Vice President Óscar Ortiz (right) with President Salvador Sánchez Cerén

In June 2000, Óscar Samuel Ortiz -- the mayor of the town of Santa Tecla at the time and current vice president of El Salvador -- founded a real estate company with José Adán Salazar Umaña, alias "Chepe Diablo," who the United States listed as a drug trafficking kingpin in 2014.

On May 4, 2014, it looked like rain in Metapán. The heavy clouds and a few drops did not manage to disrupt the soccer match being played in the local Jorge "Calero" Suárez stadium, between the Isidro Metapán Sports Association and the Santa Tecla teams. In the audience, Óscar Ortiz -- vice president elect of El Salvador at the time and director of the Tecla soccer club -- and Juan Umaña Samayoa, the mayor of Metapán and president of the local club, were watching the game.

This article was originally published by Revista Factum and La Prensa Gráfica, and was translated, edited for clarity, and reprinted with permission. Its views do not necessarily reflect those of InSight Crime. See Spanish original here.

That day, the other strongman of Metapán -- the team and the city -- was not at the stadium: José Adán Salazar Umaña, known as "Chepe Diablo," who was listed by the United States as an international drug trafficking kingpin in the final days of May 2014. Both Salazar Umaña and Umaña Samayoa have been linked by police investigations to the Texis Cartel, one of the main drug trafficking and money laundering organizations in El Salvador, according to a United Nations report from 2012.

SEE ALSO:  Chepe Diablo Profile

Salazar Umaña's and Ortiz's names have appeared together since 2000, when both men set up, in collaboration with a third associate, a company dedicated to buying and selling property: the Montecristo Development Society (Desarrollos Montecristo). The society was established at noon on June 20, 2000. Ortiz had been sworn in as mayor of Santa Tecla for the Farabundo Martí National Liberation Front (Frente Farabundo Martí para la Liberación Nacional - FMLN) political party a few weeks earlier, on June 1.

Those days were, for Ortiz, the beginning of a political career that led him to be re-elected four times as Santa Tecla's mayor and eventually become one of the most important figures in the leftist party. In 2014, he became the vice president of the Republic of El Salvador.

Nowadays, Ortiz is perhaps the most important politician in President Salvador Sánchez Cerén's administration: he is the public face of the public security strategy and, on many occasions, he fills the role of head of state.

Such is the case this week. During the visit of Colombian President Juan Manuel Santos, Ortiz has been the one accompanying the South American leader to the majority of official events.

Factum and La Prensa Gráfica requested a statement from Ortiz regarding his partnership with Salazar Umaña, but one of his assistants replied that the vice president was occupied this week due to President Santos' official visit. Ortiz confirmed his relationship with "Chepe Diablo" to the online newspaper El Faro, and insisted that this did not entail any illegal activity.

The Partnership

Desarrollos Montecristo S.A. de C.V. was registered at the public notary Salvador de Jesús Tobar Ruiz in the city of Santa Ana on June 20, 2000, with an initial payment of 105,000 Salvadoran colones (around $12,000) paid in three equal installments of 35,000 colones (around $4,000) by the three founding partners: Ortiz, Salazar Umaña and the businessman Rogelio Cervantes, who in 2003 ran unsuccessfully for mayor of Antiguo Cuscatlán, a municipality bordering Santa Tecla.

Little more than a month later, Desarrollos Montecristo was established in the Register of Commerce and was headquartered in the municipality of Antiguo Cuscatlán. In its formal registration certificate, the three founders established six objectives or social aims -- the activities to be carried out by the new business. The most important of these activities was the buying and selling of real estate for tourism purposes.

SEE ALSO:  El Salvador News and Profiles

Salazar Umaña had become involved in the hotel industry two years before founding Montecristo. According to a financial investigation opened in 2013 by the US Treasury Department's Office of Foreign Assets Control (OFAC), in 1998 Salazar Umaña founded Hotesa S.A. de C.V., a consortium of six hotels in El Salvador to which he contributed 60 percent of the initial capital.

