Pinochet Charged With Tax Evasion

by Leroy Baker, Tax-News.com, Washington

28 November 2005

Former Chilean dictator Augusto Pinochet has had bail set by an appeals court in the Chilean capital Santiago after being charged with tax evasion.

The court set bail at 6 million pesos (US$11,400) - half of the amount requested by the investigating judge who last week charged Pinochet and placed him under house arrest.

The Chilean tax agency has asked for bail to be set at 120 million pesos, representing one-tenth of the amount of tax that Pinochet has allegedly evaded.

The former army general, who seized power in a coup d'etat in 1973 and ruled Chile until 1990, is said to have evaded taxes by hiding money in various foreign banks accounts, including in the Bahamas, the Cayman Islands, Columbia, Germany, Panama, Spain, the United Kingdom and the United States. He is also accused of using false passports to open bank accounts, submitting a fake government document to a foreign bank and filing a false report on the size of his assets.

Pinochet's defence team argued that the former leader had earned the money legitimately, and had chosen not to report the foreign accounts to avoid political persecution.

His accusers however, contend that the most likely source of Pinochet's income was commissions earned from arms manufacturers for buying and selling weapons.

Nonetheless, given Pinochet's age (he turned 90 last week), and failing health, it is doubtful whether prosecutors will get him to actually stand trial, and he has escaped judgment on previous occasions on these grounds.

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