smashing Argentine banks

["Ian Murray" <seamus2001@xxxxxxxxx>]

[are the computers being hacked to generate contagion...]

In Argentina today, the police raid foreign banks

· Hunt for 'convoy of cash' evidence
· Central banker quits

Jill Treanor, Charlotte Denny and Uki Goni in Buenos Aires
Friday January 18, 2002
The Guardian

Police in Buenos Aires made dawn raids on foreign banks,
including HSBC, yesterday as part of an investigation into
allegations that billions of dollars was smuggled out of
Argentina in the days before its financial collapse last
month.

The investigation into reports that the regime of the
former president, Fernando de la Rua, allowed $10bn to
disappear offshore came as the slide into economic chaos
continued with the resignation of the central bank
governor, a sharp drop in the stock market and a further
decline in the value of the peso.

A Peronist deputy, Eduardo di Cola, said the police action
was triggered by the discovery of a dramatic fall in the
country's dollar reserves, which were much lower than they
should have been.

Mr de la Rua imposed strict controls on bank withdrawals
and money transfers abroad in December as the economic
crisis intensified, but the new government says that some
banks and companies were given warning in advance of the
measures.

The raids were sparked by Franco Caviglia, a member of the
lower house of congress. Last week, he demanded an
investigation into 358 armoured trucks that are believed to
have transported billions of dollars in high-denomination
bills from banks in Buenos Aires to the international
airport in late November, shortly before the ban was
imposed on foreign remittances.

"The money seems to have been sent on regular commercial
flights to Uruguay," said Mr Caviglia.

Uruguay is known as "the Switzerland of South America"
because of its banking secrecy laws and small size. Most
Argentine banks have "offshore" branches in the country,
which is a half-hour plane hop away from Buenos Aires.

A spokesman for HSBC, which has 60 branches in Argentina,
said: "We had a visit from the federal police overnight. We
are one of several banks that were visited in this way. We
are offering our full cooperation and collaborating fully
with the authorities."

The international banks believe they are regarded as an
easy target for the authorities which are looking for
scapegoats for the economic crisis. Several took out
full-page advertisements in local newspapers yesterday
blaming the government for the disintegration of Latin
America's third-largest economy.

The Merval index of leading shares dropped by almost 6%
when the Argentine stockmarket opened yesterday after being
closed for much of the past month. The peso, which the
government released last week from its 10-year peg against
the US dollar weakened to $1.9-$2 yesterday, a 50% fall.

The fresh turbulence on the markets coincided with the
resignation of Roque Maccarone, severely criticised for his
handling of the introduction of new banking regulations,
and his replacement as central bank governor by his deputy
and former IMF economist, Mario Blejer.

The lower house of congress was expected last night to
approve the creation of a special committee to investigate
the allegations of capital flight, which have served to
further inflame an already angry Argentine public.

There were renewed violent protests across Argentina
yesterday, with the government announcing that it will take
police off border duty to patrol the increasingly lawless
streets.