Montecristo's commercial aims are the same as those of Hotesa. Paragraph A in the objectives section of Desarrollos Montecristo's founding document states: "The buying and selling of real estate for urban development or in any branch of tourism, establishing travel agencies inside and outside the country, hotel operations, convention centers and everything related to the commercialization of the tourism industry."

But contrary to Hotesa, which according to OFAC's investigations managed to increase its capital by 500 percent between 2004 and 2010, Montecristo only carried out a handful of land sales in San Vicente between 2000 and 2012, worth no more than $40,000 per transaction. But the buyers and sellers, in the case of Montecristo, were always the same: the founding partners Óscar Ortiz and Rogelio Cervantes.

One Business, Few Clients

Between July 31, 2000, and December 7, 2012, Desarrollos Montecristo and two of its founding partners, Ortiz and Cervantes, made eight transactions concerning three properties. They were all located in the Tecoluca municipality of San Vicente, near the Montecristo estate where Ortiz had bought at least 12 plots of land between 1998 and 2000, according to the National Registry (Centro Nacional de Registros - CNR).

Neither in the CNR nor in the Registry of Commerce is there any proof of other transactions having been made by Desarrollos Montecristo or its partners through the company between 2000 and now.

The most recent transaction by Desarrollos Montecristo, as noted above, was in 2012, but the company continues to be active and there have been no registered changes in its board of directors, which since 2000 has been composed of: José Adán Salazar Umaña, vice president director and legal representative; Óscar Samuel Ortiz Ascencio, secretary director; José Adán Salazar Martínez, deputy director; Elda Gladis Tobar (wife of Ortiz), deputy director; Noé Eugenio Cervantes Salazar, deputy director; and Rogelio Antonio Cervantes Aguirre, legal representative, according to Section 46 in Book 1544, pages 380 to 395 of the Property Register.

On July 31, 2000, Desarrollos Montecristo registered its first property transaction. On July 23, 2007, the company sold lot number M58 portion 1 in Tecoluca, San Vicente to its secretary director Óscar Ortiz, for $40,000. Little less than a year later, on May 26, 2008, Ortiz sold the property to Cervantes -- his partner -- for the same price. And on December 7, 2012, Ortiz -- then mayor of Santa Tecla -- once again bought the property for $10,000.

In the year 2000, Ortiz named Cervantes legal representative so that, under the company's name, he could sell him lot M58 portion 1, according to the Property Register.

Between August 3 and 14, 2000, Ortiz acquired another two plots of land through Desarrollos Montecristo: M29 portion 1 and M30 portion 1, at a total price of $15,000. Both plots are also in the Montecristo estate in Tecoluca.

In total, the vice president of the republic bought 52,461.18 square meters (5.25 hectares) of land through Desarrollos Montecristo, in which he has been a partner of "Chepe Diablo" and Rogelio Cervantes. (See charts below)

 

  REGISTRATION 70045040-00000

19,246.4 m2

Plot #M58, Portion 1, Montecristo

Tecoluca, San Vicente

Record of Registration M06012460

OWNER

FROM

UNTIL

NOTARY

AMOUNT

PERCENT

Desarrollos Montecristo, S.A de C.V.

31 July 2000

23 July 2007

   

100%

Óscar Samuel Ortiz Ascencio

23 July 2007

26 May 2008

Leticia Orellana Calles

$40,000

100%

Rogelio Antonio Cervantes Aguirre

26 May 2008

7 December 2012

Leticia Orellana Calles

$40,000

100%

Óscar Samuel Ortiz Ascencio

7 December de 2012

 

Nelson Eduardo Rauda Rodas

$10,000

100%

 

  REGISTRATION 70047126-00000

8,147.71 m2

Cantón Montecristo, Tecoluca, San Vicente.

Registration Plot M29. Portion 1 

OWNER

FROM

UNTIL

NOTARY

AMOUNT

PERCENT

Desarrollos Montecristo, S.A de C.V.

