A judge ordered the release of four former executives of Colombia’s once-largest brokerage firm Interbolsa, claiming the prosecution failed to proceed with the corporate fraud trial within the legal time limit.
Among the released is Alessandro Corridori, the main investor of the securities broker that defaulted on a loan and was liquidated in 2012, causing a major crisis in Colombia’s stock exchange where Interbolsa accounted for a quarter of trade.
The Italian Corridori is suspected of being one of the brains behind a massive embezzlement scheme that ultimately spurred the company’s default.
The release had been requested by the defense attorneys of the suspects after another judge last week denied the suspects to be allowed to await their trial from home.
However, according to judge Teresita Barrera, the prosecution had failed to make any progress in the 120 days after the suspects were charged.
The surprise release caused fury with the Prosecutor General’s Office that on Thursday claimed that neither the suspects nor the prosecutors had been alerted about the hearing.
The same judge last year ordered the release of the prime suspect in a major spying scandal that had erupted during the presidential election race. The alleged hacker of ongoing peace talks with rebel group FARC was subsequently sentenced to 10 years in prison.
Interbolsa operated as Colombia’s largest brokerage firm until November 2012, when the government liquidated the company after defaulting on an $11 million dollar loan.
The scandal erupting from the fall of InterBolsa came to light after inquiries into the company’s liquidation revealed potentially criminal actions involving top government officials.
A criminal investigation was subsequently launched into an alleged money laundering scheme, where the company used assets owned by investors to collateralize a borrow and buyback scheme with shares of Fabricato, a Colombian textile company.
Following the firm’s collapse, Colombia’s Inspector General Office dismissed and banned the country’s financial superintendent from public office for 12 years. The financial superintendent was charged with failing to perform his regulatory functions within InterBolsa’s activity.
Inspector General Office said that the Financial Superintendent, Gerardo Alfredo, held preventative responsibilities that “he did not perform.”
The scandal involving InterBolsa had a widespread impact upon Colombia’s financial world in late 2012. The collapse of the brokerage firm, which accounted for approximately 25% of the country’s stock market, caused the Colombian peso to spike and investor confidence to plummet.
Bancolombia, Colombia’s largest bank, took over the failed wing of InterBolsa soon after, restoring investor confidence and causing the peso to appreciate 1%.
The governmental agreement that sanctioned Bancolombia’s investment prevented InterBolsa’s liquidity crisis from infecting the rest of the Colombian stock market.
The former director of Interbolsa fled the country, but was apprehended in Spain earlier this year.