MEXICO CITY — TV Azteca has requested that a US court drop charges against it in a fraud trial involving the Mexican net and three of its principals, set to begin as soon as the last day of this month.
If the US District Court in Washington accepts Azteca’s petition, the trial would focus only on Azteca chairman Ricardo Salinas, former Azteca CEO Pedro Padilla, and Luis Echarte, prexy of Azteca America, net’s Stateside broadcaster, all of whom would be tried as private individuals.
The request is based on the net’s contention that the actions of Salinas and the others in a 2003 debt deal netting Salinas and a separate partner $218 in undeclared profits were completely removed from Azteca operations. “Any purported fraudulent intent alleged in the complaint as to the individual defendants may not be imputed to TV Azteca,” Azteca wrote in the filing.
Potentially supporting Azteca’s argument is the fact that only $50,000 of the $2.5 million in fines handed down by Mexico’s securities regulator in its own investigation of the case were applied to Azteca itself, with the great majority distributed among Salinas and other principals.
The plea is significant in light of the news earlier this month that Salinas plans to take Azteca and two other companies he controls, telco Iusacell, and retailer Elektra, off the NYSE. Freeing Azteca from prosecution for fraud would further isolate the net from SEC regulation, something it has lately complained is too severe and discriminatory against foreign businesses.
On that note, Azteca said in a press release Thursday night that it had programmed an extraordinary stockholders meeting for May 30, presumably to vote on delisting from US markets. That is one day prior
to the scheduled starting date for the civil fraud trial being prosecuted against Azteca by the SEC.
Azteca has been mired in the alleged fraud scandal since December 2003, and has seen its stock price fall precipitously since the SEC filed charges in January of this year.