"Suitcase Scandal" is Another U.S. Foreign Policy Blunder

The now infamous "suitcase scandal" has deeply alienated the new Argentine government and is likely to further sully Washington's reputation in Latin America.

On December 20 the U.S. government indicted four Venezuelans and one Uruguayan for allegedly acting as foreign agents without notifying the U.S. government. The charges stem from an incident that occurred on August 4 when Guido Antonini Wilson, a Venezuelan/American with dual citizenship, was stopped at Argentine customs with about $800,000 cash in a suitcase.

The U.S. Justice Department alleges that the money was intended for the election campaign of Cristina Fernandez de Kirchner, who was elected president of Argentina on October 28. Of course this would not violate U.S. law, even if it were true; nor would the Feds' charge that the money came from the Venezuelan government. What makes it a Federal case is the charge that the defendants, allegedly acting on behalf of the Venezuelan government, tried to convince Antonini to keep quiet about the alleged origin and destination of the money.

Thus the men are indicted for failing to notify the U.S. Attorney General that they were acting as agents of a foreign government (Venezuela).

The charges have deeply alienated the new Argentine government, which by all accounts was poised to increase its engagement with the United States. President Cristina Fernandez immediately dismissed them as "garbage," and her government accused Washington of using "dirty tricks" to intimidate her and attempt to drive a wedge between Argentina and Venezuela. Her husband, former president Nestor Kirchner, demanded that the U.S. surrender the fugitive Antonini, for whom the Argentine government has repeatedly sought extradition from the United States.

The case is clearly a major foreign policy blunder for the Bush Administration. There is no love lost in relations with Venezuela, which have been in the toilet since the Administration backed a failed military coup against President Hugo Chavez in 2002. But U.S.-Argentine relations have been cordial, despite the country's deep resentment of the Washington-run International Monetary Fund (IMF) for its role in Argentina's severe economic crisis (1998-2002), and were set to improve.

Not only Argentina, but most of the region, will likely see this prosecution as a gross political interference on the part of United States government in the internal affairs of its neighbors. No one will believe, nor should they, that it is merely a matter of "enforcing U.S. laws," as State Department spokesman Sean McCormack told the media.

Edmund McWilliams, a retired Senior Foreign Service Officer here in Washington, cited other cases where "the Justice Department subordinated the pursuit of justice to Administration foreign policy objectives." He noted that this prosecution "may have been at the instigation of the Administration itself."

It sure looks that way. There has never been an indictment under this law (18 USC § 951), or its accompanying conspiracy statute (18 USC § 371) - without there at least being another accusation involving some kind of alleged espionage, and some kind of potential U.S. national security issue. In this case, it is really only the failure to notify the Attorney General that is the basis of the alleged crime. And the case may be even weaker than that: almost all of the indictment is devoted to the conspiracy charge, which indicates that the government may not even have any real evidence that the defendants were acting under orders from the Venezuelan government.

This particular case also does not smell good on its merits. The star witness is the man with the suitcase (Antonini), who has not been charged. Since he is wanted for money laundering in Argentina, he might well see his current liberty as dependent on saying and doing whatever the U.S. government wants.