(1)
BOGOTA–Police tear-gassed protesters yesterday as a crackdown on illegal investment schemes exposed class divisions in Colombian society.
Rather than see President Alvaro Uribe as their saviour, many investors were taking the other side.
Thousands of angry Colombians gathered in the capital to protest the shutdown of DMG, Colombia's largest pyramid scheme, on suspicion of laundering drug money. Several hundred were tear-gassed as they blocked a main street in support of DMG founder David Murcia, who was deported from Panama yesterday on money laundering and bribery charges. Six other DMG officials face similar charges.
Uribe suggested that the pyramid schemes not only launder the profits of drug trafficking, they also have links to leftist guerrillas and right-wing paramilitaries.
"We could be facing a blow from the drug traffickers, from the guerrillas, from the paramilitaries who try to launder money by tricking Colombians, and skilfully invoking unjust causes to create hate between Colombians," Uribe said yesterday.
The 28-year-old Murcia has said his company represented an "economic revolution" against the country's banking system, whose high-interest loans have long frustrated Colombia's working class. His lawyer said the company did nothing illegal. Protesters yesterday carried signs praising DMG as a "Company of the People."
"David hasn't failed us. Who failed us was the government that shut him down," said protester Milena Castillo, who mortgaged her home to invest 30 million pesos (about $16,000) in DMG after family members had profited from the company for the last three years.
She held out hope that Murcia, not the government, would find a way to return her investment.
Castillo was among several thousand DMG investors gathered yesterday outside a soccer stadium in Bogota to register for a government plan to repay investors what little it can of their money using cash seized in the company's offices. The government said money would go first to those who had contributed the least, in an effort to protect the small investors who are most likely to be poor.
Murcia's company raked in tens of millions of dollars annually by offering extraordinary interest rates, as high as 300 per cent returns over six months, to some 200,000 investors.
The schemes offer spectacular returns by paying off early investors with the cash of people who invest later. Eventually, the schemes collapse when the flow of incoming money fails to keep up.
