By Michael E. Miller
By Allie Conti
By Keegan Hamilton and Francisco Alvarado
By Jake Rossen
By Allie Conti
By Kyle Swenson
By Chris Joseph
By Michael E. Miller
Paraguayan Central Bank leaders initially denied knowing anything about the $16.7 million, but this past February Gonzalez Ugarte and the bank's president, Washington Ashwell, acknowledged the money had been sent out of the country -- apparently in violation of Paraguayan laws -- with the aim of gaining a high yield. Throughout the spring ABC Color and other Paraguayan newspapers continued to publish daily stories on the misappropriation of the money. On April 30 Paraguayan authorities arrested bank supervisor Pecci.
Meanwhile in South Florida, Soccer Fanatic had published its first issue April 2 at a press owned by Gannett Inc. (where New Timesis printed). A front-page editorial in the premier 72-page broadsheet claims a circulation of 80,000 in seven Florida counties. New York, California, and Washington, D.C., as well as an English-language edition were all in its sights, according to the editorial. On page 2 Gonzalez (Ugarte) is listed as director -- just after the names of Caligaris and Agustin Matiauda.
But as things heated up in Paraguay, Gonzalez Ugarte apparently couldn't deliver the promised $1 million. On May 3 ABC Color reported that President Gonzalez Macchi had fired Central Bank president Ashwell and requested that the senate remove Gonzalez Ugarte from the bank's board.
On May 14 Bareiro wrote a story on Soccer Fanatic's ownership, distribution, and content in which he asserted that "Gonzalez [Ugarte] and other Paraguayan partners had acquired the newspaper in late 2000 or early 2001" and that the paper was paying $8000 per week for printing. Bareiro could not confirm Gonzalez Ugarte's ownership or presence at the office.
In the weeks that followed, however, Bareiro developed a stronger case that the president's family had some knowledge of the money's fate. On May 29 he alleged Paraguayan prosecutors had learned that Citibank transferred millions of dollars to three accounts at Ocean Bank. The "beneficiary" of the accounts, Bareiro wrote: the South Florida-based Paraguayan Humanitarian Foundation, which lists two acquaintances of Gonzalez Ugarte -- José Avila and Juan Rodriguez -- as directors.
Though the secret Treasury Department document confirms Avila's tie to a small portion of the money, Avila contends he never received a nickel. "The reporting from Paraguay is untrue," he says. "It's simply the wrong information." He declines to elaborate, adding that the foundation has "lawyers, trustees, accountants."
Bareiro's May 29 story also noted that the president's daughter, Judith Gonzalez Macchi, had traveled to Miami in the spring of 2000, around the time the money was transferred to Ocean Bank, and signed a business agreement with Avila. She allegedly wanted Avila to help collect money for Doña Lola de Miño, a foundation she had established.
On June 4 Bareiro described a boat trip the Paraguayan president, his wife, and their entourage took from a Coconut Grove marina. The trip, on a yacht called the Natasha II, cost $5000. (Bareiro describes seeing Avila's name on the yachting contract, but Avila denies footing the bill. "I never paid that," he says.)
Three days later came the coup de grâce: a report that the president's father, Saul, confirmed to prosecutors his family's involvement in the illegal transfer. The president's brother, Jose Ignacio, also allegedly knew of the funneling. Moreover, Gonzalez Ugarte had promised donations to Judith Gonzalez Macchi's foundation.
Bareiro won't disclose all his sources, but Paraguayan prosecutor Javier Contreras confirms most of the young reporter's work. He adds that "we are investigating the case and suspect Gonzalez Ugarte's involvement with Soccer Fanatic in Miami." Last week Contreras's office sent Gonzalez Ugarte to federal prison.
Where does that leave the newspaper? It's doing relatively well, claims Agustin Matiauda. Gonzalez Ugarte "didn't pledge any money," Matiauda comments. "He said he was going to show our project to others and see if they were interested." Matiauda says he and Caligaris found other sources of capital but declines to discuss details of the newspaper's finances.
But several facts published in Soccer Fanatic cast doubt on Matiauda's credibility. Although the initial issue reads "Our circulation begins with 80,000 copies in Florida," Matiauda acknowledges that number "was only a target." Though he declines to discuss present figures, sources told New Timesthat the number printed has recently dipped from 20,000 to 10,000.
And though the masthead in the June 18 Soccer Fanatic states that the paper is published twice weekly, Matiauda acknowledges that the truth is once per week. Finally the masthead claims the paper is distributed in Monroe County, Orlando, and Tampa. But Matiauda admits that's a mistake. Distributors take it only to Miami-Dade, Broward, and "a little bit of Palm Beach.... These are little things that are all part of publishing a newspaper," Matiauda contends. "They can be fixed." Staff intern Victor Thompson contributed to this report.