Bloomberg the Company & Products

Bloomberg Anywhere Login


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Ecuador Opens Probe Into Banks After Tax Dispute With Correa

Don't Miss Out —
Follow us on:

Jan. 15 (Bloomberg) -- Ecuador is investigating whether banks violated antitrust laws when they warned customers that anti-poverty taxes proposed by President Rafael Correa risked undermining the country’s financial system.

Pedro Paez, the nation’s chief anti-monopoly watchdog as head of the Superintendency for Control of Market Power, said he’s probing whether the South American country’s largest lenders acted in concert last year when they sent e-mails about the levies. Violations may result in fines of as much as 12 percent of annual sales, he said. He didn’t identify the banks.

“We’ve got a collective, simultaneous action from the most important banks, the dominant operators in the market,” Paez, a 48-year-old former economics professor, said in an interview at his home in Quito. “We began the investigation. We still don’t know all the facts.”

Correa, 49, has criticized banks for using their financial clout to influence national politics as he runs against former Banco de Guayaquil SA Chief Executive Officer Guillermo Lasso in presidential elections scheduled for next month. The country passed the tax in November to raise $320 million for anti-poverty programs that pay qualifying families monthly cash subsidies of $50.

The antitrust inquiry is probably a scare tactic to warn other industries not to oppose the president’s policies, said Walter Spurrier, the director of Guayaquil-based economic researcher Grupo Spurrier. Any fines will be minimal, since the government wants to send a message, not break the banks, he said.

“The law opens the door to call collusion anything that represents action from an association in defense of its interests,” Spurrier said in a telephone interview yesterday. “It’s to be able to attack any organization that disagrees with public policy.”

After the government proposed its tax bill in October, the country’s four largest banks, Banco del Pichincha CA, Banco de Guayaquil, Banco de la Produccion SA and Banco Bolivariano SA, sent e-mails to clients, made phone calls and ran television advertisements critical of the plan, the president’s office said in a Nov. 19 statement in its official gazette.

The next day the country’s banking regulator said it had fined the banks’ top officers $7,886.82 each over the matter and accused them of “sending confusing messages that could generate adverse reactions or interpretations with irreparable consequences in detriment of the public interest.”

Officials from Quito-based Pichincha met with the superintendency in December to discuss the bank’s communications to clients, Deputy Chairman Antonio Acosta said today in an e-mailed statement. Pichincha hasn’t heard back from the agency since, he said.

Officials at Guayaquil, Produbanco and Bolivariano didn’t immediately reply to telephone messages seeking comment on the investigation.

Paez, a former economic policy minister under Correa who was nominated to the antitrust post by the president, said he has as long as 480 days to conclude the investigation.

To contact the reporter on this story: Nathan Gill in Quito at

To contact the editor responsible for this story: David Papadopoulos at

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.