TV topper may face two to seven years behind bars
MEXICO CITY– In the latest in an increasingly ugly sequence of events, Mexico’s Finance Ministry has filed criminal charges against the chairman of TV Azteca, Ricardo Salinas Pliego, for “unlawful use of privileged information.”
The charges Friday came only a day after Mexico’s securities regulator slapped the net and several execs with $2.4 million in fines for securities violations in a 2003 debt deal, and just three days after Azteca sued finance minister Francisco Gil Diaz for “abuse of authority, intimidation, attempted extortion and censorship.”
The Finance Ministry did not disclose details of the charges, but sources close to it said that they might be related to insider trading. If Salinas is found guilty, he could face between two and seven years in prison.
In addition, a guilty verdict would likely cost him the right to direct any credit-related business in Mexico and any company publicly traded on U.S. stock markets. TV Azteca, Mexico’s second-largest broadcaster, is traded on the NYSE and Mexico’s Bolsa exchange, while Salinas is head of a handful of Mexican businesses that offer small loans, including his Elektra electronics franchise.
Since the end of 2003, TV Azteca and its principals have been under investigation by the Securities and Exchange Commission and Mexico’s National Banking and Securities Commission (CNBV) for alleged fraud in the refinancing of debt held by Unefon, which is owned by Salinas. That transaction netted Salinas and a partner over $200 million, a fact that was not made public by the chairman.
In January, the SEC filed fraud charges against Salinas and several other execs; that trial is set to begin after May 31. The SEC has said it is opposing any motions to further extend the trial date because of Azteca’s “totally obstinate” attitude in terms of cooperation.
On Thursday, the CNBV announced a series of fines against Salinas and others totaling 27 million pesos ($2.42 million), concluding its investigation of the net.
For his part, Salinas has long denied any wrongdoing. But observers said the peculiar series of events of the past week, in which the net accused the Finance Ministry of attempting to prevent it from broadcasting a series of reports about a 2001 bank merger, are indicative of a certain business style preferred by the enigmatic chairman. He is known for publicity stunts and alleged threats behind closed doors.
Azteca has vowed to appeal the CNBV fines.