio Muñoz (alleged friend of the victim), who are accused of having carried out various maneuvers so that this crime would appear as a suicide in the eyes of public opinion and the justice system.

However, suspicions point to the motive being to avoid progress in the judicial investigation into the smuggling of 11 tons of equipment that were sold to Croatia, a country in a state of war and under a UN prohibition to acquire weaponry.

On this Monday, the highest court only managed to hear the report of the case, so the arguments will only begin tomorrow, Tuesday. Suspicions The then head of the BIE, the operational arm of DINE, is specifically accused of having seconded a series of suspicious actions, since neither he nor Lizárraga—his superior—have given sufficient or rational explanations about the manner, timing, and conditions in which they became aware of the colonel's disappearance.

However, both appear acting at the scene of the event—El Toyo bridge, in Cajón del Maipo—first thing in the morning the day after the disappearance (January 30). The magistrate notes that the DINE coordination secretary had not yet officially assumed that position, but was acting as head.

Furthermore, it is strange that the BIE reaction groups arrived around 04:30 hours at the place, while Huber's car was found only at 03:00 hours and the report filed with the Carabineros an hour later.

It is established in the summary that neither the uniformed police, nor the Military head of the metropolitan area, nor the relatives of the disappeared communicated with them. Likewise, Judge Pavez maintains that although Provis was on vacation from February 3 to March 6, 1992, he continued to intervene in the situation to join Lizárraga on a trip to Linares.

The magistrate has established that the objective of that journey had the sole purpose of seizing the colonel's youngest son, who remained missing and, presumably, kidnapped in a secret facility of the Army Intelligence School (EIE).

The version that the retired brigadier has maintained is that he was called to join the mission of finding a psychic who would help them find the whereabouts of Colonel Huber, which his defense has reiterated, pointing out that it is more common than it seems for teams dedicated to investigating to turn to this type of person to find clues about a disappeared person. "They did not carry out, in the city of Linares, nor in any other place, efforts of this type and, on the other hand, the possible intervention of the aforementioned psychic refers to another place," states the document written by Pavez. The other fact that incriminates Manuel Provis is the intervention of members of the BIE at the scene of the event, who cordoned off the sector and blocked the entry of the Investigative Police—in charge of the court's inquiries—in addition to altering the conditions by even transporting the deceased military officer's body by helicopter. Those actions were not ordered by the military prosecutor in charge of the case, Humberto Julio, as he has declared. Meanwhile, sources close to the investigation report that, following the indictments issued by Pavez, the officers who have provided statements have begun to cooperate to try to reconstruct the true circumstances that determined the colonel's death. Therefore, they project that the investigation has entered the home stretch to establish both the material executors and those who decided to eliminate Huber. La Cutufa The main argument that retired Brigadier Provis has expressed about how the events occurred refers to the fact that he only complied with the mission of traveling to Linares because it was an order from a superior, but that he can now interpret it as a distracting maneuver to divert his attention from the real events. To that extent, sources from his defense explain that he had been "bypassed" in all the operations carried out by the troops under his command at the moment the military officer's corpse appeared. That "alteration" in the Army's hierarchies would be explained by the judicial phenomenon that the Cutufa case generated within the military ranks. As it was said, the growing distrust that originated among the military, following the murder of the restaurant entrepreneur and one of the main investors of the illegal financial firm, Silvio Aurelio Sichel, on July 19, 1989, would have influenced the change in loyalties within the Army officer corps. Sichel was killed outside his plot, located in the Casas Viejas sector, after he decided to withdraw from the business or "system," as La Cutufa was christened. However, the judicial process regarding his death was dismissed without determining responsibilities. At the time, the then Court of Appeals of Pedro Aguirre Cerda issued an indictment against retired Captain Patricio Castro for his alleged participation in the crime, but the ruling was rendered ineffective some time later. La Cutufa was uncovered after a series of lawsuits for fraudulent issuance of checks were filed in civil courts. The documents bore the signature of Castro and active-duty Captain Gastón Ramos, whose last two assignments had been the DINE and the Non-Commissioned Officers School. On November 10, 1990, the arrest of retired Captain Castro took place in Paraguay, who tried to evade justice but was located in time by the Investigative Police. On July 8, 1992, the visiting minister of the case, Marcos Libedinsky, closed the summary and charged Patricio Castro, Gastón Ramos, Alejandro Garat, Enrique Cowel, Sergio Silva, and Jerónimo Pantoja. However, doubts still persist about those truly involved in this illegal financial firm, since it is speculated that it would be impossible for a hidden activity that involved nearly 250 Army officers, and even businessmen, to operate from the end of 1986 to mid-1989 without the Army's high command finding out, as many of them were investors. Provis's defense has also slipped in its client's suspicions that the materialization of the crime would fall on the same hitmen who perpetrated Sichel's murder. In that case, doubts fall on former agents of the then-dissolved CNI, such as Juan Carlos Solimano, retired Captain Arturo Sanhueza Ross, and Francisco Zúñiga Acevedo. However, the latter committed suicide under suspicious circumstances inside his car at the end of 1991, so it is impossible that he was involved in Huber's death.

Source: elmostrador.cl, March 27, 2006

Case File No. 1335-201: Qualified Homicide committed against the person of José Daniel Murga Medina

43.-- Police Report No. 5947, appearing on page 478 and following, carried out by the Investigative Brigade of Crimes against Human Rights of the Investigative Police of Chile, which had the purpose of identifying and interviewing former CNI agents regarding the facts that gave rise to this case, reporting that Roberto Antonio Farías Santelices, nicknamed "El Petete," is alive; while José Ramón Meneses Arcauz, nicknamed "El Shogún," Héctor Juan Jaque Riffo, nicknamed "El Anteojitos," and Alejandro Fernando Garat Gálvez, nicknamed "El Turco," are deceased;

Source: November 16, 2018