His professional experience also includes serving as National Superintendent of Supervision in Ecuador and Risk Manager at the National Financial Corporation of Ecuador. Mr. Delgado obtained a Master’s in Business Economics and a postgraduate degree in Banking Administration from INCAE (Costa Rica).
In this context, the term “obtained” refers to having achieved or completed a Master’s in Business Finance and postgraduate studies in Banking Administration at INCAE in Costa Rica. How could Mr. Delgado deceive the Central Bank of Ecuador? How could President Rafael Correa not have known that Mr. Delgado, his cousin, had never actually earned the academic degrees he claimed? How is it that no one from the government or President Correa’s entourage took the time to verify the legitimacy of Mr. Delgado’s academic credentials?
Delgado is a prime example of how political appointments are made in Latin America, where qualifications for the position are utterly irrelevant and often sacrificed on the altar of political convenience.
The career of Pedro Delgado Campaña has been controversial and did not begin with the presidency of Ecuador by his cousin Rafael Correa. In 1999, at the height of the banking crisis in Ecuador, Mr. Delgado was the Credit Risk Manager of the National Financial Corporation (CFN) of Ecuador. A report commissioned in 2007 by President Correa, titled “Financial Crisis of the CFN,” published by La Vanguardia, states that Mr. Delgado drafted a memorandum (dated March 19, 1998, ref. RI 0003736) that modified credit risk assessment criteria. This reform allowed “greater flexibility regarding credit and acceptable guarantees,” resulting in CFN providing funds to financially distressed institutions. The report indicates that Mr. Delgado’s reform undermined CFN’s oversight and debt recovery mechanisms. Following Mr. Delgado’s memorandum, credit limits for troubled financial institutions were also removed, which led to CFN granting “loans totaling over $1 billion.” The total losses for CFN were estimated at $1.178 billion.
After his role at CFN, Mr. Delgado became Manager of Financial Institutions at the Superintendency of Banks of Ecuador. He is believed to have been a key figure behind the merger of Filanbanco and La Previsora, which ultimately cost millions of dollars in losses to thousands of Ecuadorians. Mr. Delgado also fabricated evidence and authored biased financial reports regarding Filanbanco, Banco Popular, and Banco Progreso, leading to state intervention, asset confiscation, and expropriation by the Ecuadorian government.
Nicolás Landes, owner of Banco Popular, subsequently sued Mr. Delgado for forgery of public documents. A judge in Quito ordered Mr. Delgado’s arrest in September 2000, after which he fled to Miami, where he lived in self-imposed exile for an undefined number of years.
Then, in 2007, his cousin Rafael Correa won the presidency of Ecuador on a platform of radical reform, including promises in the financial sector. Surprisingly, despite the enormous costs of previous actions, illegal activities, and his association with the administration of Jamil Mahuad (who faced much criticism from Correa), Pedro Delgado became the president’s trusted advisor on financial matters. Too much to break from the corrupt past…
A report on financial irregularities involving Mr. Delgado, sent to the office of President Correa and the Public Prosecutor’s Office, appeared in the Ecuadorian press. However, President Correa chose to ignore the findings and rewarded the Delgado family with a series of significant appointments. Mrs. Delgado was appointed Consul of Ecuador in Miami, and her brother, Francisco Endara, was first designated as Manager of the Banking Deposit Guarantee Agency (AGD) and later as Secretary of the No More Impunity Trust of CFN-AGD. Mr. Delgado himself, while exiled in Miami, first coordinated the Banking Commission of Ecuador (Banking Board), before having a meteoric rise in Correa’s administration.
In 2008, Carl Wolf, then President and CEO of Pacific National Bank (PNB) in Miami, wholly owned by Banco del Pacífico, which in turn is controlled by the Ecuadorian government through the Central Bank of Ecuador (BCE), sued PNB for wrongful termination. The lawsuit centered around Mr. Wolf’s refusal to:
1- make illegal payments to Andrés Baquerizo (a board member of PNB and CEO of PNB’s parent company, Banco del Pacífico);
2- hire through third parties a “known embezzler from Ecuador” (Luis Wilfrido Villacis Guillén, a convicted criminal for misappropriation of public funds related to Filanbanco);
3- reopen bank accounts that had been closed in compliance with the U.S. Bank Secrecy Act, the Patriot Act, and other federal regulations against money laundering;
4- overlook U.S. banking and anti-money laundering regulations.
