University of Minnesota Law School Scholarship Repository Minnesota Law Review 2005 Taking Riggs Seriously: The TA CA Case Against a Corporate Abettor of Pinochet Atrocities Shaw W. Scott Follow this and additional works at: https://scholarship.law.umn.edu/mlr Part of the Law Commons Recommended Citation Scott, Shaw W., "Taking Riggs Seriously: The TA CA Case Against a Corporate Abettor of Pinochet Atrocities" (2005). Minnesota Law Review. 691. https://scholarship.law.umn.edu/mlr/691 This Article is brought to you for free and open access by the University of Minnesota Law School. It has been accepted for inclusion in Minnesota Law Review collection by an authorized administrator of the Scholarship Repository. For more information, please contact [email protected]. Note Taking Riggs Seriously: The ATCA Case Against a Corporate Abettor of Pinochet Atrocities Shaw W Scott* In June 2004, a U.S. congressional investigation revealed that Riggs Bank (Riggs) had opened, maintained, and concealed at least six bank accounts for the former Chilean dictator, Au- gusto Pinochet.1 This news came as a surprise to many who be- lieved that Pinochet, although a brutal dictator, was not a cor- rupt one.2 Pinochet, a general in the Chilean army, came to power during a bloody military coup in Chile on September 11, 1973.3 During his seventeen-year dictatorship, the military government committed numerous atrocities ranging from exe- cutions and torture to terrorist acts and disappearances. 4 While Pinochet himself refuses to accept responsibility for these atrocities, the Chilean army recently admitted to its involve- * J.D. Candidate 2006, University of Minnesota Law School; B.A. 1996, University of North Carolina at Chapel Hill. The author would like to thank Professor Susan D. Franck and her editors Catherine A. Biestek and Elizabeth T. Crouse for their helpful comments and encouragement and Martin J. Kifer for his endless support. 1. MINORITY STAFF OF THE PERMANENT SUBCOMM. ON INVESTIGATIONS, 108TH CONG., MONEY LAUNDERING AND FOREIGN CORRUPTION: ENFORCEMENT AND EFFECTIVENESS OF THE PATRIOT ACT (Comm. Print 2004) [hereinafter SENATE REPORT]. 2. See Shirley Christian, Pinochet Is in No Hurry To Relax an Iron Grip, N.Y. TIMES, May 16, 1986, at A6; Pinochet's Tarnished Coin, ECONOMIST, Aug. 7, 2004, at 32; Eugene Robinson, The South American Way of Graft; Everyone's Used to the System, but There Won't Be Economic Recovery Without Some Real Reform, WASH. POST, Dec. 2, 1990, at C1. 3. ROGER BURBACH, THE PINOCHET AFFAIR: STATE TERRORISM AND GLOBAL JUSTICE 1 (2003). 4. 1 REPORT OF THE CHILEAN NAT'L COMM'N ON TRUTH AND RECONCILIATION 35-39 (Philip E. Berryman trans., 1993). Pinochet remained head of the Chilean army until March 1998, at which time he was named senator for life. Curtis A. Bradley & Jack L. Goldsmith, Pinochet and Interna- tional Human Rights Litigation, 97 MICH. L. REV. 2129, 2133 (1999). 1497 1498 MINNESOTA LAW REVIEW [89:1497 ment in an institutionalized campaign of human rights viola- 5 tions during the Pinochet government. Despite international knowledge and condemnation of widespread human rights abuses under Pinochet,6 Riggs has had a relationship with Pinochet and the Chilean military dat- ing at least as far back as the mid-1970s. 7 Records reveal that Riggs consistently turned a blind eye to Pinochet's atrocities by both financing his brutal military dictatorships and concealing and laundering millions of dollars in suspicious funds held in bank accounts for Pinochet.9 Although a Chilean court recently indicted Pinochet on kidnapping and murder charges, he has thus far escaped prose- cution for leading a violent campaign of human rights abuses. 10 5. Larry Rohter, Chile's Army Accepts Blame for Rights Abuses in the Pi- nochet Era, N.Y. TIMES, Nov. 6, 2004, at A5. 6. See, e.g., David Binder, U.S.-Chilean Ties Called Strained, N.Y. TIMES, Nov. 19, 1975, at 5 (noting that the United Nations Social, Cultural, and Humanitarian Committee voted on a resolution calling for human rights protections in Chile); Paul Hoffman, Torture in Chile Is Chargedby a U.N. In- quiry Team, N.Y. TIMES, Oct. 15, 1975, at 8 (stating that a United Nations re- port on Chile found charges of torture, disappearance, and elimination); Jona- than Kandell, Chile's Junta After a Year: Unrelenting Dictatorship, N.Y. TIMES, Sept. 13, 1974, at 1 (stating that more than 2500 people died during the coup and afterwards); Thomas W. Netter, U.N. Panel Urges Chile To Halt Rights Abuses, N.Y. TIMES, Mar. 15, 1986, at 5 (reporting that a United Na- tions resolution urged a halt to torture and restoration of democracy in Chile); Juan de Onis, Chile Study Says Torture Goes On, N.Y. TIMES, June 8, 1976, at 1 (noting that the Inter-American Human Rights Commission, which is part of the Organization of American States, reported charges of arbitrary imprison- ment, torture, persecution, and killings in Chile); U.N. Panel Asserts Chile Continues To Abuse Rights but on a Reduced Scale, N.Y. TIMES, Oct. 25, 1977, at 42 (stating that there was "evidence that violations of human rights were becoming institutionalized in Chile"). 