Ex-Argentine Leader Faces Bribery Probe


Swiss and Argentine authorities are investigating an allegation that former Argentine President Carlos Menem received a $10-million bribe from Iranian agents to cover up Tehran’s alleged role in an anti-Semitic terrorist bombing in Buenos Aires in 1994, officials said Wednesday.

Swiss authorities opened an inquiry in Geneva last week based on a request from Argentines investigating the van bomb attack that killed 85 people at the Argentine-Israelite Mutual Assn. community center, according to Folco Galli, a spokesman for the Swiss Federal Justice Office.

In October, Swiss authorities froze nearly $10 million in two bank accounts allegedly linked to Menem during a separate Argentine investigation of an international arms trafficking ring, Galli said in an interview.

Now a magistrate in Geneva is pursuing testimony of a former Iranian spy who told Argentine investigators that Menem was paid $10 million via a Swiss bank in exchange for a promise to say there was no proof against Iran in the terrorist attack, according to Swiss and Argentine officials.


One frozen account is in a Geneva bank in the name of Menem’s daughter and former wife, Galli said. The other account bears the name of a company allegedly linked to Menem, he said, and investigators want to know whether Menem had additional Swiss accounts.

In a post-Sept. 11 world focused on terrorism, the case contributes to renewed concern about Iran’s alleged sponsorship of Hezbollah and other terrorist groups. Argentine, U.S. and Israeli officials are convinced that the Jewish center bombing and an unsolved 1992 bombing of the Israeli Embassy in Buenos Aires were the work of Iranian spies and Hezbollah with local accomplices.

The discovery of the Swiss accounts comes after years of accusations that Menem and his inner circle made millions from kickbacks and arms and drug trafficking. He has repeatedly denied such charges.

Political Plans Sinking Under Claims

But the allegation that Menem helped engineer a cover-up in the 1994 attack speeds the downfall of the former leader, who recently announced that he will run for president again in 2003. His 1989-99 presidency was a whirlwind of scandal and free-market transformation that spurred rapid growth and made him a favorite of U.S. diplomats and investors. Weakened by skyrocketing debt, however, the Argentine economy foundered in his final years in office and has slid into all-out collapse in recent months.

Although Argentina’s Supreme Court ordered his release from house arrest in the arms case late last year, Menem remains the target of corruption probes and public condemnation in a crisis-torn country governed by his archenemy, newly installed President Eduardo Duhalde.

Critics say Menem, the son of Syrian immigrants, obstructed the Jewish center and embassy bombing investigations to hide his government’s ties to Middle Eastern terrorism and organized crime.

“We always had many obstacles of all kinds,” prosecutor Jose Barbaccia, who has worked on the 1994 case since the bombing, said in a phone interview. “We never saw the supposed political will translated into deeds. For example, the police anti-terrorist squad was created three years after the attack. For a long time, we worked with only eight police investigators.”


Argentine investigators will probably seek to question Menem after the Swiss have had time to investigate, Barbaccia said.

“If this is true, we are not just talking about [corrupt cops] but total political protection,” Barbaccia said. “But the [Iranian] witness did not give an exact date or an account number. That makes the investigation more difficult. We have to interrogate this witness again now that we know about the accounts. And we must see what the Swiss find.”

No one was charged in the embassy case. In the Jewish center case, a small-time gangster and a group of police officers are on trial for allegedly providing the stolen van that was used as a rolling bomb.

The new Iran-related investigation could be another in a series of promising leads that ran into dead ends. It could even be attempted retaliation by Duhalde against Menem, who has criticized the president’s handling of the economic crisis.


“My first reaction was that it might be Duhalde getting back at Menem,” said Rabbi Abraham Cooper of the Los Angeles-based Simon Wiesenthal Center, which has followed the Argentine cases closely and has pushed for answers. “You are always going to have to take what happens in this case with not a grain of salt, but a quarry of salt.”

The Jewish center case figured in a brutal feud between Menem and Duhalde that began in 1996 when Duhalde was governor of Buenos Aires province and a presidential hopeful determined to thwart Menem’s designs on a third term. Many observers saw the federal indictment of police officers from Duhalde’s province as terrorist accomplices as a political ambush by the Menem administration. Duhalde soon returned fire when provincial authorities filed murder charges against a mysterious tycoon close to Menem in an unrelated case.

Nonetheless, now there is a money trail to follow. And the Swiss justice system is well removed from Argentine political intrigue.

“If this turns out to be a smoking gun,” Cooper said, “we want a commitment from the Argentine judicial and political leadership that this man goes on trial.”


Latest Development Was Slow in Coming

Like other developments in a glacially slow case, this one did not happen overnight. The secret witness, who was once the No. 3 official in Iran’s spy service, first testified to Argentine investigators in 1998 in Germany, where he lived under the protection of German authorities and helped resolve Iranian terrorist acts.

The witness, identified only as C, testified that Iranian agents masterminded the 1994 bombing but said he had information he would withhold until Menem left power, according to Argentine officials. Soon after Menem stepped down, the witness testified again, this time in Mexico. He told interrogators about the alleged bribe in Switzerland, saying Iranian operatives paid it either directly to Menem or someone close to him, Barbaccia said.

The witness testified that the money changed hands as investigators zeroed in on Iranian diplomats in Argentina--police eventually said a cultural attache was the suspected mastermind.


Over the years, Menem’s comments about the case mixed promises of justice with steadfast defenses of his government. The victims’ families complained that he never met with them to express condolences.