Although Mr. Wolf’s lawsuit may seem unrelated, it also traces back to Mr. Delgado, who, as director of BCE, instructed Wolf to “reconstitute the lending and commercial financing operations.” According to the lawsuit, this was “in violation of the risk profile that PNB was obligated to follow in accordance with an applicable Consent Order entered at the Office of the Comptroller of the Currency (OCC) of the United States and PNB.” Delgado basically threatened to fire Wolf immediately if he refused to implement the instructions.
One of the accounts at PNB that Wolf ordered closed belonged to Cassia Delgado, secretary to President Correa and cousin to both President Correa and Mr. Delgado. Mrs. Delgado did not disclose the source of the thousands of U.S. dollars deposited into her account.
However, by that time, Mr. Delgado had firmly established himself as a power broker in Rafael Correa’s nepotistic regime. Billions of dollars in assets belonging to banks that had been intervened and expropriated in the early 1990s—largely due to Delgado’s decisions—were back in his hands as he took on the role of Director of CFN-AGD No More Impunity, a vehicle created to manage and dispose of such assets.
Delgado enlisted his brother-in-law, Francisco Endara, who was identified as responsible for an unsecured $800,000 loan granted to the Argentine Gastón Duzac, through a financial institution (COFIEC) under the control of Delgado and Endara. Shortly after the disbursement to Duzac, Mr. Delgado made a $200,000 payment for a house in Miami. The media and journalists covering these issues received death threats.
As Head of the Central Bank of Ecuador, Mr. Delgado was also in charge of establishing triangulation mechanisms that, using Ecuador’s banking system and the dollar-denominated foreign exchange market, would have allowed Iran to circumvent OFAC and other international sanctions. Press reports indicate that Mr. Delgado “arrived on April 3 at Khomeini Airport in Tehran, with a delegation that included his brother-in-law Francisco Endara, who was coordinator of the Technical Secretariat of the Trust and now an advisor to bank COFIEC (currently a fugitive for irregular loans granted to DUZAC).
The purpose of the trip is believed to have been to sell seized companies and assets by the Ecuadorian government to Iran.
Reports also state that “Seven months after his visit to Iran, Delgado intervened to facilitate the deposit of the Iranian Embassy of USD 1.8 million in cash at COFIEC. On November 15 and 24, 2011, deposits were made into an Iranian Embassy savings account: USD 112,834, 500,000, and 1,360,000.”
On another trip, Mr. Delgado met with representatives of Pasargad Bank, Export Development Bank (EDBI), Saman Bank, and Parsian Bank to discuss the sale of COFIEC. Delgado also met in Moscow with representatives authorized by OFAC from Bank Melli of Iran. Reports claim that while in Moscow, Delgado hid $500,000 in cash in a safe deposit box.
All these revelations have had consequences back in Ecuador. While President Correa showed no initial reservations in firmly supporting his cousins [Pedro and Cassia undefined], the mounting evidence eventually exposed his nepotism. Driven by allegations from a congressman, the Attorney General’s Office of Ecuador has initiated four investigations against Mr. Delgado for:
1- illegal expropriation of companies and money transfers to Switzerland,
2- doubts regarding his wealth,
3- responsibility in the banking crisis during his tenure at CFN,
4- and illegal purchase of a house in Quito.
Moreover, Ecuador requested the United States to revoke Mr. Delgado’s visa, which was immediately granted. However, statements from Ecuador’s Secretary of Foreign Affairs, Ricardo Patiño, referring to Mr. Delgado as a traitor, may well be mere posturing.
Regardless of what the future holds for Delgado, it remains concerning that a fully aware President Rafael Correa placed Delgado at the head of the Central Bank of Ecuador and then protected him even after it became publicly known that he was a fraudster and money launderer. Mr. Delgado is a man who has abused the law and his positions to steal private property. He is an individual whose life and background are entirely based on lies and fabrications and, as a consequence, has such a dysfunctional moral compass that he engages with Islamic fundamentalists and terrorists. But perhaps most importantly, he is a person whose actions in a public office have caused losses of billions of dollars to thousands of Ecuadorian citizens.