U.S. Senator Robert Menendez denied any wrongdoing after NBC 4 New York reported the U.S. Justice Department was probing his efforts to help two fugitive bankers living in Florida avoid extradition to Ecuador.
Investigators are examining whether Menendez, a New Jersey Democrat, broke the law in trying to help William and Roberto Isaias stay in the U.S., NBC said, citing “multiple current and former U.S. officials” it didn’t name. The brothers were convicted in absentia for embezzling millions of dollars from Filanbanco, which they ran before it collapsed, NBC said.
Menendez, chairman of the Foreign Relations Committee, wrote letters and made phone calls to the State Department and Department of Homeland Security on behalf of the brothers, who are seeking permanent residence in the U.S., NBC reported.
“We are not aware of any inquiry into the senator’s actions on this matter,” Tricia Enright, a spokeswoman for Menendez, said in an e-mail yesterday.
Menendez last year denied allegations that he helped Salomon Melgen, a Florida eye doctor and political donor, by intervening in a Medicare-billing dispute and aiding Melgen’s company to enforce a port security contract in the Dominican Republic. Melgen had been the subject of a Medicare probe, and U.S. agents twice raided his offices.
“A year after a false smear campaign was launched against Senator Menendez, once again we see anonymous sources making outlandish allegations,” Enright said in the e-mail. The senator’s office works with hundreds of people each year seeking help with the immigration process, she said.
“Senator Menendez believed the Isaias family had been politically persecuted in Ecuador, including through the confiscation of media outlets they owned which were critical of the government,” she said.
Justice Department spokesman Peter Carr declined to comment on the report.
NBC quoted an attorney for the Isaias brothers, Xavier Castro Munoz, as saying they are innocent, didn’t steal money and are victims of political persecution in Ecuador.
The network reported that investigators were looking at whether Menendez tried to help the Isaias brothers in exchange for campaign donations. Federal Election Commission records show members of the family have given to mostly Democratic candidates and causes, including a $2,300 donation to Menendez by Roberto’s son, Luis.
The Isaias brothers released a statement today decrying the “lack of fairness and due process in Ecuador’s judicial system.” They denied that the political donations were improper.
“We know firsthand how democracy, human rights, freedom of the press and due process has been trampled in Ecuador,” the brothers said in the statement. Any donation by any member of the family was made “in a normal and legal manner in accordance with federal election laws,” they said.
Roberto and William Isaias ran Ecuador’s largest bank, Filanbanco, in the mid-1990s. In 2009, Ecuador sued them in state court in Miami, claiming they embezzled hundreds of millions of dollars from the bank and transferred “substantial sums” to Florida.
Last May, Circuit Court Judge John Thornton dismissed the complaint, ruling that Ecuador hadn’t met the U.S. legal standards required to seize their property.
Ecuador accused the Isaias brothers of hiding Filanbanco’s liquidity problems before the 1998 banking crisis in that country. Ecuador issued arrest warrants for both brothers in 2003. They fled to Miami.
Thornton, citing law going back to a 1965 case involving the property of King Faisal II of Iraq, concluded that the government of Ecuador hadn’t obtained a court order in its own country to seize the brothers’ property. He also said Ecuador’s government decree seeking to seize it violated “several of the most foundational underpinnings of U.S. law and policy, including due process.”
“The defendants may have committed the wrongs which Ecuador has alleged,” Thornton wrote. “However, the manner in which Ecuador has attempted to right the defendants’ alleged wrongs is inconsistent with U.S. law and policy.”