3 August 2000

16 April 2010

José Luis Francia Sánchez

 

100%

Óscar Samuel Ortiz Ascencio

16 April 2010

 

Dina Alhely Castellón Cruz

$5,000

 

 

  REGISTRATION 70092479-00000

25,067.07 m2

Plot #M30, Portion 1, Montecristo, Tecoluca, San Vicente.

Record of Registration M06012428

OWNER

FROM

UNTIL

NOTARY

AMOUNT

PERCENT

Desarrollos Montecristo, S.A de C.V.

14 August 2000

4 October 2010

Salvador de Jesús Tobar Ruiz

350,000 colones

100%

Óscar Samuel Ortiz Ascencio

4 October 2010

 

Dina Alhely Castellón

$10,000

100%

 
Source: National Register (Centro Nacional de Registros- CNR)

A Partner Investigated by Washington

In November 1999, just half a year before the foundation of Desarrollos Montecristo, the US Congress passed the Foreign Narcotics Kingpin Designation Act. Its aim, according to the White House, is to "deny significant foreign narcotics traffickers, their related businesses, and their operatives access to the US financial system … [and authorize] the President to take [action] when he determines that a foreign person plays a significant role in international narcotics trafficking."

Up until 2014, the White House, under Presidents George W. Bush and Barack Obama, had placed 100 groups and individuals on the kingpin list, including Mexico's Sinaloa and Gulf Cartels, and the Familia Michoacana, which were listed in 2009.

 

In none of the documents related to "Chepe Diablo" in the criminal investigations by the United States and El Salvador is there mention of Desarrollos Montecristo

On May 30, 2014, after half a dozen US agencies -- including the FBI, DEA and CIA -- presented the conclusions of a series of investigations carried out in 2013, Obama added three names to the list, including José Adán Salazar Umaña, the founding partner of Desarrollos Montecristo.

Among the documents accessed by OFAC are budget and accounting reports from Salazar Umaña's companies. These documents show, for example, that in 2008 the total assets of Hotesa's hotels were valued at $3.7 million. In the year 2010, when the total sales of the group's six hotels grew 32.6 percent compared to the previous year, the value of Hotesa's assets was $18.5 million.

The year 2008 was also the year in which El Salvador's National Civil Police (Policía Nacional Civil - PNC) and Finance Ministry launched drug trafficking and money laundering investigations into some of the businessmen of Metapán and Santa Ana, who the PNC would later identify as leaders of the Texis Cartel. Among them was Salazar Umaña.

SEE ALSO:  Coverage of Chepe Diablo

In 2013, El Salvador's Attorney General's Office and the Finance Ministry had uncovered enough evidence to prove that Salazar Umaña and two companies linked to him -- Hotesa and Gumarsal -- had committed crimes related to money laundering and illicit enrichment between 2010 and 2011.

Between 2014 and 2015, however, then-Attorney General Luis Martínez ordered officials to stop requesting that a judge grant them access to Finance Ministry documents that contained the criminal evidence against Salazar Umaña. The Criminal Investigation Unit of the General Directorate of Internal Tax (Dirección General de Impuestos Internos - DGII) of the Finance Ministry determined that Salazar Umaña, his businesses and his associates had "falsified accounting registers, inventing operations and … established an increase in assets that was not justified in bank accounts that they owned but had not declared," according to investigation files accessed by Factum and La Prensa Gráfica.

In none of the documents related to Salazar Umaña in the criminal investigations carried out in the United States and El Salvador is there mention of Desarrollos Montecristo.

Nevertheless, by 2012, when Ortiz was carrying out the last transaction recorded by Montecristo, partner Salazar Umaña was already being investigated by security officials who worked under an administration from the vice president's own party, the FMLN.

This article is by Revista Factum and La Prensa Gráfica, and was translated, edited for clarity, and reprinted with permission. Its views do not necessarily reflect those of InSight Crime. See Spanish original here.

Investigations

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