Colombia declares emergency over investment scams

The Times' Chris Kraul reports:

Colombian government officials declared a state of emergency Monday, boosting their powers of arrest and money seizure, to help deal with multimillion-dollar investment scams that have targeted mostly poor investors.

Panic spread last week among investors across Colombia after one suspect financial agency halted payments. Disturbances broke out in 12 states, police said, and investors stormed offices in the southwestern cities of Pasto and Popayan, threatening to lynch the managers.

Police closed 59 offices belonging to DMG, one of the largest among dozens of firms under investigation. Gen. Orlando Paez Baron said he had stationed riot police at the offices in advance of seizing records and confiscating the firm's remaining cash.

In the last week, police have arrested 52 employees from several financial agencies on suspicion of fraud, confiscating $30 million, which they say will be distributed to investors.

President Alvaro Uribe's office said the declaration of emergency was made in view of the "serious deterioration in public order" in connection with "massive illegal collection of public funds."

Read more of "Colombia declares emergency over investment scams."

-- Deborah Bonello in Mexico City

Comments

[carlos valenzuela]

What the Colombian government is doing: jail for the leaders of the scam, confiscation of the money the took, is a good example of what should be done with the people involved with the toxic home loans in this country. People over there expressed their anger and moved the government to take action. Here we keep our mouth shut.
Gervase