More than 8% of the budget meant for the pensions of Colombia’s security forces is gone because of a controversial real estate deal, according to the Comptroller’s General’s Office (CGO).
In a press statement, the CGO said that the losses for military pension fund Cremil amount to more than COP577 billion ($138 million).
The bulk of these losses are due to the 2015 transfer of real estate property that used to be part of the military headquarters in the capital Bogota.
Cremil transferred the plot on the corner of the 7th Avenue and 100th Street to real estate developers for the construction of the America World Trade Center in 2015.
The developers promised to construct a shopping mall and an office building at the prime location, which would result in revenue for the veterans receiving their pensions from Cremil.
This fell through because the developers failed to take into account that Bogota City Hall was planning the construction of a metro station on the same location and failed to get legitimate private investors involved.
Consequently, the project went bankrupt.
Cremil lost its real estate property because the pension fund never asked the developers for any guarantees, according to the comptroller for the defense sector, Luis Eduardo Parra.
The total, real, quantifiable and current damage exceeds 577 billion, which is caused by the blocking of Cremil’s assets, caused by a bad legal transaction in which the real property rights of the 14 lots were transferred without a real or personal guarantee that would compensate the risk of default by the trust. In short, Cremil transferred the right of ownership in exchange for a mere expectation.
Defense sector comptroller Luis Eduardo Parra
According to Parra, the financial blunder was due to a mix of negligence by Cremil and the involvement of criminal interests in the project.
Cremil executives who were involved in the property transfer could expect criminal charges in the nearby future.