7. PETER KORNBLUH, THE PINOCHET FILE: A DECLASSIFIED DOSSIER ON ATROCITY AND ACCOUNTABILITY 224 (2003) (stating that the secret police and its director under Pinochet maintained accounts at Riggs in 1975). 8. See Kenneth Bredemeier, Riggs Bank Stands Pat on Loans to South Africa, WASH. POST, Aug. 16, 1979, at B3; Christopher Dickey, Human Rights Groups Start Boycott of Riggs Bank Over Loan Policies, WASH. POST, June 16, 1979, at C2; Quarterly Profit Up Sharply at Gannett, Media General, WASH. POST, Apr. 15, 1988, at Cl. 9. SENATE REPORT, supra note 1, at 2-3. 10. See Larry Rohter, Chilean Judge Says Pinochet Is Fit for Trial, N.Y. TIMES, Dec. 14, 2004, at Al. On December 13, 2004, a Chilean judge ruled that Pinochet was competent to stand trial for his alleged involvement in an intel- ligence operation to kidnap and murder political opponents. Id. Known as Op- eration Condor, this plan was a joint action set up by military dictatorships in Chile, Argentina, Bolivia, Brazil, Paraguay, and Uruguay in the mid-1970s. Id. The Chilean Supreme Court upheld Pinochet's indictment and house arrest 2005] TAKING RIGGS SERIOUSLY 1499 However, recent application of U.S. law may open the door to suits against Riggs for its association with Pinochet and his dictatorship. The Alien Tort Claims Act (ATCA),11 which allows foreigners to sue defendants in U.S. courts for alleged torts in violation of international law, has become an important weapon in the effort to hold human rights violators and their accom- plices accountable. 12 Victims of human rights abuse have filed an increasing number of these lawsuits against multinational corporations alleging both direct and indirect involvement in 3 state-sponsored atrocities.' Those who view the ATCA as a powerful tool against hu- man rights abuse argue that when corporate defendants will- fully assist clients who have violated human rights, their com- plicity in the perpetrators' acts should create a legal liability under international law. 14 A multinational corporation's eco- nomic wealth and power often allow it to exceed state bounda- ries and operate outside of state control, thus providing no ef- fective recourse to those injured by its actions. 15 This may be especially true of financial institutions that provide financing to support oppressive governments and terrorist organizations. There is arguably a point at which a bank, such as Riggs, ceases being a "passive repository" for illegally obtained funds of human rights violators and becomes an "active participant" on January 4, 2005. Larry Rohter, Chile: Court Upholds Pinochet Indictment, N.Y. TIMES, Jan. 5, 2005, at A6. 11. 28 U.S.C. § 1350 (2000). 12. See Anita Ramasastry, Secrets and Lies? Swiss Banks and Interna- tional Human Rights, 31 VAND. J. TRANSNAT'L L. 325, 387 (1998); see also Anne-Marie Burley, The Alien Tort Statute and the JudiciaryAct of 1789: A Badge of Honor, 83 AM. J. INT'L L. 461, 461 (1989) (noting that Filartigav. Pena-Irala,630 F.2d 876 (2d. Cir. 1980), which held that the ATCA provides jurisdiction and recognizes a cause of action under U.S. law, "open[ed] up a new field of human rights litigation"). 13. See, e.g., Abdullahi v. Pfizer, Inc., 77 Fed. Appx. 48, 50-51 (2d Cir. 2003); Doe I v. Unocal Corp., 395 F.3d 932 (9th Cir. 2002), reh'g en banc granted, Doe I v. Unocal Corp., 395 F.3d 978 (9th Cir. 2003); Aguinda v. Tex- aco, Inc., 303 F.3d 470, 472-73 (2d Cir. 2002); Bigio v. Coca-Cola Co., 239 F.3d 440, 443 (2d Cir. 2000); Presbyterian Church of Sudan v. Talisman Energy, Inc., 244 F. Supp. 2d 289, 296 (S.D.N.Y. 2003); Eastman Kodak Co. v. Kavlin, 978 F. Supp. 1078, 1079 (S.D. Fla. 1997). 14. See Ramasastry, supra note 12, at 335; see also Michael J. O'Donnell, A Turn for the Worse: Foreign Relations, Corporate Human Rights Abuse, and the Courts, 24 B.C. THIRD WORLD L.J. 223, 264 (2004). ("[W]here corporate de- fendants are guilty of complicity in human rights abuses abroad, their shame- ful and exploitative acts must be exposed, redressed, and stopped."). 15. Jordan J. Paust, Human Rights Responsibilities of Private Corpora- tions, 35 VAND. J. TRANSNAT'L L. 801, 802 (2002). 1500 MINNESOTA LAW REVIEW [89:1497 in their breaches of international law. 16 Proponents of this view would likely agree that this should be the case for financial in- stitutions and corporations that provided significant assistance to perpetrators of gross human rights violations, such as al Qaeda, the Taliban, and Saddam Hussein.