Monday, July 5, 2010

US Export-Import Bank rocked again by fraud

The US Export-Import Bank (Ex-Im Bank) is rocked once again by fraud and scandal in El Paso, Texas. See the recently unsealed federal indictment below.

The mission of the Ex-Im Bank sounds great: to assist in the export of US goods and services to foreign countries. It does so by guarantying loans made by US banks to companies for the purchases of US goods that are exported, in this case to Mexico. If the borrower defaults on loan repayments, the Ex-Im Bank, as guarantor, pays off the remaining loan balance to the private bank. But guess who ends up paying the bill when the loan is fraudulent: US taxpayers.

This case is just one in a series of cases coming out of San Antonio and El Paso involving the Ex-Im Bank. One of the recent indictments involves allegations by the Department of Justice against the grandson of the former Mexican Secretary of Defense. In this county, of course, all are presumed innocent until proven guilty. Here is how the San Antonio Express News reports the case:

Mexican Businessman Indicted in Fraud Plot

US v. Gomez (Indictment)

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