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Government declassifies documents in Coopera banking failure; 400 Cuenca expats were among 113,000 affected by the 2013 collapse

Following the release of thousands of documents from the collapse of the Cuenca-based financial cooperative Coopera, Ecuador’s anti-corruption czar Iván Granda said that government officials are to blame for poor oversight as well as a subsequent cover-up.

Ivan Ganda displays the order to declassify Coopera documents.

The 2013 Coopera failure left 113,000 account holders locked out of $48 million in savings, including an estimated 400 Cuenca expats. Although the vast majority were eventually reimbursed, some large investors may never reclaim all their money, their losses estimated at as much as $15 million.

Granda questioned why the government of former president Rafael Correa sealed the files from the Coopera investigation, saying he believed it was because of poor monitoring by the Ministry of Economic and Social Inclusion (MIES) and the Superintendencia of Popular Economic Solidarity (SEPS). In particular, he said former MIES director and current Azuay National Assemblywoman Doris Soliz and former SEPS director Patricio Rivera may be investigated for their role in the debacle.

In addition, Granda questioned the government’s failure to vigorously pursue three Coopera officials who fled the country following the collapse. He said Claudio Alvarado, Luis Carmona and Marcelo Vega Gasparutti, all wanted for bank fraud, will immediately be put on Ecuador’s “Most Wanted list.” The three are believed to be living in the Miami, Florida area.

Coopera members gather outside a branch office in Cuenca following the 2013 collapse.

Granda says that the declassified documents provide details of how Coopera laundered money through banks in Venezuela, Panama, Hong Kong, Switzerland, Argentina, Colombia and the U.S., building a “pyramid scheme” operation that fell apart when on-hand funds could not cover expenses and customer withdrawals.

Most movement of money to overseas banks was conducted through “ghost companies” created by cooperative officials, Granda said.

Coopera customers were attracted by interest rates as high as 14 percent and by the cooperative’s promise to assist poor farmers and businesses in southern Ecuador. Coopera officials held a number of seminars from 2011 through 2013 to attract expat investment, emphasizing their efforts to improve the lives of the poor. “In the end, it was all a scam,” Granda says. “The government should have recognized what was happening much sooner and stepped in to stop it.”

Most Coopera account holders were from Cuenca and Guayaquil.

Coopera general manager Rodrigo Aucay was tried and convicted following the collapse. According to documents released Wednesday, he was a friend and supporter of Correa, which Granda says could have been a factor in government inaction and the classification of documents.

For more about the Coopera case click here, and here.

29 thoughts on “Government declassifies documents in Coopera banking failure; 400 Cuenca expats were among 113,000 affected by the 2013 collapse

  1. Just before it fell apart, they were offering interest as high as 14.75%. Too good to be true but a lot of gringos got greedy.

      1. If it wasn’t greed it was an unbelievable amount of naivete. Call it what you want. I know of several gringos who had their money in Coopera who also invested in Richard Verkley’s gold mine and I don’t believe they got any of their money back. As I say, call it what you want but you can’t call it using common sense.

        1. I’d like to see a story about the Richard Verkley gold scam. Last I heard, he had fled to Spain where’s he’s orchestrating new scams. Buyer beware!!

              1. Absolute baloney. When HOG was run by the Verkley’s it was crooked and it was so proven publicly. All you had to do was look at their books, which they made public and if you knew anything about accounting you could see they were cooked.

                  1. Nice deflection, Robert. First of all, I’m not abel. I mock him with every post.

                    Second, your vapid reply is nothing but deflection. Ray of sunshine? Is that all you want or would you like to hear the truth once in a while? Can you dispute a single word of what I have written?

    1. Victim-blaming is painful for the victim so I do not agree with making the victim the bad guy. They have lost and do not need salt rubbed in the wound. Anytime someone questions what a victim could have done differently to prevent a crime is not being empathetic to the actual hardship encountered.

      1. Esmeralda, But how can such disasters be prevented if we all stick our hands in the sand? I have large term deposits in Ecuador and the Coop was strongly recommended to me when I moved here years ago. Just a bit of investigation made me run away from it. But I am a former professional who knew what to look for and what to be wary of. It looked and smelled like a pyramid scheme.

        But what if I came from a culture based on greed for generations? What if that culture also discourages revealing the details of personal financial arrangements in normal casual conversation even with friends? (which is very convenient for all fraudsters!). What if I had not been a former professional?

        You would nave your brethren remain vulnerable.

        1. The point is to not be arrogantly self-righteous and blame the victim, but rather take the high road and remember that every one of us learns and grows in life by making mistakes. Better to empathize and have compassion for the victim, and then encourage him/her to stand tall, accept accountability and responsibility, and be wiser and more careful the next time around.

          1. Forgive me Robert. The last of my patience with such things left me in 2007/8. So much time and heart is lost on victim sympathy and so little on prevention. Is there a victim wish we are indulging. I would prefer to save victims before rather than cry for them after. You?

            1. Read my post, Mate. I said to sympathize, then hold them accountable and responsible, and be wiser in the future.

              Don’t you think that approach might be more readily accepted and remembered than a linguistic slap in the face?

  2. Well, we do know that the US gov’t. refused to extradite the Miami group. Now that Moreno has such a good ‘relationship’ with the US, why haven’t we seen anything about that part?

        1. Have you tried any research of your own Dog? I fear anything I might provide you with will get a prejudiced reception. So merely google “roberto and william isaias campaign contributions”.

    1. Because Moreno doesn’t have “good” relations with the US. He has a servile relation with the US. He doesn’t care about doing anything for Ecuador. He’s just making sure he has somewhere to flee to after the truth about his accounts in Panama are revealed.

  3. More proof that Correa didn’t fight corruption. You can be sure that Correa was well aware of what was happening in Ecuador.

      1. No use fretting Jason. Esmeralda is a sign of the times. She/he chooses what to believe (facts no factor) and sticks to it. Dialogue of any type is rejected. They have been around forever. They used to have a veneer of some values, but there is no evidence of that now.

        If the type wasn’t causing all the unfolding horror we are seeing globally, they would have my pity. Actually, they have my pity anyway..along with the rest of us.

    1. That may be..but, unlike you, I am loathe to condemn anyone without a fair hearing. If we applied your ruthless speculating to your favorite politicians, they would have been tarred and feathered a couple of generations ago.

      Admittedly, each society has a different reality. In a country where corruption is the norm and socially expected, how does one avoid corrupt people? Withdrawing to a monastery or convent country is not the route to a presidency. Until one is in a position to change it, one must find a way to function within the system one is given.

  4. 14% returns on idle cash …

    No effort required on your part …

    In a developing country …

    A fool and his money are soon parted.

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